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16 October 2012

Telegraph: Germany shocks EU with fiscal overlord demand


Germany has stated its exorbitant price for keeping Greece in the euro and agreeing to mass bond purchases by the European Central Bank.

There must be an EU “currency commissioner” with sweeping powers to strike down national budgets; a “large step towards fiscal union”; and yet another EU treaty, finance minister Wolfgang Schäuble said.

Officials in Brussels reacted with horror. “If that is the demand, they are not going to get it. Nobody in the Council wants a new treaty right now”, said one EU diplomat.  “We’ve got the fiscal compact and quite enough fiscal discipline. Not even the Dutch want a commissioner telling them how to tax and spend”, he said.

Mr Schäuble said the currency chief should have powers similar to those of the EU’s competition commissioner. The Schäuble plan is highly provocative. The EU can set deficit targets but it cannot manage budgets, unless a country requests a bailout and gives up fiscal sovereignty. Nor is it clear how Germany’s constitutional court would react. It ruled last year that the Bundestag’s budgetary powers are the bedrock of democracy and cannot be alienated to any supranational body.

Full article



© The Telegraph


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