The European Stability Fund (ESM) was due to take effect in July and proposed as a backstop to protect the debt crisis from spreading by providing loans to troubled euro zone members. It was designed to replace the European Financial Stability Facility (EFSF), which was a established as an emergency fund in May 2010. Euro zone countries (including those in dire financial shape like Italy and Spain) pledged 440 billion euros in loan guarantees, which the E.F.S.F. used to supply 192 billion euros in bailouts for Ireland, Portugal and Greece. The EFSF now has little of the initial funds left to deploy.
The (ESM) was designed as a longer term fund and was drafted as impenetrable to judicial scrutiny and normal legal and democratic process. It is a very dangerous structure and precedent that seeks to literally enslave the citizens of Europe to endless servitude in order to fund and maintain the financial complex with “unlimited” funds.
The wrinkle in all of this is the German constitutional court ruling today that the German government is free to back the ESM fund but with limits on that participation. The court said that the government has to get approval of the German parliament if Germany’s exposure to the ESM exceeds 190 billion euros. The government also has to keep both houses of parliament informed about the bailout fund, stating that the Bundestag “must individually approve every large-scale federal aid measure on the international or European Union level.” These two provisions appear prima facie in opposition to the iron clad provisions drafted in the ESM constitution itself as explained in this video.
Thinking people have to care about how the ESM as proposed is designed to thwart and negate basic tenants of fairness, disclosure, democracy and the rule of law. This is a shockingly oppressive regime. Time to wake up. Read more here: Draghi reinvents the divine right of kings.