Several months ago we first suggested that the only outcome of the ongoing antagonism between Germany, the now Goldman-controlled European central bank hell bent on generating inflation at any cost, and the rest of Europe's insolvent states, would be a German referendum in which the German people themsleves are asked what they think of the current mess Europe finds itself in. Naturally, days like today, when the ECB does away with inflationary caution and returns to tried and failed methods - because as a reminder conditional secondary market bond purchases are nothing new, and were last tried in the summer of 2011 when Italy became the latest entrant to the SMP program, and failed - is when the impetus for referendum would be highest. Sure enough, German Spiegel has come out with an article pulling precisely on this increasingly more festering wound for the German population.
From Spiegel [7]
It's Time to Ask the People What They Think
After World War II, the West gave Germany two great gifts. The first gift was democracy; the second gift was being integrated into a Europe of free nations. This also included the overriding vision that one day both gifts could be combined to create a democratic United States of Europe. But there was a lack of determination and strength to accomplish this. To make matters worse, both gifts have suffered from the attempt to use a common currency to integrate Europe. Postwar German democracy has never been in such a sorry state as today. It has been a long time since the peoples of Europe eyed each other with so much mistrust.
That is the current situation. Next week, Germany's Federal Constitutional Court will issue another ruling on Germany's euro policy. This is not expected to clear the air or fundamentally improve the situation. A court decision cannot accomplish that. But something must happen. We cannot allow both democracy and Europe to go to rack and ruin. Democracy and European integration form the foundations of our country. The problem is that they have come into contradiction with each other. Assuming the debt mania doesn't continue to spiral out of control, it's a fact that democracy impedes a rapid rescue for the euro, while a rapid rescue for the euro undermines democracy.
Such a contradiction begs a decision. What is more important to the Germans: their democracy or Europe? Or is there a way to reconcile the two, democracy and Europe? It isn't easy. It cannot be done without risks. But there is a way.
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The State of Europe
If one had to very briefly summarize what characterizes European history, it could look like this: Many of humanity's best ideas come from Europe -- such as democracy, the Enlightenment and the rule of law, along with great discoveries in the natural sciences. But all of this did not prevent Germany from sparking two world wars and carrying out the Holocaust. Despite utter devastation, the nations of Europe nevertheless managed to reconcile their differences and build the European Union.
It's no secret that Europe has always been an elite project. Many politicians in Germany thought that European unity was a good thing, and pursued it more or less surreptitiously, in any case without consulting the population. They built a Europe that suited them, without a strong parliament, but which had a strong bureaucracy and where national governments had great influence. They thought that this Europe would be so wonderful that one day its citizens would be delighted that it existed. This approach, dubbed "output legitimacy" by scholars, is based on achieving legitimacy via results.
It may not be perfect, but it's an acceptable method. Democracy is never flawless; it's never purely the rule of the people. Sometimes a country is governed contrary to the will of the people, or without taking it into account, at least for a certain amount of time. On top of the results that have been achieved, elections then provide a retroactive legitimacy.
But it was, as is now clear, a serious mistake not to link the introduction of the euro to the creation of a European financial government subject to parliamentary control. In its current form, the monetary union is no longer a success. Everyone did what they wanted. Some ran up debts that they could handle, while others ran up debts that they couldn't handle. And now we face a major crisis.
Europe is in a serious predicament. The unifying concept of peace in Europe has lost its appeal. The interests of the member states run counter to each other. Some want as much solidarity as possible in the crisis, while others want as little as possible. And there is no process to resolve these conflicts in a democratic and effective manner. Europe, then, is also in trouble.
Time to Ask the People
German democracy is suffering under Europe, while Europe is suffering under the national interests of the member states and the lack of a sensible political structure. That is the current state of democracy and Europe, the foundations of postwar Germany. What direction should we take now? Does democracy take priority over Europe? Or does Europe take priority over democracy?
There is a way to avoid this conflict. The Germans can reconcile their democracy with European integration. To do that, they would need to be asked.
Fundamentally, it is a good thing that we have a representative democracy where people go to the polls and politicians make decisions between elections. They have the expertise and the time to consider how society should best be organized. But sometimes we have to decide on the really big issues -- and then it is time to ask the people. The current crisis involves a really big question: Is the population prepared to transfer sovereignty to Europe so that effective euro policies are possible?
This doesn't mean that we have to rewrite the German constitution. It doesn't mean that we have to create a United States of Europe. For the time being, it's enough just to clarify the issue. From a legal perspective, it's not very easy, but it's possible. Where there's a will, there's a way.
The debate that would be held in the run-up to such a referendum would already be valuable in itself. Although the focus is fiscal policy, Germany would have to engage in a broader debate over what kind of Europe it wants and what its own role should be. The politicians would first have to make up their minds and then, assuming they make the right decision, campaign for greater integration. But this time they would use modern arguments in favor of Europe, such as a large shared culture, a greater say in global politics and favorable conditions for German exports.
If the politicians manage to convince the majority of the population, the German government would have a mandate to campaign in Europe for greater integration in terms of fiscal policy, in exchange for relinquishing sovereignty. It would then have a strong legitimization, a strong mandate for pro-integration policies. That would be the better scenario.
The worse scenario, of course, would also be possible -- but it wouldn't spell the end of Europe. The EU has already survived a French referendum that rejected the proposed European constitution. The German government could continue to work to help debt-stricken countries. This would be done in accordance with German budgetary law, which would not be weakened.
No matter what happens, democracy is the winner in such a referendum. The cause of European integration could win, but it could also suffer a setback. But this way the proper checks and balances are in place. After all, when push comes to shove, democracy ultimately has to come first.