Germany demands - The noose is tightening

GERMAN Chancellor Angela Merkel is proving, as if needed to be proven, that there is no such thing as a free lunch but let us all fervently hope that the bill will not include another referendum on the Lisbon Treaty.

Speaking in Brussels yesterday Taoiseach Brian Cowen argued that a referendum would not be necessary unless there was a significant transfer of powers involved in establishing a permanent EU rescue fund. Again, let us hope he is right.

German support for bailouts of tottering eurozone economies was never likely to be open-ended and was certain to come with some sort of a price. The German government faces considerable domestic unease on the matter so concessions were unavoidable.

Ms Merkel has expressed concerns that the May bailouts may be judged unconstitutional by German courts. Such a prognosis prompted Bundesbank president Axel Weber to oppose the ECB’s decision to buy the bonds of weaker states. Weber is Germany’s nominee to become the ECB’s new president next year and he has made clear he will not accept the position unless all eurozone states agree stiff, German-style “stability-first” principles. Every single day the noose tightens and every day the consequences of our great folly and greed become more and more apparent.