We are the schmucks of Europe yet again!

So .... all this money for Greece, Portugal, Spain ... and it is to save the Euro




€750bn for Germany's bankrupt neighbours


We are the schmucks of Europe yet again!


11.05.2010 - 10:54 UHR
By Nikolaus Blome

The EU and the Eurozone want to spend a massive €750bn to save the European currency. Germany alone will have to fork out €123bn for its bankrupt neighbours.



But there is now not enough money for the planned tax cuts!

Are we really the schmucks of Europe?

Chancellor Angela Merkel said: “We are protecting the money of people in Germany.”

REALLY?

The vast credit line has been made available by the EU Commission, the International Monetary Fund (IMF) and Euro states to failing countries including Spain and Portugal. It allows them to borrow money if they cannot do so on the financial markets.

And the lion’s share of that cash – up to €123 billion – is coming from Germany. If it is not paid back, the taxpayer will be left out of pocket.

Just like with the Greek bailout!

In plain language: If more Euro states are forced to their knees under the weight of their debts, the countries which have not lived beyond their means for the last ten years will step in to help out. And above all that means Germany. Moderate wage agreements, moderate pensions schemes – but if needs be then we have to pay the bill.

And there is more falling by the wayside: With reference to ‘emergency’ article 122, governments can sidestep the Euro contract that…

…forbids the raising of credit by the EU Commission for Euro states;

…bars the European Central Bank (ECB) from buying bonds from Euro states;

…bans economically sound countries from helping out those in debt.

IN ORDER TO SAVE THE EURO, POLITICIANS ARE RISKING ITS FUTURE. WHY? WHAT PRESSURES ARE THERE TO DO THIS?

Flashback to the past Friday at an EU summit in Brussels: Until late in the evening the heads of state struggled to agree a deal on the billions in aid. ECB chief Jean-Claude Trichet eventually held a metaphorical pistol to their heads, warning – like IMF boss Dominique Strauss-Kahn – of a ‘meltdown’ the following Monday if nothing happened.

On Friday the money markets were hit just like they were before the Lehman Brothers collapse, sending out a red alert.

And so Chancellor Merkel capitulated. She knew that the policy was being pushed by the banks and financial markets. Yet again.

Negotiations on the details took place until Sunday evening. Merkel insisted that the emergency credit would only be available to a country which had become the subject of an IMF austerity programme AND that the majority of the credit (€440bn limited to three years) would be administered by Euro states and not the European Commission.

Nevertheless, barely anything remains from the original Euro stability contract. The stock markets reacted yesterday with a jump upwards (DAX was up 4.5 per cent), while the Euro itself rose only slightly.

Experts remain wary. No one knows what will happen in the long run.

Economics expert Christoph Schmidt told BILD: “We did really not want to have European monetary union like this. It happened the opposite way to what we Germans were told at that time under stable monetary policy and with an independent central bank.

“The Euro funds only bought the government time, nothing more.”

Members of parliament belonging to the two parties in Germany’s ruling coalition, the CDU/CSU and the FDP, are also wary of the ECB’s autonomy. They must decide on the aid package in the Bundestag over the next few weeks.

Ex-FDP head Wolfgang Gerhardt told BILD: “Such firefighting actions by the government like those at the weekend must in the future happen whilst allowing for the autonomy of the ECB.”

The FDP’s Patrick Döring demanded the rapid creation of a European ratings agency and banking charges.

And anyone who still believed there was enough money in Germany for a cut in taxes was put straight at 1:34 pm on Monday, when the Chancellor casually announced in a toneless voice: “Reductions in tax will in the foreseeable future not be achievable.”

 
 
 
 
 
 
 
 
 
 
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