Eurozone crisis: New EU treaty ’may not be needed’
2011 12 07

From: bbc.co.uk

Success boys. More control achieved!

Tougher rules to tackle the eurozone debt crisis can be achieved without changing EU treaties, European Council President Herman Van Rompuy says.

In a leaked report for a crucial EU summit beginning on Thursday, he offers a fast-track "fiscal compact" that does not need lengthy ratification by parliaments or national referendums.

Germany and France are pushing for a new EU treaty by March, saying stricter rules should be enshrined there.

The US has backed their plans.

But Treasury Secretary Timothy Geithner said the US Federal Reserve had no plans to give money to the International Monetary Fund to boost the eurozone's bailout fund.

Mr Geithner, who is meeting all major eurozone leaders during his three-day visit of Europe, stressed that more action was needed to boost economic growth in Europe, alongside the longer-term reforms. He meets President Nicolas Sarkozy in Paris on Wednesday.

Five crucial days for the euro

  • Monday: Nicolas Sarkozy and Angela Merkel propose tighter eurozone controls


  • Italian PM Mario Monti seeks parliamentary approval for his austerity package


  • Tuesday: US Treasury Secretary Timothy Geithner arrives in Germany before travelling to France and Italy for talks with euro leaders


  • Wednesday: The talking continues as many EU leaders gather in Marseille for a European People's Party congress


  • Thursday: ECB's monthly policy meeting could produce new measures


  • Thursday and Friday: Crucial EU summit in Brussels to consider Sarkozy-Merkel plan


’Negative implications’

Mr Van Rompuy will be chairing the two-day summit, and all the signs are that it could be a bruising affair, the BBC's European affairs correspondent Chris Morris reports.

In the interim report, details of which have been obtained by the media, Mr Van Rompuy proposes a plan aimed at agreeing a "new fiscal compact" without holding a referendum or ratification by the parliaments of each eurozone country.

The draft says that tougher fiscal reforms can be adopted simply by amending a protocol - a procedure that needs national consensus but does not require substantial changes to the EU treaties.

This, Mr Van Rompuy argues, would speed up the implementation of reforms and remove any potential political complications.

The interim report contains the following key provisions:

  • Each eurozone member's budget deficit should be below 3% of GDP and national debt under 60%


  • A "golden rule" should be enshrined into national legislation to guarantee a balanced budget in the medium-term


  • The eurozone bailout fund to be given a banking licence to borrow directly from the European Central Bank


  • The European Commission to have the power to impose austerity measures automatically on countries which require bailouts


However, Mr Van Rompuy acknowledges that more far-reaching reforms would eventually require a change in EU treaties.

Some of the report's proposals tally with the Franco-German plan how to tackle the crisis, but some do not.

Paris and Berlin appear to be pushing through more radical measures, our correspondent says, and if all 27 EU members cannot agree, then they are prepared to work towards a new treaty involving the eurozone bloc and any other country that wants to join.

Such a move could leave Britain - a non-eurozone EU member - feeling more isolated, he says.

UK Prime Minister David Cameron has said he will not sign a new treaty without safeguards for to protect financial interests of the City of London and Britain's role in the European single market.

But such is the depth of the crisis surrounding the eurozone that the main focus is not on the EU solidarity but on restoring market confidence in whatever way proves possible, our correspondent says.

Earlier this week, Standard & Poor's put all eurozone nations on credit watch "with negative implications".

The ratings agency said the decision was prompted "by our belief that systemic stresses in the eurozone have risen in recent weeks to the extent that they now put downward pressure on the credit standing of the eurozone as a whole".



Related Articles


Latest News from our Front Page

Starbucks Supports Pro-GMO Company
2014 11 26
Another reason why you should not go to Starbucks. Starbucks has an image of being a socially responsible, environmentally friendly company (Really?). In 2013, 95 percent of their coffee was ethically sourced, and their goal is to reach 100 percent by 2015.1 Other goals include reducing water consumption by 25 percent in their company-operated stores by 20152 and mobilizing their employees and ...
Group Polarization and the Fad of Ethno-masochism
2014 11 26
From "Group polarization: A critical review and meta-analysis". Journal of Personality and Social Psychology. 6 50 (6): 1141--1151 The psychology of White self hatred. Political correctness IS a mental disorder. More: Group polarization: A critical review and meta-analysis. Isenberg, Daniel J. the paper Indoctrinate U Harvard Professor Noel Ignatiev talks about how to end the White race The History of Political Correctness The Narrative: The origins of Political ...
Credo: A Nietzschean Testament by Jonathan Bowden
2014 11 26
This lecture by Jonathan Bowden was given at the 11th New Right meeting in London on September 8, 2007. The original title of the presentation was “The Art and Philosophy of Jonathan Bowden.” I think ideas are inborn, and you’re attracted, if you have any, toward certain systems of thinking and sensibility and response. From a very young age, I was ...
A Look Back at the OJ Simpson Verdict -- Reactions
2014 11 26
This is a look back at the different reactions to the OJ Simpson verdict some 20 years ago (exact date of verdict was Oct 3, 1995). The OJ Simpson jury consisted of 9 Blacks, 1 Hispanic, and 2 Whites. It would raise eyebrows after they only deliberated for 4 hours in a case that they were involved in for almost ...
New York Times Publishes Darren Wilson’s Street Address and Photo of House #Ferguson
2014 11 26
Hey here are the two @nytimes scumbags that published Wilson’s home address. —> @juliebosman & @campbellnyt— Ben Howe (@BenHowe) November 25, 2014 Michael Brown’s Stepdad Shouting ‘Burn This Bitch Down’ The New York Times published information about the address of Ferguson Police Officer Darren Wilson on Monday in a move that has generated controversy. Tensions are running high in Ferguson, Missouri, as ...
More News »