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Stefaan De Rynck

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Stefaan De Rynck

Monthly Archives: February 2014

The German Judge and the Italian Banker

13 Thursday Feb 2014

Posted by Stefaan De Rynck in EU Politics, Leadership, Public Policy

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EU democracy, Germany, Karlsruhe, Mario Draghi, OMT

Wednesday, on a flight from Brussels to Boston, the NSA agent sitting next to me had a transcript from a telephone conversation between Herbert Landau, who is a judge on Germany’s Federal Constitutional Court, and Mario Draghi, President of the European Central Bank.

For non-Euro buffs, the German Court said last week that Draghi’s offer in 2012 to buy as much government bonds on the financial markets as he saw fit, which is widely claimed to have brought down the Euro crisis from scary heights, was most likely illegal under European Union law. But the final ruling will only come after the European Union court had its say.

Angela Merkel: "I usually do whatever it takes to avoid Karlsruhe rulings."

Angela Merkel: “I usually do whatever it takes to avoid Karlsruhe rulings.”

Herbert Landau in Karlsruhe calls Frankfurt …

Herbert: “Can I speak to Mario Draghi?”
Mario: “Speaking.”
Herbert: “What did you mean when you said you would do whatever it takes to preserve the Euro?”
Mario: “That I was ready to defend the Euro, no matter what.”
Herbert: “Is it really your job to defend the Euro?”
Mario: “Excuse me?”
Herbert: “Is that within your mandate, defending the Euro?”
Mario: “I would think so, I am the Central Banker.”
Herbert: “I see. I am the Constitutional judge of your largest shareholder.”
Mario: “I am the lender of last resort. It must be within my mandate to put up the last defence when markets attack. Markets are driven by animal spirits. I need to tame them.”
Herbert: “I am a constitutional judge; my job is to tame you. Did you act within the limits of your mandate? Did you consider more limited approaches to taming those markets?”
Mario: “Either the lion eats me, or I eat the lion. And to kill a lion I prefer a bazooka.”
Herbert: “You could use a handgun for that, no?” Continue reading →

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Crisis, deficits and democracy

10 Monday Feb 2014

Posted by Stefaan De Rynck in EU Politics, Leadership

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democratic deficit, EU democracy, EU elections, Parliament

As the May European elections are approaching for the 28 member countries, it is time to revisit the famous or rather infamous “democratic deficit” in European Union decision-making.

Singing Power to the People in Ancient Greece

Singing Power to the People in Ancient Greece

How democracy works in the European Union has shifted considerably over the last four years, when the Greek crisis erupted at the same as the new Lisbon Treaty entered into force. The Treaty changed the governance of the EU and was hailed as progress for democracy. Rightly so: it gave the European Parliament major new powers as a legislator. And it reinforced the Parliament’s capacity to overlook policy implementation by the Commission.

But the 2010 crisis made sure that the political action went elsewhere. The countries of the Euro Area came together to create new finance mechanisms under the firm and joint control of their Treasurers. This replaced their initial response of giving bilateral support to Greece. The European Central Bank pumped money in the banks and filled its balance sheet with state debt. Continue reading →

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  • Crimea and Kosovo, one stands where one sits
  • What kind of EU democracy is emerging?
  • The German Judge and the Italian Banker

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