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German President Puts Country on Hook for Over a Quarter of EU’s New $600B Bailout Fund

Sep. 14, 2012 1:00am Becket Adams

President Joachim Gauck Signs off on Creation of ESM

New German President Joachim Gauck delivers his speech after the oath of office at the parliament in Berlin (AP)

Germany’s president signed off Thursday on the eurozone’s permanent €500 billion ($645.5 billion) rescue fund and Europe’s budget-discipline pact, bringing the continent’s supposed financial firewall a step closer to completion.

President Joachim Gauck signed the legislation a day after Germany’s Federal Constitutional Court rejected calls for an injunction blocking the measures, his office said.

However, the court did insist that Germany fulfill some conditions — notably, ensuring there are legal guarantees that Parliament must vote on any further increases in Germany’s contributions to the fund, the European Stability Mechanism. Germany is liable for about 27 percent of the European rescue program.

For those of you playing at home, that’s approximately €190 billion ($250 billion).

Gauck’s office said that once the government has fulfilled those conditions, the ESM still requires a further formal step of ratification by the president to take effect. The new fund’s board of governors is slated to hold its first meeting Oct. 8.

The bailout fund will take its place alongside plans announced by the European Central Bank last week to buy unlimited amounts of short-term government bonds issued by troubled countries — if those nations apply for help from the ESM. The ECB plan has been criticized by some in Germany, but Chancellor Angela Merkel has signaled her backing (which is odd considering she used to be the austerity champion).

Merkel made clear Thursday that, despite the past week’s boost to the 17-nation eurozone’s rescue efforts, neither program alters the need for struggling countries to cut their deficits and enact economic and labor market reforms.

“If we want things to get better, then we can’t send the wrong signals and act as though lasting and sustainable progress were possible without such reforms,” she said in a speech to a trade group.

German Chancellor Angela Merkel (AP Photo/Markus Schreiber)

“The homework must be done at home, in the countries,” she said. “The ECB [European Central Bank] cannot replace political action.”

She insisted that aid will continue to come with strings attached. “We show solidarity, of course, but there is support only when things are done to overcome the problems.”

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The Associated Press contributed to this report. All photos courtesy the AP.

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Comments (53)

Apple Bite
Posted on September 15, 2012 at 12:12am
You guys are looking at this situastion totally wrong. Merkel is trying to make these idots responsible for their own finanical woes, meanwhile, those same idiots continue to look for ways to spend money that, they not only don’t have, but spend neighboring countries money too. Because of this, the EU is not only a total failure, it’s a house of cards stacked upon a house of cards.

Truth be told, I feel sorry for Merkel in this situation. She’s one of the few voices of reasoning that continues to be ignored by the jackholes in control of the EU. In the end, the German people will have to rise up and take by control of their country’s government. I wish them the best of luck in doing so.

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- sgtstubbs
  Posted on September 16, 2012 at 4:41pm
  Uncle Adolf will make it better. Just as it has occurred before in Germany
  
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cosmic dogma
Posted on September 14, 2012 at 10:45pm
Really BAD IDEA.

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65Plus
Posted on September 14, 2012 at 9:29pm
What the h**l! It’s only paper. Germany has had a lot of experience with paper.

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ALL4FREEDOM
Posted on September 14, 2012 at 8:59pm
They’re doomed. And so are we, thanks to “Bungling Ben” Bernanke. Thanks for the credit downgrade, Ben! Can you say, “Wiemar Republic?”

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- 65Plus
  Posted on September 14, 2012 at 9:31pm
  Am not convinced that Bernake is …”bungling.” It would appear that what he is doing is quite deliberate with a clear, unmistakable, and engineered outcome.
  
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- PeacefulUnderFire
  Posted on September 15, 2012 at 7:50am
  There is SO little transparency and/or accountability in our big gvt approach to things I wouldn’t be at all surprised to discover an odd combination of these two scenarios based on just the influence of the KNOWN players.
  
  Report this comment
chicago76
Posted on September 14, 2012 at 3:53pm
So the EU has convinced the Germans to print lots of money against their better judgment. Well who would have thought. They will all go down together. The Islamo fascists are watching all this with great interest. They see the cowardice, godlessness, and bankruptcy of the European governments and peoples and they are preparing. The also see that Europeans are dying. They are preparing. The Europeans will be fighting the Islamo-fascists in their own back yards and on their own streets. Why build nuclear weapons when you can just take them from the Europeans.

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Mike Austin
Posted on September 14, 2012 at 3:31pm
She insisted that aid will continue to come with strings attached. “We show solidarity, of course, but there is support only when things are done to overcome the problems.”

No wonder the picture looks like she is sleeping. Because she is dreaming if she thinks that will matter. Goodbye EU.

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focusonquality
Posted on September 14, 2012 at 12:29pm
This time let them have France and defend Poland

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- 65Plus
  Posted on September 14, 2012 at 9:31pm
  Agreed. No more D-Day to save France from the French.
  
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The Third Archon
Posted on September 14, 2012 at 10:53am
Damn–Germany is going to end up through economics with what they could not acquire and hold through war. How ironic, lol.

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- Walkabout
  Posted on September 14, 2012 at 11:21am
  Sure they are. They are going to conquer Europe this way just as surely as your IQ is above 100.
  
  Greece or other countries default or renegotiate the terms & some debt is forgiven.
  
  Which means that the German taxpayer is on the hook for that money. I know families in two Northern European countries. One family is middle class & college educated in white collar jobs. $ people living in 2 bedrooms. Another family is in a 2 bedroom apartment with 5 people.
  
  Now those people are suppose to pay more for the socialist (sociosh/t) spending of Greece or other countries.
  
  Really? Go to Europe stand on a street corner & engage people with that drivel.
  
  Before you do that I would like to take out a large insurance policy out on you 1st.
  
  Report this comment
- Rothbardian_in_the_Cleve
  Posted on September 14, 2012 at 12:26pm
  Banks are better than tanks when it comes to subrogation. Blitzkrieg!
  
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Gonzo
Posted on September 14, 2012 at 9:45am
You know America is in trouble when a $250 billion starts sounding like chump change to it’s citizens.

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- Walkabout
  Posted on September 14, 2012 at 11:48am
  I hope France is on the hook for that bailout. The F___ing Socialist French President is pushing this bailout France has 63 million people to Germany’s 81 million. The French had better be on the hook for almost a quarter.
  
  Unless there is so much war that people forget, the F___ing socialist will not be President of France for more than 2 terms.
  
  Report this comment
Frank_Wall
Posted on September 14, 2012 at 9:20am
I guess this is the last throw of the dice from Europe. If this fails, Germany will on its knees along with everyone else. Frightening and risky. They’ve already contributed more than anyone else to the European Stability Mechanism according to statistics: http://www.statista.com/statistics/201810/european-stability-mechanism-contribution-of-eu-countries/

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- Dismayed Veteran
  Posted on September 14, 2012 at 10:41am
  A Germany on it’s knees is a dangerous thing. They have proved twice in the last century that they are willing to wage war in Europe.
  
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00gabooga
Posted on September 14, 2012 at 9:17am
I hope she enjoys her last term in office!

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- Walkabout
  Posted on September 14, 2012 at 11:13am
  60 or 70 million people got stuck for am additional bill for $ 150 billion plus. They have to support Muslim occupiers & other welfare cases.
  
  Merkel was told she had to do this or it would be the Great Depression on steroids. Yes it probably is her last terms.
  
  She should have told the stupid dumba$$ socialist President of France to stick it where the sun don’t shine. He already put as down payment on the ruination of his country.
  
  Report this comment
- SolitudeBliss
  Posted on September 14, 2012 at 12:20pm
  I have great admiration for Angela Merkel, she is the german Iron Lady holding Europe together like Crazy Glue right now as it wants to come completely apart at the seams. Women like her and Margaret Thatcher are far and few between.
  
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- Rothbardian_in_the_Cleve
  Posted on September 14, 2012 at 1:37pm
  Merkel lies to her people and sells out German sovereignty for a collectivist pipe dream. Iron Lady? Not even close.
  
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- Walkabout
  Posted on September 14, 2012 at 5:06pm
  Merkel is bailing out Greece & other socialist countries.
  
  There was a local governor in the Azores who was told by the Portuguese government to live within his budget & make some cuts. That f___er blew his budget spent more than ever & just smiled at them. It is people like that, who have cause this mess.
  
  Portugal Says It Will Bail Out Azores Region
  http://online.wsj.com/article/SB10000872396390443855804577601140955504590.html
  
  Report this comment
- Walkabout
  Posted on September 14, 2012 at 5:15pm
  Merkel is bailing out the crap crated by socialist governments in Greece.
  
  Hitler had no intention of invading Greece or Yugoslavia. It set back his invasion of the Soviet Union.
  
  Yugoslavia had a government that was friendly to Germany. The King was a Germanphile. The British spread some money around & overthrew the government, which was anti-German, whereupon Germany promptly invaded.
  
  Greece was run by a dictator Metaxas. Mussolini saw Hitler invade Poland, Czechoslovakia, France, Denmark & Norway. He diced that he needed some territory so he invade Greece form Albania. He got his azz handed to him. So Hitler bailed him out. Hitler had no designs on Greece. Read his book. A neutral Greece served as a great buffer for the soft under belly of Europe. Think about it.
  
  Merkel is not trying to conquer Greece Financial. Greece is a basket case because of politicians like Papandreou dynasty & the people who vote for them to receive bread & circuses.
  
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sbenard
Posted on September 14, 2012 at 9:07am
Merkel will go down in history as Weimar II! She will destroy her country’s solvency and economy with this move! She’s just kicking the can, and that can contains a ticking time bomb of debt!

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- chicago76
  Posted on September 14, 2012 at 3:55pm
  Merkel caved in to the banks. She will be remembered as the destroyer of Germany.
  
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blanco5
Posted on September 14, 2012 at 7:56am
Why does Germany cut their nose off to spite their face?

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ipockpa
Posted on September 14, 2012 at 7:15am
What happens when this money is not repaid and the Germans are stuck with the bill? Are we going to see German armies begin to cross borders to collect what is rightfully theirs?

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- anthonyebaker
  Posted on September 14, 2012 at 8:35am
  Probably
  
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- chicago76
  Posted on September 14, 2012 at 3:57pm
  The rest of Europe will either bow to German or they will kneel before the Caliph. It is coming.
  
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watersRpeople
Posted on September 14, 2012 at 7:06am
You can always when it comes down to the wire, count on women to sell your nation out from under you – just look at the U.S, the male daughters and the female daughters sold the U.S a long time ago.

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- AnOregonian
  Posted on September 14, 2012 at 9:07am
  @Water (on the brain) I see to you have it all figured out, I’m sure you make your mamma proud.
  
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watersRpeople
Posted on September 14, 2012 at 7:04am
It looks like Germany needs a real leader, and one who will make your males into men again.

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- Magyar
  Posted on September 14, 2012 at 6:31pm
  I’d be curious to hear what the average German on the strasse has to say about the thieft of their hard earned tax ‘Euros’….
  
  Ovomit and Merkel ki-s-s- ing up a tree!
  
  Report this comment
MeMadMax
Posted on September 14, 2012 at 6:54am
The left cornered merkel after the French elections lol…
These next 2 years should be a real hoot to watch…

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Delores at CH WV
Posted on September 14, 2012 at 6:05am
No, 3 panel judges in Germany made this decision, the new Iron Lady had said NO, NO, NO. It goes to show you and should show the EU citizens that their election officals are not Heads of their government; but, patsys. It is very clear to the awaken, that shadow government has taken over the Earth and is bringing the citizens along kicking and screaming.

So, is it the Great United Nations running the show? If so, We the People need to ask God to relieve us of this slimy government setting in NYC and send all of them packing back to their caves of evil. It is all about money, CUT the cash, please! Who is that man or woman brave enough to make the difference?

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Chrischan74
Posted on September 14, 2012 at 5:31am
I can still remember, how the German public cheered when Gauck took office.
Now I think, the cheers get stuck in the mouth of the public, because now it is clear, that Gauck is just another traitor, who can’t wait to give away the German taxpayers money to the Bruxells central-comitee apparatschicks, so they can go on to form the EUdSSR.
The bad thing is, that the whole european public is of the opinion, that they are able to change anything through votes or similar crap. There is just one way to change anything and this is an armed revolution, where in the end all officials (EU-Officials and the officials of the single european states) are publically executed and then we would be abel to start over.
But this will never happen, because europe has the most strict gun-control laws worldwide, and this is by intention.
What do Lenin, Hitler and Mao have in common? After they took office, they unarmed the public, because they feared an uprising.
So it is not just Lenin, Hitler and Mao. You can easily put any government in Europe in this litany.

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- ipockpa
  Posted on September 14, 2012 at 7:12am
  Sad as it is too many times a complete removal of governmant officials, even through violence, is called for.
  
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OperationNorthwoods
Posted on September 14, 2012 at 3:54am
I bet ya they blow through that in about 6 months.

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Micmac
Posted on September 14, 2012 at 3:09am
They just dug their hole deeper. Countries like Greece will not get in line and behave until there is a total collapse of their country. They now say they want to be able to put technocrats into each souvreign country. Haven’t looked closely at it lately but the technocratic (socialists basically) takeover is part of the long term plan that was laid out when the Euro was created to create an all encompassing EU. There will be strings. On a side note, I am sure the German populus is livid about this move. All it will do is postpone the eventual collapse of the EU. Now that they have decided that they can print their own fiat money, major inflation will become norm. I had my relatives their pull their money out of the Euro.

NoBama > MoBama.

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diverdan
Posted on September 14, 2012 at 2:51am
Sounds like the Fed and European Central Banks are working together to create hyper inflation. Nothing like a worldwide economic collapse to hasten in the one world order.

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Citizen-1
Posted on September 14, 2012 at 2:10am
She caved. That’s it. She kicked the can instead of looking after her people….

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- Snowleopard {gallery of cat folks}
  Posted on September 14, 2012 at 2:21am
  More than just caved in under the pressure; the German people have history to learn from and they still do not want to see what is happening. Now I wonder, as the Euro and EU collapse and are torn asunder, how many nations will fall into the madness, and how long until war breaks out.
  
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- Micmac
  Posted on September 14, 2012 at 3:12am
  She did. But she also lost her hold card, which was the strength of Germany and the leverage therewith.The technocrats win, the citizens lose.
  
  NoBama > MoBama
  
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- nzkiwi
  Posted on September 14, 2012 at 3:22am
  You guys are right. I was going to make a comment about German economic history until you beat me to it, Snow. Their economic woes after the war are well within their collective living memory.
  
  I think that their determination to maintain the idea of a “United States of Europe”, including a single currency, in spite of clear indications of its imminent demise, shows a dangerous, ideologically-driven myopia.
  
  As the Blaze previously reported, Iceland has clearly shown them the way, but that reality doesn’t conform to their socialist utopian dream.
  
  Therefore, obviously, reality must be ignored.
  
  Report this comment
- asybot12
  Posted on September 14, 2012 at 5:30am
  Could not agree more with all of you . The serious problem I have is that all of this is being done by unelected faceless behind the scenes bureaucrats, until he retired a few years ago my brother was one of them, we stopped talking years ago now that he has had some time to look at what is going on in the real world he is coming around, sadly he was one of the ” builders” that had nothing but sunshine in his eyes. The big thing that he now admits is that there were absolutely no checks and balances in the early days of this whole process, which he admits has been going on for decades he had a “mentor” when he first was hired 35 years ago and followed this guys directions. We all know the feeling, got a job and got to keep it especially bureaucrats (gravy train you should see his pension!!!).
  
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- nzkiwi
  Posted on September 14, 2012 at 5:46am
  Which area did he work in, Asybot, if my question is not too personal?
  
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Action-Not-Just_Words
Posted on September 14, 2012 at 1:21am
The Euro foundation crumbles… Death rattle to follow…

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- ZAP
  Posted on September 14, 2012 at 2:52am
  MERISSA PEYTON now WORKS the STREETS
  
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- Stoic one
  Posted on September 14, 2012 at 5:48am
  and here i thoughtshe was working on a bed…………
  
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ltdan
Posted on September 14, 2012 at 1:14am
All the dominos are set, and even our FEDS have opted in. Now we wait for the first one to tumble.
Americans wake up and become self reliant and prepare for the worst.

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- steveh931
  Posted on September 14, 2012 at 12:23pm
  And don’t procrastinate.
  
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