Sovereignty and Sovereign Debt

Josef Joffe, editor of Die Zeit, is upset with Germany’s high court.  It seems that this court has ruled, again, against the European Central Bank’s President, Mario Draghi, and the ECB itself in continuing to note that ECB moves to buy member nations’ sovereign debt not only is a violation of EU foundational law, it violates the sovereignty of those nations expected to put up their peoples’ money to buy that debt.  Germany’s highest court also committed the dastardly deed of kicking the latest matter to the European Court of Justice.  All in the name of protecting German national sovereignty.

So the docket of the German high court in Karlsruhe never clears, and the battle cry never stops: “It’s our sovereignty, stupid!”


The German plaintiffs’ key complaint against the ECB comes in Latin—ultra vires. They argue that it would go “beyond the power” of the ECB to buy sovereign debt.

The horror.  The horror.

While cynically ridiculing the idea of national sovereignty throughout his article, though, Joffe missed another point, perhaps caused by his evident lack of understanding of the nature and importance of national sovereignty.

The larger story proclaims: Europe is still far from the United States, a real union.  The EU has neither a real Federal Reserve, nor a common fiscal policy, nor commonly elected leaders to define the common good.  The logic of a “more perfect union” demands these commonalities, but it collides with the logic of nation-states rooted in 2,000 years of history.

Leaving aside the EU’s demonstrated contempt for the common man (recall its formation: some countries rejected the union in national referenda, so the governments involved told those impudent populations to shove it and signed the Maastricht Treaty, which dragged those populations into the EU against their will), Joffe’s remark misses the fact that the EU also has no common culture, nor does it even have a common view of the purpose of money.

Even in the EU—especially in the EU—national sovereignty matters.  A very great deal.

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