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German FinMin defends rescure package for Greece

KARLSRUHE - Germany’s finance minister defended the rescue packages for Greece and other eurozone countries at a supreme court hearing Tuesday, as opponents argued that the bailouts violated both German and European law.

Wolfgang Schaeuble told the Federal Constitutional Court that «the stability of the euro is of paramount significance.» He pointed to the risk of financial instability across Europe and beyond at the time when the government signed on to the initial Greek rescue of May 2010 and also the wider eurozone fund created shortly afterward.

Those plans foresee Germany -- Europe’s biggest economy -- guaranteeing loans up to 22.4 billion euros($32.5 billion) for Greece and 147.6 billion euros for other countries.

Plaintiffs include Peter Gauweiler, a member of Chancellor Angela Merkel’s conservative bloc, who challenged previous European integration measures, and a group of professors.

Chief justice Andreas Vosskuhle said the court didn’t want to hear a debate on the measures’ economic merits, and that the right economic strategy was a matter for politicians and not judges. But, he said, his court «has to consider the limits that the constitution sets for politicians.» Karl Albrecht Schachtschneider, speaking for the professors, insisted that «what is economically wrong can’t be legally right.» He argued that the rescue measures violated a no-bailout provision in the European Union’s Lisbon treaty without sufficient justification.

He also contended that they violated German constitutional clauses protecting property and democracy _ the latter by restricting the German parliament’s control over its own budget.

"A union of liability and debt favoring other states has been created,» he said.

Gauweiler’s representative, Dietrich Murswiek, pointed to current efforts to set up a second Greek rescue package, arguing that loans would sink into a «bottomless pit.» «It’s like trying to repair water damage by blowing up the house,» he said.

In addition, «the rescue fund serves in reality to take risks away from certain big banks,» Murswiek contended, arguing that that would be unconstitutional.

Schaeuble said the government was on solid legal ground, and argued that «we Germans benefit even more from other Europeans from the currency union.» He pointed to German-led efforts to toughen rules governing the 17-nation euro and improve countries’ competitiveness -- efforts which he said need time -- and argued that no major stabilization measure had been taken without parliament’s approval.

"A common currency can’t do without the solidarity of all members,» Schaeuble said. In addition, he noted that «Greece has to fulfill very tough conditions.» Government lawmaker Siegfried Kauder, speaking on parliament’s behalf, said the measures were given full consideration by lawmakers and «no one was forced to vote in favor.» «It’s inaccurate to speak of a ’transfer union,» he said. «There is no ban on solidarity in European law. One doesn’t have to help, but one can.» A ruling is expected this year. [AP]

ekathimerini.com , Tuesday Jul 5, 2011 (14:00)  
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