Some German MPs call for debt conversion mechanism and not the ESM. Looks the best solution to me.

German firms urge rejection of stability mechanism

DEREK SCALLY in Berlin

EUROPE’S PERMANENT bailout fund is a legal and financial “black box”
that should be rejected by German MPs, according to an association
representing the country’s family-owned companies.

A protest letter signed by 350 of Germany’s best-known companies such
as Kärcher, Henkel and Würth attacks the bailout fund and disputes
what it calls the “myth that Europe can only survive as a transfer
union”.

The companies take issue with “political whitewash” over the euro,
which it sees as a “driving force for dispute, jealousy and hate” in
today’s Europe.

“The coercion and consequences of a common currency are beginning to
divide European peoples permanently,” said the statement. “Not every
means is permitted to save the euro – and those who want to save the
euro at any price risk the price being Europe.” With its statement the
association joins a growing wave of protest against the European
Stability Mechanism in Germany.

Agreed by EU leaders last July, the ESM is scheduled to begin working
next month as a permanent bailout fund with a total financial capacity
of €700 billion.

After months of stand-off with the political opposition, German
chancellor Angela Merkel’s government is on course to vote on the ESM
and the fiscal treaty before the summer break – possibly as early as
next week.

Her insistence on linking the two votes created a ratification delay
and political uncertainty in Berlin: the fiscal treaty enjoys
cross-party support while the ESM is far less popular, particularly
among backbenchers.

Dr Merkel says the two pieces of legislation are interdependent and
must be voted on together. Analysts suggest a strategy to limit revolt
in her own ranks.

At least 10 government MPs are planning to vote against the ESM. They
are calling for a “debt-conversion mechanism”, allowing crisis
countries to receive funds and retain budget sovereignty while
participating in an International Monetary Fund-chaired arbitration
procedure with creditors to decide on debt write-downs.

Anti-ESM demonstrations have been held in Munich and, yesterday,
before the Reichstag in Berlin. The protest was organised by the Civil
Coalition, which has an anti-ESM video on YouTube.

“Our video has been translated into 14 languages and viewed one
million times around Europe. Over one million protest emails have
reached our politicians,” said Beatrix von Storch, head of the Civil
Coalition. “Nothing like this has ever happened before.” Opponents of
the ESM have vowed to challenge the fund at Germany’s constitutional
court in Karlsruhe.
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