German Court Set to Trip Up EU? ...
German court to insist on bail-out reforms ... The German Constitutional Court is set to demand that the German government does more to ensure "democratic legitimacy" for its support for European wide bail-outs in its long-awaited judgment on the legality of the multi-million bail-out of debtor nations. Chancellor Angela Merkel has faced criticism for not seeking fresh democratic mandates for the millions of euros the German government has provided in support for the eurozone's struggling nations such as Greece and Ireland ... Leading European experts have said that, although the court is unlikely to throw out the bail-out policy, which would cause chaos across the eurozone, it is likely to set conditions on continuing German support for the policy. Matt Persson, of the think tank Open Europe, said: "The Court will almost certainly approve the bail-outs, possibly citing as a reason that monetary stability is a legally protected interest.. However, the Court is also susceptible to public opinion and, in order to guard its reputation, could well demand more influence for the German parliament and lay down additional constitutional red lines in return for approving the bail-outs." It could also make moves towards fiscal union in the eurozone even more complicated, he said. – UK Telegraph
Dominant Social Theme: The German court's ruling is merely a glitch on the way to an EU superstate.
Free-Market Analysis: German judges are to decide on Wednesday whether Chancellor Angela Merkel was within her rights to OK EU bailouts. While the euro-media has downplayed the consequences, they could nonetheless be grave. There is nothing like a consensus in Germany over the deals Merkel has made with the rest of the EU.
Five German professors launched the lawsuit and recently Professor Dr. Wilhelm Hankel, one of these professors, claimed that Germany could be using the Deutschmark again by 2012. "I think the chances of a favourable ruling are good," he said. "Contrary to the last complaint made against the euro in the 1990s, the court has accepted the complaint from the first minute, it has not been rejected," he told the Telegraph.
Recent reports have indicated that at the very least the Constitutional Court will attempt to limit what Merkel can do going forward. And with the crisis far from resolved in Europe, such limitations may further complicate EU policy choices. Top EU leaders have been pressing for a closer political union, and the Court's ruling could make this more difficult. The fallout could be severe, politically, economically and from a market perspective.
German court to insist on bail-out reforms ... The German Constitutional Court is set to demand that the German government does more to ensure "democratic legitimacy" for its support for European wide bail-outs in its long-awaited judgment on the legality of the multi-million bail-out of debtor nations. Chancellor Angela Merkel has faced criticism for not seeking fresh democratic mandates for the millions of euros the German government has provided in support for the eurozone's struggling nations such as Greece and Ireland ... Leading European experts have said that, although the court is unlikely to throw out the bail-out policy, which would cause chaos across the eurozone, it is likely to set conditions on continuing German support for the policy. Matt Persson, of the think tank Open Europe, said: "The Court will almost certainly approve the bail-outs, possibly citing as a reason that monetary stability is a legally protected interest.. However, the Court is also susceptible to public opinion and, in order to guard its reputation, could well demand more influence for the German parliament and lay down additional constitutional red lines in return for approving the bail-outs." It could also make moves towards fiscal union in the eurozone even more complicated, he said. – UK Telegraph
Dominant Social Theme: The German court's ruling is merely a glitch on the way to an EU superstate.
Free-Market Analysis: German judges are to decide on Wednesday whether Chancellor Angela Merkel was within her rights to OK EU bailouts. While the euro-media has downplayed the consequences, they could nonetheless be grave. There is nothing like a consensus in Germany over the deals Merkel has made with the rest of the EU.
Five German professors launched the lawsuit and recently Professor Dr. Wilhelm Hankel, one of these professors, claimed that Germany could be using the Deutschmark again by 2012. "I think the chances of a favourable ruling are good," he said. "Contrary to the last complaint made against the euro in the 1990s, the court has accepted the complaint from the first minute, it has not been rejected," he told the Telegraph.
Recent reports have indicated that at the very least the Constitutional Court will attempt to limit what Merkel can do going forward. And with the crisis far from resolved in Europe, such limitations may further complicate EU policy choices. Top EU leaders have been pressing for a closer political union, and the Court's ruling could make this more difficult. The fallout could be severe, politically, economically and from a market perspective.