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Finance Minister pushes for EU fiscal union

The Local · 16 Oct 2012, 17:59

Published: 16 Oct 2012 17:59 GMT+02:00

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According to the Handelsblatt newspaper, Chancellor Angela Merkel and Finance Minister Wolfgang Schäuble want their European partners to embrace the idea of a "fiscal union."

On his return from a five-day trip to Asia, Schäuble said it was time to take "bigger steps" in that direction - which would also entail "changing European treaties in one place or another."

The finance minister's call comes just ahead of a key EU summit set to start on Thursday.

During his visit to Singapore, Schäuble dismissed speculation of a Greek exit from the eurozone, saying he did not believe Athens would go bankrupt.

Yet preliminary estimates by the "troika" of Greece's international creditors - the European Commission, European Central Bank and International Monetary Fund - point to a grim picture.

Last month, news magazine Der Spiegel said troika experts estimated that Athens was facing a budget shortfall of about €20 billion.

Handelsblatt said Berlin was prepared to work toward a solution on the Greek issue - but EU treaty reform would be the price Germany demanded for those efforts.

More than anything, the German finance minister is looking to give a European currency commissioner the power to reject budget plans that conceivably violate the EU fiscal pact - and force those countries to go back to the drawing board.

Story continues below…

Under current rules, the EU Commissioner for Economic and Monetary Affairs, Olli Rehn, can only recommend that a country rework its budget with other EU commissioners' backing. Schäuble wants the bloc's money chief to have more authority - though a country's legislature would decide whether to address the budget shortfall through tax hikes or savings.

But a spokeswoman for European Commission President José Manuel Barroso said Tuesday that Rehn already plays an important role and enjoys "much respect."

The Local/DPA/arp

The Local (news@thelocal.de)

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Your comments about this article

19:13 October 16, 2012 by The-ex-pat
I was under the impression that it is fiscal union and there by fudging the books so that all sing the same song a the same time is the reason for the mess we are in now.......................Some people will never learn!!!!!
19:29 October 16, 2012 by Englishted
"changing European treaties in one place or another."

Just try putting it to a vote and this time accepting the result when it goes against you .

Plus it will break the E.U. as only members who are in the €uro and can be bullied by German could join ,if the €uro is as good as he says he will have no problem ,"there are none so blind as those that will not see".
21:13 October 16, 2012 by rugbycoach
Truth is that there must be a shared central bank with EU having control or nothing. The debt mountain is too high and the current treaties not strong enough. Its all or nothing for some nations at least. in that case the prediction is that the Euro will be left with only 2 large members France and Germany, with Netherlands and a couple of other minor countries hanging in there. Euro Cant survive otherwise. simple really..Then the currency wont be big enough to count.
09:55 October 17, 2012 by puisoh
As long as money is debt-based, there will be no way out.

Why is no one courageous enough to re-introduce sound-money, backed by gold or silver.

Drawing up treaties, signing and changing afterwards is not as hard as sticking to them. Discipline is truly missing .. is it really so hard to understand. NO one is wasting their lives as much as these bunch of crooks.... on public expense of course.
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