Recovery Fund under attack / 2: that’s why it’s against the German Constitution. And Karlsruhe ignites the election campaign

We have presented the reasons why the Recovery Fund (Ngeu – Next generation EU ) may not be in compliance with the European Treaties. It is not over, because it is still necessary to present the reasons why it may not be in compliance with the German Basic Law.

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The Karlsruhe Court – On March 26, the Federal Constitutional Court of Karlsruhe (an old acquaintance of ours) issued a suspension order ( Hängebeschluss ) or, more precisely , an early provisional protection order for particularly urgent cases, in which no it can not even wait until the decision on the precautionary request for a temporary injunction, which applies until the Court has made a decision on the said precautionary request. With it, he literally ordered the President of the Republic not to issue the Law of Ratification of the Decision on EU Own Resources ( Eigenmittelbeschluss-Ratisierungsgesetz – Eratg ), "until the Court's decision on the request for the issuance of a provisional measure". To decide on the confirmation of the suspension, Bloomberg says it will take a few days, Reuters no more than three months, Lagarde hoped to face "in a short time". In addition to the suspension, five appeals have also been filed and, if the suspension is granted, then it could take years.

Sadly, and as President Barra Caracciolo teaches, the German Court flatly denies the presumed superiority of European law over constitutional law, as it is not provided for by the Treaties, but is the result of an elaboration by the European Court of Justice in rem propriam , that is, for the benefit of its own unilateral affirmation of supremacy. It denies it especially when it goes against fundamental interests of the States, which are not legally available to it. On this doctrinal basis, our Herdegen wrote a conspicuous article for the FAZ , which inspired a leading article of the FAZ entitled, more or less: “and Germany pays”. The other article by Benedikt Riedl is also interesting. The reasoned opinion expressed by the Federal Court of Auditors ( Bundesrechnungshof ) will be highly listened to in Karlsruhe.

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The arguments of the appeals – In a nutshell, there are five open problems:

(1) The " ultra-vires " juridical nature, ie tyrannical: the eventuality that the EU has exceeded, to a sufficient extent and in a qualified and structurally significant way, the powers attributed to it by the Treaty. And we talked about it in the previous article .

(2) The "constitutional identity" ( Verfassungsidentität ): pertains to the defense of the "principle of democracy", which is violated if the EU raises the Bundestag (present or future, the Ngeu lasts until the year 2058) from its budgetary responsibility . This also includes the prohibition to answer for decisions made by third parties to an extent that is difficult to calculate (in terms of amounts and / or timing). A principle which is also covered by an eternity clause ( Ewigkeitsgarantie ): to overcome it it would be necessary to terminate the Fundamental Law via referendum and the possibility that the German people approve it is zero quoto. According to Riedl, “the decisive question is whether Germany, if necessary, would alone be responsible for 750 billion. If there are no adequate guarantees in the system of the EU's own resources, a violation of budgetary responsibility and constitutional identity is a concrete problem ”. Consequently, "the constitutional denunciation has a good chance of success", within the meaning of the German Basic Law.

(3) The "over-guarantee", a problem that mirrors the previous one: even assuming that the EU has not asked for commitments of 789 billion euros from Germany in order to collect them all, then why did you ask for them? More generally, what does Brussels do with commitments of 3,000 billion euros? Is it not that, by chance, it intends to become “the shopping distributor in Europe”? Not a question of goat wool, given that Mario Draghi himself admitted: "the Commission, today, has seen its financial means expand, so it is likely that this type of financing will also be used for other things". Categorical the Bundesrechnungshof : "the maximum annual additional must be significantly reduced".

(4) The “constitutional debt brake” (115 Basic Law) requires that income and expenditure be balanced. But how to deal with the debt outside the federal budget but within the EU budget? And how to deal with future commitments and guarantees of disbursement to the EU?

(5) Then there is the lack of financial transparency: “where and how will the EU ignite a debt of 750 billion euros? Which institutions grant the loans? Does the Commission have a free hand in this? ”. We imagine targeted questions to ensure that it will not be the ECB to buy the EU debt… otherwise the ban on “monetary financing” would come back into play ( 123 Tfeu ). And we would be all over again. Especially since a judgment on the PEPP is pending. And all the more so since the old sentence of May 5, on the PSPP, is still awaiting execution and can strike again .

Only one problem has been solved, that of the consent of the Parliament with a majority above two thirds: the ratification law was approved by the Bundestag with a very large majority and by the Bundesrat unanimously . It's not cheap, but it's not enough either.

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The German elections – The issue will be at the center of the German electoral campaign, from now to the September elections. Great enthusiasm on the left, with Scholz (he suggests moving from unanimity to majority voting "on foreign, financial and fiscal policy"), Roth (he defined the own resources system as "a step towards fiscal union ”) And the Greens (who want not only to develop the Eurobond of the NGEU , but also that of the banking union and even that of the Mes ).

The CDU / CSU center, embalmed by the continuation of the lockdown , disciplinedly obeyed Merkel; but he is agitated by the fear of having given a gift to the AfD right (the only party openly opposed), so he eagerly defines the operation as a "one-off measure, limited in time and scope" and "with the sole and exclusive purpose of facing the consequences of the Covid crisis ". In fact, he was furious at the mere mention of the tax union . Meanwhile, the FAZ teases him by writing that he does not even believe in himself and challenges him to campaign for the modification of the Treaties.

Enough to get the suspicion that this is all a farce. Staged in order to keep the Euro alive at least as long as Covid lasts. In any case, Karlsruhe would have taken steps to bring everyone back to reality, at a minimal political cost for the German party power. Otherwise, they would have thought the Poles and Hungarians, in parallel struggling with an appeal against the Regulation on the rule of law , the latter strongly backed by the United clientes of Germany, but that cuts off the Poles and Hungarians from Ngeu.

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Possible consequences – In Italy, it is minimized. Ex-multis , Nielsen of UniCredit (partially denied by its researchers ) inexplicably denies that the Ngeu is guaranteed by the member states. Zagari sees a form of pressure on Draghi to make the reforms €. According to Fabbri (one who is convinced that we cannot leave the Euro ), the ordinance was written "by adhering to rules dictated by the United States", by a court created "to preserve the limits to German power commanded by Washington", with the inevitable outcome of "authorizing the Recovery Fund as a single measure, impossible to transform into a fiscal union between member states". Sic.

The Financial Times is very worried: "After the vaccine fiasco, the EU cannot afford a break in the Ngeu "; but even more worried because he realizes that "the problem cannot be easily solved, given the difficulty of changing the Basic Law", so that "a deep and vigorous debate in the German judicial establishment " on how to interpret it would be needed. So too Münchau : “for the EU, it would be a good idea to prepare a plan B”. Quadrio Curzio asked himself, after Draghi's speeches: “will the Draghi-Macron duo be enough to convince the penalty takers of the Eurozone? We really hope so because the current crisis could be irrecoverable if too much time passes before the recovery ”. Here, no: it will not be enough. Hence, the current crisis of the Euro is irrecoverable. But no fear, this does not threaten to destroy the single market, Gentiloni had explained: "the recession from Covid threatens to destroy the euro zone". Amen and so be it.

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This is a machine translation from Italian language of a post published on Atlantico Quotidiano at the URL on Tue, 06 Apr 2021 03:58:00 +0000.