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International News Title: Court Rejects Challenges to German Euro Bailouts [German Courts: We All Sink TOGETHER!] KARLSRUHE, Germany — In a widely followed ruling on Wednesday, Germany’s Constitutional Court upheld the legality of Berlin’s rescue packages for debt-stricken euro zone countries, but said any future bailouts must be approved by a parliamentary panel. Multimedia Interactive Feature Tracking Europe's Debt Crisis.Related News Analysis: In Euro Zone, Banking Fear Feeds on Itself (September 7, 2011) News Analysis: Merkel’s Blunt Talk Offends Debtor Nations (September 7, 2011) Readers’ Comments Share your thoughts. Post a Comment » Read All Comments (13) » The decision was viewed by some analysts as a rare triumph for Chancellor Angela Merkel and seemed to place fewer restrictions than some had expected on her ability to react to the European debt crisis. At the same time, the high public standing of the court should lend broader legitimacy to government efforts to shore up the European currency. But, other analysts said, the ruling could hamper Mrs. Merkel’s power to take quick measures. The court’s president, Andreas Vosskuhle, said the ruling did not represent a “blank check for additional rescue packages.” Speaking at a parliamentary budget debate in Berlin, Mrs. Merkel said the ruling had “absolutely confirmed” her government’s “transparent” handling of Europe’s debt crisis in close consultation with Parliament. “That is exactly the path we have followed,” she said. Mrs. Merkel again underlined her country’s commitment to the single currency and European integration, saying the euro was “much more than a common currency.” “If the euro collapses, so does Europe,” she said, adding that “Germany’s future is inseparable from Europe’s future.” Closely watched by nervous markets, the court ruled that the government must seek the approval of Parliament’s budget committee before making money available for future bailouts of European countries struggling under mounting debt burdens. “This was an important victory for Merkel’s government,” Christel Aranda-Hassel, an economist at Credit Suisse, said in a research report. “At the same time,” she added, “the court strengthened the hand of Parliament.” The need to seek approval of the Bundestag’s budget committee for future aid “will only make the process to rescue the euro more cumbersome at a time when speed is of the essence.” Indeed, said Jan Dubsky, a euro area economist at the Royal Bank of Scotland in London, “it’s not going to be such a lengthy process as feared, but there is still an approval process necessary.” The euro rose slightly on currency markets as word of the ruling emerged, but German Bund futures extended their losses, Reuters reported, quoting one unidentified trader as saying that while the broad outlines of the decision had been widely expected, markets were still waiting to parse the details. The DAX Index in Germany posted gains, along with other European stock markets. Jessica Koch, an analyst at the Center for European Policy in Freiburg, Germany, said the decision could have implications for future efforts by euro zone governments to cooperate more closely in fiscal policy, for example by jointly issuing debt in the form of “euro bonds.” The ruling, consistent with previous court decisions, means that “certain decisions on revenue and expenditure must remain in the hands of Parliament,” Ms. Koch said. “That is fundamental for the democratic state. You can transfer competencies to a certain extent. You can’t transfer them completely.” In Parliament on Wednesday, Mrs. Merkel renewed her opposition to the idea of issuing eurobonds as a means of solving the debt crisis. “Eurobonds are the way to a union of debtors,” she said, calling the idea “the wrong answer. That is why we will not go down this route.” The court rejected three appeals against the legality of earlier bailouts, which have stirred a furious political debate among Germans. The suits had been brought by a coalition of German lawmakers, economists and business executives who argued that Germany’s participation in loans and support funds for Greece undermined Parliament and infringed constitutional provisions underpinning the country’s democracy. German parliamentarians welcomed the ruling. “I am particularly pleased,” Wolfgang Bosbach, a leading member of Mrs. Merkel’s governing Christian Democrats said, adding that he hoped the outcome would end the divisions inside the center-right coalition over the rescue package and speculation on whether Greece should be expelled from the euro zone. The main opposition party, the Social Democrats, which had consistently supported the rescue package for Greece, also welcomed the ruling. But Frank-Walter Steinmeier, the Social Democrat leader, accused the government of having no long-term policy toward Europe. “For over a year, this government has delayed, changed policy and divided over what to do. That is the reality.” Multimedia Interactive Feature Tracking Europe's Debt Crisis.Related News Analysis: In Euro Zone, Banking Fear Feeds on Itself (September 7, 2011) News Analysis: Merkel’s Blunt Talk Offends Debtor Nations (September 7, 2011) Readers’ Comments Share your thoughts. Post a Comment » Read All Comments (13) » Sabine Leutheusser-Schnarrenberger, the justice minister, said the ruling had strengthened Parliament’s sovereignty over the state finances. “It is right to bind the democratically elected representatives of the people more closely to the decisions on saving the euro,” she said. The president of a German business group welcomed the decision, which he said would provide parliamentary oversight, while allowing closer integration of euro zone members. “The budgetary right of the Bundestag will be guaranteed in an appropriate way,” said Hannes Hesse, president of the German Engineering Federation, which represents manufacturers. In a statement, Mr. Hesse added, “In the long term it will only be possible to stabilize European currency union when the national parliaments of all the euro countries accept limits on their fiscal sovereignty.” “The euro project will make a more unified economic policy in the euro zone unavoidable,” Mr. Hesse said. The Constitutional Court, despite its distance from the capital, is consistently found to be the most respected player in German government and more than willing to stake a claim. The court declared in a 2009 ruling on the Lisbon Treaty that it had jurisdiction to overturn European policies, rules and decisions it finds unconstitutional. “The court has defined itself as the guardian of the Constitution, playing a much different role from that of the American Supreme Court,” said Donald P. Kommers, emeritus professor of political science and law at Notre Dame and author of a book on the German court. “In Europe, there is no Constitutional Court stronger or more visible in the public sphere and political landscape than the German constitutional court,” said Matthias Herdegen, director of the Institute for Public Law at the University of Bonn. “Even those opposed to certain steps feel it is an organ that responds to their concerns and that’s an enormous contribution to the legitimacy of the German political process.” The German court puts tremendous emphasis on consensus and split decisions are very unusual, said Uwe Kranenpohl, professor of political science at the Lutheran University of Applied Sciences Nuremberg, who interviewed 30 current and former judges from the court as part of his research. Germans have “great trust in judges, Mr. Kranenpohl said, possibly due to the fact that “rule of law is older than democracy here.” Events elsewhere in recent days have demonstrated all too clearly the fissures among a heterogeneous collection of states that must forge a common policy to shore up the euro. Often viewed as a simple matter of coordination between Paris and Berlin, the demands of tiny Finland for collateral from Greece and the refusal of Slovakia’s speaker of parliament to put the European bailout fund to a vote have called into question the ability of these disparate groups to work together. At the same time the ability, and indeed the willingness, of states like Greece and even Italy to rein in spending and get their deficits under control has been viewed with increased skepticism. That in turn reduces the appetite of rich states to guarantee more of their debts, even if the refusal jeopardizes the euro. Supporters of greater integration contend that a common economic government is the missing element for a stable future for the currency bloc.
Poster Comment: Had the court nixed the bailouts, Germany might have been able to weather the Force-5 financial hurricane heading towards Europe. Instead, they lash themselves to the sinking ship, in a foolish demonstration- not of courage, but stupidity. Unreal
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#1. To: Capitalist Eric (#0)
Sounds like they have as many problems with their schools as we do with ours...
When asked by a Liberal what I bought my Granddaughter for her 1st birthday I replied, "MORE AMMUNITION"!!!! -----------------------------"People sleep peaceably in their beds at night only because rough men stand ready to do violence on their behalf."
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