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In story: Karlsruhe and German exceptionalism

Re: Karlsruhe and German exceptionalism
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Who in Germany would make such an appeal? But, if made, the almost certain decision would starkly clarify the legal situation. It is the ordoliberals in Germany who object. That is ironic as the rules established by the treaties forming the EU seem pretty clear on the relevant points as outlined by Frank. It would seem that it is not an argument about hierarchical order, which clearly places the EUJC at the top of the legal heap, but rather one about Germany's place in the hierarchy. What were these same ordoliberals thinking when the treaties were being negotiated?

by ARGeezer (ARGeezer a in a circle eurotrib daught com) on
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In story: The Primacy of EU law

Re: The Primacy of EU law
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This diary is an upgraded version of a comment as it is rather long and complex and deserves a discussion in its own right. I am happy to be corrected on any points I have made as I am not a lawyer, and certainly not familiar with the legal system in other countries.

It seems to me the Irish constitutional amendments incorporating EU Treaties into the Irish Constitution were drafted in the way they were in order to remove precisely the sort of confusion introduced by the Karlsruhe judgement as to who decides whether ECB actions are within their Treaty given powers and indeed proportionate in terms of their economic effects.

I would have thought it self evident that decisions as to the necessity for and expected impact of ECB decisions are the statutory purview of the ECB Board and their expert economists, and beyond the competence of non-economists and non-bankers like the Karlsruhe Court.

If the ECB has exceeded its Treaty given powers in some way, that is clearly justiciable by national courts subject to final appeal to the CJEU. It is the denial of the CJEU's final say on the legality or otherwise of the ECB's actions which I believe undermines the entire legal order of the EU.

It is also open to Germany to seek a negotiated change in the role of the ECB by way of amendment to existing Treaties, but that would require unanimous political support and a referendum in some countries. If such a Treaty amendment were contemplated by Germany, I would certainly be advocating a broadening of the ECB's role in targetting employment levels as well as inflation, and ensuring the stability and balancing trade and capital flows throughout the entire EZ system.

It is not only deficit countries that require "reform", but surplus countries which refuse to reflate their economies in order to re-balance Intra-EZ capital and trade flows. If Germany wants to continue to sell Mercedes to Greece it must ensure that it imports sufficient Greek produce to enable the Greeks to pay for them.

At the heart of the debate is the German Lutheran equivalence of debt and blame - "schuld" - when in economic terms every debt has a creditor and neither is more morally upright than the other. German attempts to push their trading partners into debt is literally a case of trying to push the blame on them for a German failure to ensure the terms of trade within a common currency zone are balanced. The only alternative would be a break-up of the EZ so that national currencies can once again float freely against one another in as a means of balancing trade flows.

Negative interest rates could do the same job but no doubt Herr Huber would have a problem with that as well if the ECB pursued them to their logical conclusion. Ultimately a court of law is not an appropriate place to decide whether interest rates or bond buying programmes are "proportionate" to their economic effects. Otherwise we might as well replace the ECB with the German Constitutional Court.

by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on
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In story: Karlsruhe and German exceptionalism

Re: Karlsruhe and German exceptionalism
( / )
I have revised and upgraded the above to a new diary as it is rather long and complex and deserves a discussion in its own right. I am happy to be corrected on any points I have made as I am not a lawyer, and certainly not familiar with the legal system in other countries.

It seems to me the Irish constitutional amendments incorporating EU Treaties into the Irish Constitution were drafted in the way they were in order to remove precisely the sort of confusion introduced by the Karlsruhe judgement as to who decides whether ECB actions are within their Treaty given powers and indeed proportionate in terms of their economic effects.

I would have thought it self evident that decisions as to the necessity for and expected impact of ECB decisions are the statutory purview of the ECB Board and their expert economists, and beyond the competence of non-economists and non-bankers like the Karlsruhe Court.

If the ECB has exceeded its Treaty given powers in some way, that is clearly justiciable by national courts subject to final appeal to the CJEU. It is the denial of the CJEU's final say on the legality or otherwise of the ECB's actions which I believe undermines the entire legal order of the EU.

It is also open to Germany to seek a negotiated change in the role of the ECB by way of amendment to existing Treaties, but that would require unanimous political support and a referendum in some countries. If such a Treaty amendment were contemplated by Germany, I would certainly be advocating a broadening of the ECB's role in targetting employment levels as well as inflation, and ensuring the stability and balancing trade and capital flows throughout the entire EZ system.

It is not only deficit countries that require "reform", but surplus countries which refuse to reflate their economies in order to re-balance Intra-EZ capital and trade flows. If Germany wants to continue to sell Mercedes to Greece it must ensure that it imports sufficient Greek produce to enable the Greeks to pay for them.

At the heart of the debate is the German Lutheran equivalence of debt and blame - "schuld" - when in economic terms every debt has a creditor and neither is more morally upright than the other. German attempts to push their trading partners into debt is literally a case of trying to push the blame on them for a German failure to ensure the terms of trade within a common currency zone are balanced. The only alternative would be a break-up of the EZ so that national currencies can once again float freely against one another in as a means of balancing trade flows.

Negative interest rates could do the same job but no doubt Herr Huber would have a problem with that as well if the ECB pursued them to their logical conclusion. Ultimately a court of law is not an appropriate place to decide whether interest rates or bond buying programmes are "proportionate" to their economic effects. Otherwise we might as well replace the ECB with the German Constitutional Court.

by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on
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In story: Chloroquine Clinical Trials - Oxford U & Bill Gates

Re: Ferguson Had To Resign, Cummings Stays
( / )


by Oui on
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WHO pauses trial of hydroxychloroquine in COVID-19 patients due to safety concerns
most litigious, known side-effects, "abundance of caution"
archived chloroquine phosphate, chloroquine, and hydroxychloroquine
contra-indicated dosage ("toxicity") and ventricular arrhythmias for each

by Cat on
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In story: June 2020

The Grauniad
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Don't they have editors any more?
Brazil's embattled president, Jair Bolsonaro, has come under further pressure after his political idol Donald Trump imposed an travel ban on non-US citizens coming the South American country in response soaring number of Brazilian coronavirus cases.

The US announced the measure on Sunday as the number of recorded cases in Brazil rose to more than 363,000 and the death toll nearly 23,000.

Only the US now has more confirmed infections than Brazil where Bolsonaro has faced severe criticism for flouting social media guidelines and losing two health ministers in less than a month.

by gk (gk (gk quattro due due sette @gmail.com)) on
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by Cat on
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In story: Karlsruhe and German exceptionalism

Re: Karlsruhe and German exceptionalism
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I am upbraided by an email correspondent for this article as follows:
Dear Mr. Schnittger,

as long time reader of the I usually agree with most of you opinions. However, your comment on the German decision of the Bundesverfassungsgericht misses by far the point in a few instances.

The major issue of the Judge Huber was  that in Germany (and according to Huber also other countries) the Basic Law/constitution sets the highest bar, it cannot be changed by a European court. There was and is a conflict that has to be solved.

"If the German court can be allowed to superimpose its own judgement on an EU policy it doesn't like, what's to prevent all other member states doing the same?" only points to the fact, that you do not understand the issue. To complain that a German judge points to this conflict is therefore weak, the EU is not one country, it is a union of sovereign states, that causes problems. Ignoring the problems solves nothing.

"Is the Merkel/Macron proposal for the EU to borrow and spend €500 Billion a direct response to the Karlsruhe ruling?"

Again a miss by a wide margin. There was never a discussion whether there is support for the countries hit hardest by the corona visrus epidemic, only the legal framework was. The judge Huber did NOT exclude some means, he only requested a better reasoning, this should be easy for the EU. And a larger EU budget as suggested for the 500 billion EUR is of course perfectly within the legal framework given by judge Huber.

"Far from being slow to condemn Karlsruhe, Ireland should be equanimous about the prospect of Germany leaving the Eurozone, if that is what it really wants to do, as the logic of the Judges ruling seems to suggest."

Nonsensical conclusion.

Best regards in the hope to read high quality article in future again.

Taking a few of the points in turn:
Point 1: "The major issue of the Judge Huber was  that in Germany (and according to Huber also other countries) the Basic Law/constitution sets the highest bar, it cannot be changed by a European court."

We are talking here about the actions of the ECB, which is an EU institution created by the Treaties and subject only to EU law. The Huber judgement also explicitly tries to overturn case law created by the CJEU since 1964. It is simply not empowered to do so.

The primacy of EU Law over national law and the CJEUs pre-eminent role in interpreting it is enshrined in Annex 17 of the Treaty of Lisbon.

Other countries, including Ireland for example, explicitly acknowledge this in their own constitutions:
Article 29.4.6 of the Irish Constitution

6º No provision of this Constitution invalidates laws enacted, acts done or measures adopted by the State, before, on or after the entry into force of the Treaty of Lisbon, that are necessitated by the obligations of membership of the European Union referred to in subsection 5 of this section or of the European Atomic Energy Community, or prevents laws enacted, acts done or measures adopted by--

    i. the said European Union or the European Atomic Energy Community, or by institutions thereof,
    ii. the European Communities or European Union existing immediately before the entry into force of the Treaty of Lisbon, or by institutions thereof, or
    iii. bodies competent under the treaties referred to in this section,

from having the force of law in the State.

So by your logic that EU law is subservient to German Basic Law, and with Irish law being explicitly subservient to EU law, Ireland is now effectively being ruled by Germany?? This will be news to many here.

Point 2: "EU is not one country, it is a union of sovereign states"

It is a union of sovereign states which have agreed by Treaty to pool certain aspects of their sovereignty and to vest decision making authority in those areas in the 7 institutions of the EU, including the ECB and CJEU. Why do you think the Brexiteers were so intent on escape from under the yoke of the CJEU? They recognised that British law is subservient to EU law for as long as they remained a member.

Point 3: "There was never a discussion whether there is support for the countries hit hardest by the corona visrus epidemic, only the legal framework was. The judge Huber did NOT exclude some means, he only requested a better reasoning, this should be easy for the EU."

The German constitutional case pre-dates the Covid-19 pandemic and is concerned largely with opposition to the Quantitative Easing programmes initiated by Draghi, which have had the economic effect of reducing interest rates paid by net deficit countries such as Italy, and reducing interest received on savings by net savers such as Germany.

It is therefore understandable that many in Germany should oppose QE, even though it is actually necessitated by German insistence on running net export and current account surpluses which force other EZ countries into deficits. Normally Governments such as the US rectify such imbalances through net fiscal transfers from richer states to poorer ones, something which is now also, belatedly, being proposed by Merkel/Macron.

But in the past and current absence of such fiscal transfers, the EZ has had to rely ever more heavily on the ECB to rectify those imbalances, although QE has also been used, increasingly by the FED and Bank of England to prevent large parts of their economies falling into recession.

If Mr. Huber needs this explained to him, then fine. Any competent economist not trained exclusively in the Ordoliberal tradition can do so. But it is not the function of the ECJ to do so as it is not answerable to the German Constitutional Court and what it regards as "proportionate" or otherwise.

Manipulating interest rates is part of the basic policy tool-kit of any central bank in controlling inflation and preventing recessions: Not too many Germans were complaining when the ECB kept interest rates artificially low to help fund German re-unification, even though those ultra low interest rates led to an otherwise avoidable property and asset boom and greatly exacerbated the 2008 crash in Ireland and other EU member states.

The reality is that any ECB policy will be more or less appropriate for the economic interests for any one member state at any given point in time. That is the compromise inherent in any common currency covering widely divergent economies.

Mr. Huber went far further than just requesting a better explanation. He explicitly rejected previous CJEU rulings as absurd and declared that Germany should not be subject to them. If Germany has not properly inserted the primacy of EU law into its constitution, that is a problem for Germany to resolve. It is Germany's membership of the EU and EZ that is put in question by Mr. Huber, no one elses.

You do not appear to realise how grave an insult Mr. Huber's ruling is to the rest of the EU, and how it cannot be left to stand if the whole legal order of the EU is not to be undermined. Merkel recognised this, but in typical Merkel fashion chose to skirt around the issue by proposing a fiscal stimulus package instead. It does not look good for any government to oppose a finding by its supreme court.

However the ECB will ignore the ruling and the CJEU may take a long time to slap it down, unless some court case or other gives it an opportunity to do so. The European Commission will probably only bring infringement proceedings against Germany if the BundesBank fails to meet its obligations under the Treaties. The findings of a rogue institutional court are of no direct relevance to it. But it would be a pity if Germany were to join Hungary and Poland with infringement proceedings pending against it.

Perhaps Philip Lane, ECB chief economist will issue some ex-cathedra statement on the economic impact of QE measures which are widely credited with saving the EZ from recession. The EU usually finds some way to muddle through a crisis without explicit endorsing extreme positions. But you can expect much more QE in the years ahead if the Pandemic is not to result in an even deeper recession. The Eurozone's survival, or Germany's position within it are at stake.

by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on
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In story: Chloroquine Clinical Trials - Oxford U & Bill Gates

Re: Ferguson Had To Resign, Cummings Stays
( / )

Tory whips apologise for urging MPs to support Dominic Cummings | The Guardian |

The revelation prompted several senior members of government to tweet their support for Cummings, including the chancellor, Rishi Sunak, the health secretary, Matt Hancock, the foreign secretary, Dominic Raab and Cummings's close ally, Michael Gove.

Inside Downing Street, they believed they could see off damage from the story by focusing on Cummings's wish to protect his son in case both he and his wife were struck down by the disease. A source said: "They were saying, `The kid is the trump card.'"

by Oui on
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In story: Chloroquine Clinical Trials - Oxford U & Bill Gates

Big Pharma and Reluctance for Pathogen Research
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The revelation is contained in a report published by the Corporate Observatory Europe (COE), a Brussels-based research centre, examining decisions made by the IMI, which has a budget of €5bn (£4.5bn), made up of EU funding and in-kind contributions from private and other bodies.
The IMI's governing board is made up of commission officials and representatives of the European Federation of Pharmaceutical Industries (EFPIA), whose members include some of the biggest names in the sector, among them GlaxoSmithKline, Novartis, Pfizer, Lilly and Johnson & Johnson.


by Oui on
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In story: June 2020

Re: People and Klatsch
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Nice! Someone noticed ... 😉

by Oui on
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In story: June 2020

Re: People and Klatsch
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Scary isn't it! 🎭

Open space ... not open skies what Trump defies ...

by Oui on
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In story: June 2020

Re: People and Klatsch
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Wow, a new Newsroom!
by Zwackus on
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by Cat on
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Well obviously the Commission will want its grants to further "sound economic policies and reform agendas", who could possibly object to that? The issue is who gets to decide what is "sound", and the Commission has tended to be more progressive than ordoliberal ideologues would like.

Ireland has long accepted that its tax competitive advantage will be eroded with time, and the case for taxing the Amazon's of this world on their sales in each country - like every bricks and mortar retailer - is simply unanswerable, as even UK Tories accept.

The biggest obstacle to that is Trump, as all the big global on-line operators are US, and so taxing them on their sales in each market inevitably reduces their profitability and tax yield to the US.

I have been surprised that EU members haven't been more assertive in imposing them in retaliation for Trumps tariff impositions, but perhaps the only thing holding Trump back is the fear that they will.

by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on
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In story: Chloroquine Clinical Trials - Oxford U & Bill Gates

Re: Ferguson Had To Resign, Cummings Stays
( / )


by Oui on
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In story: June 2020

How many Democrats does she plan to kill?
( / )
Forward
A New York City lawmaker told a Jewish audience that she knows what it was like for Israeli soldiers to fight in the Six Day War because she's "a Republican in New York City."
Then
When you think about the small army at the time that Israel had and that they were confronted with five armies -- I mean, I'm a Republican in New York City so I can kind of understand what they may have been going through or thinking," Malliotakis said, according to the report, which included a link to the recorded Zoom call.
THe five arny myth (consisting much fewer soldiers) refers to the war of independence, not the1967 war/
by gk (gk (gk quattro due due sette @gmail.com)) on
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In story: Laissez-faire Handling Outbreak by PM Boris Johnson

Re: 19 April celebrity endorsement UPDATE
( / )
by Cat on
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The Irish Times is reading the small print too:

EU mutual debt plan will come with a price tag for Ireland - P.Leahy

But like everyone else, Ireland will have to accept things we don't like if the plan is to work. The small print of the proposals stipulates that the grants to states will only be made in return for commitment to follow "sound economic policies and reform agendas".

In addition the Franco-German plan requires tax reforms that will improve the "framework for fair taxation", in particular of the digital economy. This is code for pressure on Ireland's tax revenues from digital multinationals. Some complex and difficult trade-offs await the next government.

by Bernard on
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In story: Chloroquine Clinical Trials - Oxford U & Bill Gates

Health Guidance For All Londoners But Cummings
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by Oui on
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In story: Chloroquine Clinical Trials - Oxford U & Bill Gates

Re: Ferguson Had To Resign, Cummings Stays
( / )


by Oui on
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In story: Chloroquine Clinical Trials - Oxford U & Bill Gates

Re: Ferguson Had To Resign, Cummings Stays
( / )


by Oui on
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In story: June 2020

TRUMP'S USA: Jarring Number of 100,000 US Deat
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    As the national death toll from COVID-19 approaches the stunning 100,000 milestone, The New York Times is devoting its entire Sunday May 24 front page to a list - a partial list - of the dead.

New York Times Publishes Names of People Who Died of COVID-19 on Entire Front Page | Newsweek |

Close relationship how people and capitalism treat planet Earth.

Every year, dirty air still brings more than 100,000 American lives to a premature death. Depleting resources.

Choked: The Age of Air Pollution and the Fight for a Cleaner Future

by Oui on
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In story: PPE Scandal In the Trump Swamp @DC

Jarring Number of 100,000 US Deaths
( / )

    As the national death toll from COVID-19 approaches the stunning 100,000 milestone, The New York Times is devoting its entire Sunday May 24 front page to a list - a partial list - of the dead.

New York Times Publishes Names of People Who Died of COVID-19 on Entire Front Page | Newsweek |

Close relationship how people and capitalism treat planet Earth.

Every year, dirty air still brings more than 100,000 American lives to a premature death. Depleting resources.

Choked: The Age of Air Pollution and the Fight for a Cleaner Future

by Oui on
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by Cat on
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In story: Karlsruhe and German exceptionalism

Re: Karlsruhe and German exceptionalism
( / )
France's dedication to Germany is what is preventing a realignment - unless Germany leaves the EuroZone unilaterally. This doubtless springs from the trauma of France being defeated in two world wars. But how likely is it that a breakup with Germany leaving the EuroZone would lead to a war today. Germany cannot even bring itself to fund its military adequately.


by ARGeezer (ARGeezer a in a circle eurotrib daught com) on
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In story: June 2020

Biden Shocks the Jewish Community
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by Oui on
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In story: June 2020

EUROPE: Last German POW Dies In Moscow
( / )

Berlin WW2 bombing survivor Saturn the alligator dies in Moscow Zoo | BBC News |

by Oui on
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I am not convinced the ECB will be in the slightest bit constrained. A simple statement by the Bundesbank that any action i takes in support of the ECB is proportionate should do the trick. Failure, on the part of the Bundesbank to take on its responsibility in this regard will trigger infringement proceedings by the Commission.

by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on
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the Broadway Miranda report
"breaks taboos" or change the game the way the U.S. Revolutionary War hero Alexander Hamilton did when he federalized the debts of the various U.S. states [?] in 1790.
Debts owed to and by the US fed "treasury" (of Spanish milled dollars and British sterling) to individual merchants d/b/a private bankers: Those were the "founding fathers", who also defaulted on payments to "continental soldiers". Several decades and financial panics (and "bailouts") after Hamilton died, the US Congress established surety binding states' legislatures' ahh public works to the "full faith and credit" of federal tax collections.

And not for the last time, I'm sure:
An Economic Interpretation of the United States Consitution, tl;dr 366 pp

pp xiv-xv, Introduction. The account of pyramid scheming reveals only more grim, systematic intrigues culminating in a timely fire, extinguishing records.

by Cat on
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News and Views

 June 2020

by Oui - May 22, 31 comments

Your take on this month's news

 December 2019

by Colman - Dec 11, 530 comments

Your take on this month's news


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