Wednesday

25th Apr 2018

German opposition: only eurobonds can save the single currency

  • Gabriel accused Merkel of sneaking in eurobonds by the back door (Photo: spd.de)

The German opposition has endorsed plans for a national referendum on creating a full-blown fiscal Union.

The leader of the centre-left SPD party, Sigmar Gabriel, rolled out the proposals at a small press conference in Berlin on Monday (6 August).

Thank you for reading EUobserver!

Subscribe now for a 30 day free trial.

  1. €150 per year
  2. or €15 per month
  3. Cancel anytime

EUobserver is an independent, not-for-profit news organization that publishes daily news reports, analysis, and investigations from Brussels and the EU member states. We are an indispensable news source for anyone who wants to know what is going on in the EU.

We are mainly funded by advertising and subscription revenues. As advertising revenues are falling fast, we depend on subscription revenues to support our journalism.

For group, corporate or student subscriptions, please contact us. See also our full Terms of Use.

If you already have an account click here to login.

He said the euro can only be saved by pooling debt and sovereignty.

"You will not be able to hold the euro together without a common financial and tax policy ... We have a common currency, but no common finance or budget policy."

He also accused Chancellor Angela Merkel of trying to introduce joint EU debt by the back door in letting the European Central Bank (ECB) buy distressed Italian and Spanish bonds.

"The secret launch of joint debt via the ECB is the policy of the current government and it is wrong because the control mechanisms are not in place," he added.

Gabriel did not explicitly mention holding a referendum on the changes.

But he endorsed a position paper published on Saturday in the Frankfurter Algemeine Zeitung and on the SPD website which calls for a popular vote.

The essay - by German philospher Jurgen Habermas, economic expert Peter Bofinger and another SPD member, Julian Nida-Rumelin - says that Germany, as the largest EU "donor" country, should lead by example by holding a popular vote on altering the German constitution.

It also says that the European Parliament should be given more power so that there is no "taxation without representation" in the new-model EU.

The writers urged the creation of "joint liability for government bonds in the euro area" backed up by a "significant deepening of integration" to impose fiscal discipline.

They added: "There are only two coherent strategies for overcoming the current crisis: either a return to national currencies in the EU, with each country subject to unpredictable fluctuations in highly speculative currency markets, or the institutional consolidation of a common fiscal, economic and social policy in the euro area."

Gabriel's gambit signals the start of political manouvering ahead of German elections due in September or October next year.

His programme was immediately savaged by members of the ruling coalition parties, the centre-right CDU and CSU and the liberal FDP.

Merkel spokesman Georg Streiter said the a German referendum "lies a very long way in the future" and that ECB bond-buying "lies within its mandate."

CDU trade unionist Michael Meister said "Gabriel's proposal amounts to [German] workers, pensioners, savers and entrepreneurs paying for the debts of other member states."

FDP leader Rainer Bruederle said eurobonds mean "spending money that you don't have and then letting others pay for it."

The CSU chief Alexander Dobrindt, for his part, called the SPD leader a "public danger."

Merkel links federal election with Europe

Next year's federal elections in Germany will be about Europe, said Chancellor Angela Merkel, who has spent the past two years shaping the eurozone's answer to its debt crisis in the face of scepticism at home.

Germany gets its way on ECB bond-buying

The ECB has said it "may" buy Spanish and Italian bonds, but only if governments first sign reform pledges with the eurozone's bailout fund - a German demand.

MEPs struggle to keep Eurobonds idea alive

MEPs have kept alive support for joint liability Eurobonds despite critics describing the plan as "a socialist loonie-land" and a way to create a transfer union by the back door.

Macron and Merkel pledge euro reform

France and Germany have pledged to forge a joint position on euro reform by June, despite German reluctance on deeper monetary union.

News in Brief

  1. Far-right attack migrants on Greek island
  2. Merkel defends accepting UN refugees
  3. EU commissioner plans Malta 'money laundering' inspection
  4. Survey: Half of high polluting farms receive CAP subsidies
  5. Commission will 'not shy away' from Malta killing repercussions
  6. EU Commission opens probe on Alitalia state loan
  7. Paris suspect given 20-year sentence for Brussels shoot-out
  8. Merkel and Pena Nieto praise EU-Mexico trade agreement

Stakeholders' Highlights

  1. Nordic Council of Ministers12 Recommendations for Nordic Leadership on Climate and Environment
  2. Macedonian Human Rights MovementOxford Professor Calls for an End to the Anti-Macedonian Name Negotiations
  3. ACCAPeople Who Speak-Up Should Feel Safe to Do So
  4. Mission of China to the EUProgress on China-EU Cooperation
  5. Nordic Council of MinistersWorld's Energy Ministers to Meet in Oresund in May to Discuss Green Energy
  6. ILGA EuropeParabéns! Portugal Votes to Respect the Rights of Trans and Intersex People
  7. Mission of China to the EUJobs, Energy, Steel: Government Work Report Sets China's Targets
  8. Martens CentreJoin Us at NET@WORK2018 Featuring Debates on Migration, Foreign Policy, Populism & Disinformation
  9. European Jewish CongressKantor Center Annual Report on Antisemitism Worldwide - The Year the Mask Came Off
  10. UNICEFCalls for the Protection of Children in the Gaza Strip
  11. Mission of China to the EUForeign Minister Wang Yi Highlights Importance of China-EU Relations
  12. Nordic Council of MinistersImmigration and Integration in the Nordic Region - Getting the Facts Straight

Latest News

  1. Juncker delays air quality action due to busy agenda
  2. Spain makes bid for EU naval HQ
  3. How Russian propaganda depicts Europe - should we worry?
  4. MEPs tell Chinese ambassador of concerns on trade
  5. Greenland votes with eye on independence
  6. EU court delivers blow to anti-abortion activists
  7. Hungary activists defiant after 'Soros Mercenaries' attack
  8. European Commission proposes whistleblower protection law