As one of the applicants to Germany’s constitutional court, I feel your editorial “How to deal with a problem like Karlsruhe” (FT View, March 30), on the successful bid to block ratification of the EU recovery fund misinforms your readers.
Our group comprises 2,281 German citizens, led by university professors, mostly in the areas of economics or business administration. There is no involvement of any political party.
Unfortunately, the editorial is based on at least two erroneous perceptions.
First, European constitutional law determines that the European budget must be financed “wholly from own resources”. The European Council gave a complete list of the union’s own resources.
Funds raised by the EU via public debt are not included. Hence, empowering the union to issue sovereign bonds is an ultra vires act and violates the EU treaty.
Second, the mutualisation of debt violates the sovereign budget rights of the Bundestag (and of the parliaments of other member states). While the EU will raise debt of €750bn, the “own resources” decision makes Germany liable for approximately €1tn in interest and principal (0.6 per cent of gross national income for 38 years). If other member states do not service the debt or leave the bloc, the commission is empowered to call on the required funds from Germany up to this amount.
Germany’s basic law guarantees the Bundestag democratic control over taxpayers’ resources. It is the well-established function of the German constitutional court to preserve the powers of parliament. A liability of roughly €1tn beyond parliamentary control is a constitutional challenge Germany’s constitutional court must deal with.
Given this, there is neither reason to blame any alleged “Eurosceptics” nor to believe roadblocks would be erected to the recovery efforts; nor is there any basis to blame the court “as a persistent impediment to eurozone reform efforts”. The court sticks to its mandate only.
Of course, the Bündnis Bürgerwille or Alliance of Citizens’ Will, as our group is called, is firmly convinced that member states should accept large debts to help those who are innocently endangered in their economic existence or who need medical support. But those debts must be incurred in line with applicable law.
Professor Bernd Lucke
Winsen, Germany