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Coughlan - The latest extraordinary proposal from Germany for the Eurozone

The front-page headline on today's Financial Times is: "CALL FOR EU TO CONTROL GREEK BUDGET "

The opening paragraphs of this FT report, under the bylines of Peter Spiegel in Brussels and Karin Hope in Athens, read as follows:-

"The German government wants Greece to cede sovereignty over tax and spending decisions to a Eurozone ‘Budget commissioner’ to secure a second €130 bailout, according to a copy of the proposal obtained by the Financial Times.

"In what would amount to an extraordinary extension of European Union control over a member state, the new commissioner would have the power to veto budget decisions taken by the Greek government if they were not in line with targets set by international lenders.

"The new administrator, appointed by other eurozone finance ministers, would have responsibility for overseeing ‘all major blocks of expenditure’ by the Greek government.

" ‘Budget consolidation has to be put under a strict steering and control system,’ the proposal reads. ‘Given the disappointing compliance so far, Greece has to accept shifting budgetary sovereignty to the European level for a certain period of time.’ "

"Athens would also have to adopt a law permanently committing state revenues to debt service ‘first and foremost’.

“The German plan, circulated yesterday afternoon to finance ministry officials from eurozone countries who make up the so-called ‘euro working group’, undescores the depths of mistrust between Greece and its EU lenders .”

This extraordinary proposal indicates how Germany regards its fellow “partners” amongst the PIIGS countries in the Eurozone.

It shows what Ireland can expect as long as we remain members of the Eurozone and fail to give priority within it to committing state revenues to debt service “first and foremost”.

This is what “shifting reponsibility to the European level” entails !

The main article on the front page of this morning's Irish Times states that European Central Bank President Mario Draghi remarked in Davos yesterday that the Fiscal Stability Treaty which the EU Heads of State and Government are expected to agree on Monday “will result in a diminution of sovereignty over budgetary policy in participating countries”.

At least that is honest talking, compared to the dishonest guff which is likely to be inflicted on the Irish public if the country should be required to hold a constitutional referendum on the new Treaty.

Presumably tomorrow's European Sunday newspapers will follow up this Financial Times report, but assuredly it should make every democrat throughout Europe take alarm.

Anthony Coughlan Director – The National Platform EU Research and Information Centre

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This document was last modified by Mick Carty on 2012-01-30 11:35:06.
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