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German Bailout Rebellion: “We Have Euro-Anarchy”
Wolf Richter www.testosteronepit.com
For German Chancellor Angela Merkel and her ilk, it’s going to be a steamy August and an even steamier September and October with political battles left and right, to be fought mano a mano, as the Eurozone debt crisis and the growing bailout rebellion in Germany are migrating from parliamentary discussions, closed-door meetings, and shaky EU summit deals—21 of them so far—to electoral politics. Voters may finally have a say.
She has consistently driven her agenda towards a more integrated Europe, but her solutions to the debt crisis have butted into the German constitution. The Fiscal Union treaty and the ESM bailout fund are currently being dissected by the Federal Constitutional Court, with a decision due on September 12. These mechanisms would transfer budgetary sovereignty and other rights from the Bundestag to the EU government, and thus from voters in Germany—or Italy and Spain, for that matter—to unelected bureaucrats in Brussels.
More mechanisms with sovereignty transfers have appeared on the horizon as the EU government has embarked on a power grab—supported by many national politicians with visions of upward extensions of their careers. Might German Finance Minister Wolfgang Schäuble be dreaming about a promotion to EU Finance Minister? And the inevitable Merkel to EU President?
Thus, a few weeks ago, Schäuble had voiced the word referendum, sending shockwaves through the system. With that word, he’d called for a new constitution that would permit the transfer of sovereignty. A constitutional convention would draft it, and the people would vote on it. Politicians on all sides jumped in behind him. On the right, coalition partner CSU was enthusiastic, particularly Bavarian Minister-President Horst Seehofer. Saturday it was Foreign Minister Guido Westerwelle (FDP) who came out in favor. The next day, it was Sigmar Gabriel, President of the center-left Social Democrats (SPD) who wanted “to ask the people.” But the agendas couldn’t be more different.
Seehofer wants to drive a wooden stake through the heart of the mechanisms that transfer Eurozone debt to Germany, such as Eurobonds or a banking union. And he sees the referendum as a chance for voters to say heck no! His party faces strong opposition in Bavaria from the Freie Wähler (Free Voters) who have demonstrated in the streets against a future where a “child, just after being born, is already liable for the bailouts that great-aunt Merkel had signed” [Bailout Rebellion Reawakens in Germany].
Westerwelle might be more interested in creating a European constitution, an effort that had already disastrously failed when the Constitutional Treaty, signed by the 24 member states in 2004, was rejected by French and Dutch voters in 2005. They’d been given a vote. Germans had not.
Gabriel lashed out against Merkel. The liabilities from the bailouts were already enormous, he said, but “without control.” Merkel is “tolerating with a wink” that the ECB buys sovereign debt of Spain and Italy, “while her party colleagues criticize it.” Through the bailouts, Merkel had already created a “secret debt union,” but didn’t want to tell the people. He accused her of always acting too late and without a “clear crisis solution strategy.” It could not be that there is a common currency, he said, “but other than that, everybody is doing whatever they want.” While some countries might not increase their taxes and run up deficits, Germany would have to pay in the end. “Today we have euro-Anarchy,” he said.
His solution to the euro-Anarchy: Eurozone-wide mutualization of debt linked to a centralized control of national budgets by the European government, in which he would no doubt play a large role. The Greens are already in his camp.
Just when there is less agreement within the Eurozone than ever before, and more tensions and discord, all seventeen member states should suddenly fuse together into a solidarity that has never before existed, and integrate into a happy union, subservient to a mega-federalist construct run mostly by unelected bureaucrats, at the expense of taxpayers in Germany, France, and elsewhere.
Even in the US, after two hundred years and a civil war, states are still responsible for their own debts, though we’ve come close to Gabriel’s model via the indirect federal bailout programs for states and the Fed’s printing press that threw so much money into the air that some of it even reached California—which was issuing IOUs at the time.
The French and Dutch, when given a chance to vote on the European constitution in 2005, “unexpectedly” voted for sovereignty. Referendums are risky. And in Germany, voters might follow the French and Dutch example. Meanwhile, the referendum, though it might never come about, is already doing something else: it’s eating into the substantial support among the opposition for Merkel’s policies, and difficult battles and compromises lie ahead.
Germany and Austria may have their differences, and their love for each other may not always be palpable, but when it comes to money, they’re joined at the hip. And now the euro debate took on sharp tones in Austria as well. With a new theme: “Insolvency Procrastination.” Read.... The Euro Revolt Spreads To Austria: “Europe Can Only Function If Every Country Has Its Own Currency.”
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What is that drivel?
Europeans were nearly eliminated from Europe.
This was done by Asians. The Asians known as Indo Europeans.
Who parade themselves as Europeans when they are not.
And who write a lot of fantasy to hide that fact.
What homo asiaticus, homo africanus, homo hispanics, homo arabicus have to do with large scale slaughters as it was performed by Indo Europeans (led by people like the Germans) on Europeans?
It is already done.
Australasia?
Ah, 'Americans' and their taste for fantasy. How cool...
you're both drivelling. slipping over each other's saliva. IMHO
Your opinion is your opinion.
Facts are facts.
Indo Europeans are not European people. They came from Asia and mass slaughtered european people.
As shown by DNA studies...
Well it looks like Rossi's e-Cat is the real deal so Europe may not need Saudi oil or Saudi backed invaders of Europe. Beretta can provide what they provided 441 years ago to solve that European islamic problem.
Rossi is an elaborate scam. Any money you give him will be lost.
Kitty Litter has more value than his e-Cat.
can you back that statement up?
I'm not looking for a fight, I just want information.
Personally I`d like to believe it works but here:
http://www.msnbc.msn.com/id/46342612/ns/technology_and_science-science/t/fraud-claims-over-e-cat-cold-fusion-machine-heating/#.UCuq_t2PVk0
They are making a big mistake...just like anyone who co-signs for someone else's debt obligations. More often than not, you are the one who will end up paying the debt. I think most of the whole has gone nuts.
Nigel Farage for President of the EU.
US citizen Farage is a mouth piece of the city of London bankers.
Indeed, the thing is; half of what he says is true. The other half we don't get to hear. (otherwise he'd be dead a looooooong time ago)
Here's the other half LOL: https://www.youtube.com/watch?v=4SusYrcFagU
And this chap says Nigel Farage is not as good in killing the dead as Abraham Lincoln, the Vampire Hunter.
http://www.thedailybell.com/4174/Anthony-Wile-Parting-Company-With-Nigel-Farage-and-Suggesting-a-New-Role
Bravo, bravo. Nigel Farage for President of the United States. We could fake his birth certificate. My wife and I are old enough to be his parents and I would swear he is ours. EU, what for? We need him here. I would like to see the debates. Obama, Mittens and Nigel ... no contest.
But could the American public recognize the truth, and accept it if they do?
Yeah, and first act of Sir Nigel, disolve the EU!
and hang Barroso, Van Who? and Lady Ashton!
I am so sick of all the stupidity regarding the EU crisis. If you're American, I have a very simple way of making you understand.
Imagine the US merged with Canada. Of course, Canadians would puke all over everything, but that's not the point. It would be absolutely seamless. The political center would shift a few degrees to the left and that would be it. Commerce, government, society, everything would slide together without a hitch. And everything would simply go on as it does now. It would be like adding another (colder) California ... no big deal.
Now imagine trying to do the same thing with Mexico. What an unholy fucking disaster! It would never work, there would be people moving all over the place, with insurmountable education, language, cultural and economic barriers. It would last about 10 years and then implode. (Sound familiar?)
BTW: I am NOT criticizing Mexicans, they have a wonderful culture of their own. We are just incompatible in that way, that's all. By keeping our money separate, and our regulations tuned to the local culture, we are much better partners than if we tried to unify. It's the exact same thing as Greece, Italy and Spain tryng to unify with Germany.
And in these two scenarios lies everything you need to know about the EU: IT WILL NEVER FUCKING WORK! I don't care how many fiscal hand cuffs you put on them, they are not compatible, period. And I say "vive la difference", lets celebrate who we are, an not try to legislate new "comaptible" identities.
The weird thing is that Canada and the US don't need to do anything, we are perfectly happy the way we are. We are a little different, but we are each other's best partner without even talking about it. And that's probably true for nothern Europe too, you don't really need an EU, and certainly not a EMU.
I don't see why Europe can't reap the economic benefits they're after without a complete transfer of sovereignty and becoming "one nation".
They should easily be able to share a common currency and eliminate trade barriers and coordinate their laws enough that they're all playing on a level playing field. That should be all that is required to get the vast majority of the benefit.
For hundreds if not thousands of years countries around the world shared a common currency, gold &/or silver, without all countries having to take on the burdens of other countries getting themselves into too much debt. They should all be left to stand on their own two feet. Reality has a way of forcing everyone to live within their means one way or another.
Tut: Great analogy. Makes the case clearly. However, you wrote:
"BTW: I am NOT criticizing Mexicans, they have a wonderful culture of their own. We are just incompatible in that way, that's all. By keeping our money separate, and our regulations tuned to the local culture, we are much better partners than if we tried to unify. It's the exact same thing as Greece, Italy and Spain tryng to unify with Germany."
If the culture of Mexico, such as it is, is so "wonderful," why are "we just incompatible in that way"? What about the culture is wonderful? How is it, if the culture is wonderful, does it fail in a "United States of North America" scenario?
Clearly, you are saying that Greece, Italy, Spain, and Portugal, all nations of "the South," are incompatible with the united nations of Europe's "North." Why do those cultures fail to work within the larger European construct?
I think Mexico's "culture" is one we would not in any way wish upon this nation. It is not wonderful. It's history is one of turmoil, poverty, Statism, civil war. A culture that has produced that history is a culture I would not describe as "wonderful."
Unfortunately, the notions of multiculturalism, diversity, and "equality" have led our political "leaders" to invite this defective culture into our nation, likely resulting, in some 20-30 years, in a Balkanization of at least the Southwest, if not entire swaths of many other states.
In defense of Mexico:
Although it has been ruled by a "perfect dictatorship" for most of the last century, perpetuating a rigid neo-feudal class system, things have improved immensely recently, in spite of the much publicized drug wars and its "collateral damage". There is little in the way of government entitlement spending... little medicare, a trifling social security system, no foreign wars and domestic profiteers to support, By constitution, there is a rigid separation of church and state, with the clergy being disenfranchised from voting... all this in an intensely Catholic country.
By consitution the Mexican military cannot be deployed in foreign lands, releiving the country of the cost of an agressive foreign policy. Land ownership reform is progressing slowly... but the average mexican home is unencumbered by debt and built on a cash and carry basis. The country is only now beginning to lever home equity... the opposite of the delevering in Canada/US.
My guess is that within a decade, the Mexican standard of living and the Can/US will meet somewhere in the middle as the rich countries implode and the Latinos grow.
Reminds me of the radical feminists from the 70's and 80's that insisted on forcing male children to play with dolls and the girls to play with Legos whether they liked it or not. You were going to become androgynous come hell or high water! That what the whole EU thing reminds me of. Greece and Deutchland no problem just one big happy family.
I wouldn't call another California no big deal, I think you greatly underestimate how much it is hated between its borders and New England. Another would be throwing a spark on a very dry powder keg.
Most hated state by a wide margin-
http://blogs.laweekly.com/informer/2012/02/california_hate_americans_poll.php
Oh Say, can you see Canada...
Maple Leaves and Stripes 4ever. Harper for VP.
Alberta will be happy as the new Keystone will flow from there...TransCanada will build it...
and Canucks won't have to be rude any more...
http://ca.finance.yahoo.com/video/canews-22424922/rude-canadian-shoppers-at-costco-30269630.html#crsl=%252Fvideo%252Fcanews-22424922%252Frude-canadian-shoppers-at-costco-30269630.html
And may be Rosie can comment on NAD (North American Dollar).
I have a dream...
Great write up, Wolf.
Could boring someone to death be a form of "soft kill"?
I'm so ready for a leader over there to really stir up the pot, no more "blah blah blah".
Let's get this over with and move on.
IMHO, it's not a question of leadership. The bottom line is that Northern Europe, Germany in particular, must permanenetly transfer wealth to Southeren Europe for the political experiment that is the Eurozone (And the EU for that matter) to survive. Whilst political leaders want to proceed, the problem is this damned democracy thing. The peoples of Europe have voted time and again that they do NOT want to surrender their sovereignty to (Particularly drab and unappealing) unelected bureaucrats in Brussels and continue to do so in opinion polls. So "Leadership" would be EITHER to force it through and not get re-elected OR pull back and see the Eurozone fail. That is not the stuff of politicians.
Instead, the peoples of Europe must decide and are more than capable of doing so IF they are given the opportunity so to do. There's that damned democracy thing again!!
http://www.youtube.com/watch?v=AE4VqHTURUY&feature=g-all-lik
A Dow collapse watch is in effect!
Voters ?
Do they matter?
Voters can make a difference actually.
Once TPTB create a proper crisis, ... then the voters will vote "correctly".
Once TPTB create a proper crisis, ... then the e Tvoters will vote "correctly".
In the brainwashed US, perhaps, but not in Europe.
Are you really that confident, or just trying to stir the pot a little?
Even if your comrades will vote the way you think they will in the numbers you expect, there's no guarantee the official results will turn out the way you expect.
Stalin: "The people who cast the votes decide nothing. The people who count the votes decide everything."
A couple of links from posts yesterday about the potential for voting fraud with the computerized vote counting.
Spanish Company Will “Count” American Votes Overseas In November
Recipe for Vote Fraud: Global Internet Voting Firm Buys U.S. Election Results Reporting Firm
Black Box Voting
The Europeans will vote for a "Savior" too.
And the oligarchs will present a savior perfectly matched to their crisis.
The upcoming elections in the Netherlands are key. Democracy there being what it is, compromising on the future Eurozone will be the only way to a coalition government.
The compromise is obvious: the core Eurozone countries should not lose what they have gained so far from the intergation process.
But it is clearly the time for a breather on further loss of souvereignty and a time to consolidate what has true European, common, value in the current stage of integration.
Forcing total integration down everyone's throat is not politically feasible and any attempts may result in voters' revolt and total dis-integration, something that nobody wants.
The way forward is to intergrate Germany, France (yes, France), the BeNeLux, Austria and Finland into a New Intergrated Eurozone with Institutions for fiscal coordination that get 10 years to evolve and prove themselves.
Other EU members can be invited to join when they fulfill the required criteria.
Go, Dutch voters!
Make your politicians say it.
Any merging or giving up of sovereignty should be done freely and not while under duress. Shotgun weddings are not a good way to forge a happy and permanent marriage of love and mutual respect.
The current bureaucratic central planners are all focused on the goal of making the banksters whole, and in control of the money. That does NOT serve the best interests of the people.
The individual countries and banks should be allowed to default on debts that cannot be repaid. They can all keep their sovereignty and live under a real money monetary system based on gold, or even perhaps a euro constitutionally tied to gold to keep the central banksters from just printing money at will. That's what got the world into this mess in the first place.
Then let the lenders take full responsibility for their loans. If the central banksters aren't creating massive bubbles via their artificially created booms and busts, and the lenders know they won't be bailed out by the taxpayers, or the citizens via inflation, they won't be apt to loan money to those who can't pay it back, and certainly won't let them get *this* far in over their heads in the future.
If they just recognized reality, gave haircuts where necessary, and in amounts that reflect reality, the reset would set a new solid foundation upon which the world economy can start to heal and rebuild.
There would be no need to transfer sovereignty, with a gun to their heads no less, to share a common currency, and to have no/low barriers to free trade.
Transferring power to unelected bureaucrats who are themselves puppets on a string to behind the scenes power brokers is a nightmare waiting to unfold.
99% agree with you with 1 caveat
...there is no sovereignty, no nation state, to give up
the borders are defined by politicans, not the people who want to move freely
the ONLY service a broder does is provide a post for politcians to piss on, to Tax, Tag & Control those within ...the flag, anthem and all else is cheap fabricated jingoism
we want freedom, not corraling and herding... the nation State is pure folly, it must go too
we want freedom, not corraling and herding... the nation State is pure folly, it must go too
Funny, the Nation State was originally conceived as the way to give the people freedom. (mostly when they were oppressed by another nation). So if the Nation State is no longer satisfactory, what should take its place? The Region(s)? City states?
Or do you think the current conglomerations of Nation States (coalition-of-the-willing, anyone?) are satisfactory?
Tompooz "The way forward is to intergrate Germany, France (yes, France), the BeNeLux, Austria and Finland into a New Intergrated Eurozone with Institutions for fiscal coordination that get 10 years to evolve and prove themselves. Other EU members can be invited to join when they fulfill the required criteria."
Er, excuse me isn't that precisely the exact same process of how this epic political disaster in Europe was formed over the past 40 years????
You believe a bloated institution, the more bloated the better (why go national when you can go international eh?), can deliver anything of value to the people... you believe this institution of windbags can take/thieve peoples money and spend it better than them.
The EU is totally deranged, it is doing nothing for the people, it is all about itself with its head rammed so far up its own rectum they wouldn't know what the people want if they said "No" to the EU. Iit is merely concerned with its own power and income and expanding its Empire, like all bureaucracies
Here's the news: you cannot be represented better than you represent yourself. Give up on Governance, it just makes every issue worse and give up on someone looking after/nannying you..... Govt is a total sham, representation is a total fraud, smell the failure
Grow up, do it yourself, like a responsible mature adult
Er, excuse me isn't that precisely the exact same process of how this epic political disaster in Europe was formed over the past 40 years????
Actually, the same core (Eur.Coal and Steel Union) countries, benefited quite a bit from their original uniform regulations of that industry. At the time is was a success, not a disaster. It was that success that emboldened the politicians to take Europe into the integration 'fast lane" and into a common currency.
The Euro (zone) is that second, different story. Everybody now knows that it cannot hold together without fiscal integration and loss of national sovereignity.
The voters in the core countries do not want a currency union that joins them to the club mediterranee. Not now and probably not in the next 10 years.
But they could be persuaded to test the idea of a smaller Eurozone with like- minded fiscal regimes appointing Eurocrats that are honest and competent enough to be entrusted with the fiscal coordination. National budgets in the Northern area will not see all that much modification, so the loss of souvereignity (joint sovereignity, really) will be gradual and reversible if the voters don't like it.
All I'm saying is, that it is preferable over total dis-integration.
Er, excuse me isn't that precisely the exact same process of how this epic political disaster in Europe was formed over the past 40 years????
The real political problem is that the national politicians uses the EU to launder unpopular legislation.
Blobbing up can not be surrendered.
By the way, the MO as it goes is the same as it went.
The EU experiment started as a core of countries that could be joined up when this or that...
See the results.
And people in power, no matter their strip, have to deal in reality.
“Germany in particular, must permanently transfer wealth to Southern Europe”
I think that concept is skewed from the onset as there is no wealth to transfer, there or here.. only credit in the form of indenturing us all and the children. Credit, which at the front end is converted into wealth for the 1% and at the back end to debt for the 99%.
These people have no right (US included) to enslave present and future generations to the political and financial class thieves and collectivists.
This is matter of evil that must be vanquished.
We are indeed in an historic "moment of truth" turning point for western democracies. Historians say that there were multiple places Hitler could have been stopped relatively easily in his rise to power, but people were too complacent, lazy or frightened to do so until it was too late.
I think we're in a similar situation now, but too many people don't realize it and the path of easiest resistance is to sit on our hands and watch, hoping the politicians will somehow do the right things and pull us out of this in honorable fashion.
People better wake up and soon or people will wake up being ruled by evil leaders with power heretofore unthinkable.
It's not a pretty situation, but our forebears had the courage and the moral conviction to stand up and do the hard things necessary to pass on a government based upon freedom and moral principals we could all live under in justice. It is now time for us to be willing to pay the price to do the same for our children and future generations.
Spot on Jeff. A young college student asked an old jewish man why he did not flee Germany when Hitler was rising to power. The old man replied he thought things would get better until the GESTAPO was knocking on his door.
Even stating that what the hell are you going to do. All I can do is not play the debt game and invest in tangible items. As long as you play the debt game, you are doing nothing but further enslaving yourself to the government and financial institutions. I think a leader will actually appear out of the middle class as it is not going to be the poor or rich. They are both sucking at the government teat. Nothing is going to change until we can no longer spend in my mind. Of course after this years elections things may well get ugly. I think the markets and numbers in government statistics are a being propped up and they are both a joke. It does not matter what party sits in the White House though.
As I look around today our rights are being taken away every day and nothing will happen until it is indeed too late in the game. Obama is going to win again and they will be coming for our right to bear arms. I may be crazy but that is ok.
GCT, you are not crazy. They will NOT be able to confiscate the guns though. They CAN ban further sales, tax guns & ammo highly or otherwise make it problematical to buy in the future.
A good way to prepare for any such bans would be to stock up now!
I agree with you Manthong. But maybe your point indicates the good news. More credit WILL be piled onto the flaming heap and it WILL crash at some point. Because in a zero growth environment, it can never be repaid. What has to end, eventually will.
manthong, one bizzilion thumbs ups for you...
But surely, Germany are not alone in the bailout. France, Italy and Spain have promised huge amount of bailout cash, in fact 50% of the "big bazooka". I don't see what the problem is. /sarc
If you want to be n every corner of Europe, transferring money across countries in large scale is a great concept!
Get you "EURO? Nein Danke" sticker now!
Come on now, didn't we all wanted these [easy] credit things?
And this is now a matter of evil?
Oops, the evil is within us, vanquish time?
I'll put my head back in the sand-now-with-water.
Come on now, didn't we all wanted these [easy] credit things?
No, I don't want easy credit because it inflate prices for people who don't want to become debt slaves.
(double-post)