German Defence Minister: EU should respond to crises as bloc

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Germany’s Defence Minister, Ursula von der Leyen, has said that the EU should move to a system of majority vote for foreign policy decisions, a clear push to stop any government from blocking deeper EU military integration. Continue reading

‘The best that could happen to Greece’

Consisting of representatives of the International Monetary Found (IMF), the European Central Bank (ECB) and the European Commission, the Troika “was supposed to become an auxiliary government and audit court with permanent rights of intervention”. But, Martens writes, the name “Troika” and possibly even the composition of the control group will be changed. Even European Commission President Jean-Claude Juncker is said to be in favor, as the EU did not like the IMF’s involvement in its affairs, and the ECB “was never convinced of its own role” in the Troika.

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France rebels against austerity as Europe’s recovery collapses

France’s finance minister sends tremors through European capitals with a defiant warning that his country would no longer try to meet deficit targets

Eurozone strategy is in tatters after economic recovery ground to a halt across the region and France demanded a radical shift in policy, warning that austerity overkill is driving Europe into a depression.

Growth slumped to zero in the second quarter, with Germany contracting by 0.2pc and France once again stuck at zero. Italy is already in a triple-dip recession.

Yields on 10-year German Bunds fell below 1pc for the first time in history, beneath levels seen during the most extreme episodes of deflation in the 19th century. French yields also touch record lows. Much of the eurozone is replicating the pattern seen in Japan as it slid into a deflation trap in the late 1990s.

It is unclear whether tumbling yields are primarily a warning signal of stagnation ahead or a bet by investors that the European Central Bank will soon be forced to launch quantitative easing, buying government bonds across the board.

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German Domination: An Accidental Empire?

“Germany has created an accidental empire,” German sociologist Ulrich Beck said on March 25. In an interview with EUROPP editors Stuart Brown and Chris Gilson, the professor at both Munich University and the London School of Economics invoked the memory of the last “accidental empire,” Great Britain. But he stopped short of calling Germany a military power—which Britain was. Germany’s de facto empire has an economic power base, not a military one, he proposed.

In the turbulence of the ongoing European financial crisis, one nation has emerged from the storm as the clear leader of the Continent. For the third time in a century, Germany has set itself apart as the top dog in European economics and politics. The Berlin-led bailout of Cyprus proved that point in a tangible way.

That’s just the way it happened to turn out, some may argue. But is this true? Continue reading