Skip to comments.Euro bail-out in doubt as "hysteria" sweeps Germany
Posted on 08/28/2011 1:56:00 PM PDT by bruinbirdman
German Chancellor Angela Merkel no longer has enough coalition votes in the Bundestag to secure backing for Europe's revamped rescue machinery, threatening a consitutional crisis in Germany and a fresh eruption of the euro debt saga.
Mrs Merkel has cancelled a high-profile trip to Russia on September 7, the crucial day when the package goes to the Bundestag and the country's constitutional court rules on the legality of the EU's bail-out machinery.
If the court rules that the 440bn rescue fund (EFSF) breaches Treaty law or undermines German fiscal sovereignty, it risks setting off an instant brushfire across monetary union.
The seething discontent in Germany over Europe's debt crisis has spread to all the key institutions of the state. "Hysteria is sweeping Germany " said Klaus Regling, the EFSF's director.
German media reported that the latest tally of votes in the Bundestag shows that 23 members from Mrs Merkel's own coalition plan to vote against the package, including twelve of the 44 members of Bavaria's Social Christians (CSU). This may force the Chancellor to rely on opposition votes, risking a government collapse.
Christian Wulff, Germany's president, stunned the country last week by accusing the European Central Bank of going "far beyond its mandate" with mass purchases of Spanish and Italian debt, and warning that the Europe's headlong rush towards fiscal union stikes at the "very core" of democracy. "Decisions have to be made in parliament in a liberal democracy. That is where legitimacy lies," he said.
A day earlier the Bundesbank had fired its own volley, condemning the ECB's bond purchases and warning the EU is drifting towards debt union without "democratic legitimacy" or treaty backing.
Joahannes Singhammer, leader of the CSU's Bundestag group, accused the ECB of acting "dangerously" by jumping the gun before
(Excerpt) Read more at telegraph.co.uk ...
House of Cards
Why don’t the German taxpayers just shut up and carry the load of the deadbeats, just like we do in America?
The elites do not like representative democracy much, which is why the EUSSR isn’t one.
Sounds like Germany is full of those evil, racist Tea Party members.
The Krauts are saying to themselves, “Why should we bail out those deadbeats?” Yeah, why should they? And why should WE?
They tried that after WW I, the Treaty of Versailles, and it didn't go over too well.
Maybe Pooty-poot can bail them out to get East Germany back. That’d be funny.
Didn’t the Germans elect some kind of National Socialist, like 0bama, to sort their problems out?
I can't say that I blame them.
Maybe we should have a debt union with Germany ourselves?
Apologies- I didn’t see your earliest post.
That point in Socialism that Margaret Thatcher pointed out, where you run out of other people’s money, seems to have been reached in Europe.
Jug ears has it bass ackwards as usual.
“That point in Socialism that Margaret Thatcher pointed out, where you run out of other peoples money, seems to have been reached in Europe.”
And we are within a short distance of having reached it here. The time will come when normal standards of bond pricing will be applied to Treasuries. At that point rates for 10-year Treasuries, for example, will probably hit 7% to 8% at least.
It will be interesting to see how the political class and other taxeaters respond to a situation in which debt service starts moving toward $1 trillion/year and states and municipalities are forced out of the bond market because the rates are prohibitive..
By raising the debt ceiling, Boehner and the weak, Bush-like Rs may have fumbled away the last chance to force the government to become fiscally responsible, thereby giving us a chance to avoid a monstrous financial and social calamity. We shall see...
That myth ranks right up there with "FDR got us out of the Depression." Hitler put everyone to work (much like FDR), but he consumed every pfennig of capital in the country to do it.
His policies ate the guts out of the Germans' wealth to keep his war machine going. That was not economic growth, it was pure Keynesianism (who rather admired Hitler) on steroids.
So they’ll try to get US taxpayers to bail out the ECB. And has any Pubbie presidential candidate taken a stand on any future bailout of the ECB? Inquiring minds want to know....
Gold Man Sacks seems to p0wn the gov’t.