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Don't Act Beyond Your Powers: The Perils and Pitfalls of the German Constitutional Court's Ultra Vires Review

Published online by Cambridge University Press:  06 March 2019

Jürgen Bast

Extract

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On 26 July 2012, the European Central Bank (ECB) issued a new currency, the “Draghi.” A country where the Draghi has the status of legal tender must be fabulously wealthy—a single coin gives unlimited purchasing power to its owner. This is one way to characterize ECB President Mario Draghi's pledge to do “whatever it takes” to save the Euro. It is widely believed that the move prevented the common currency from breaking apart. Yet, the ECB's resolve caused severe conflict within the European System of Central Banks (ESCB). A few weeks later, when the Governing Council of the ECB formally adopted the Outright Monetary Transactions (OMT) program to pave the way for the implementation of Draghi's rescue policy, the representative of the German Bundesbank was outvoted. Subsequently—in a maneuver quite unusual among central bankers—he appealed to the public to stir up support for his opposition to the policy.

Type
Research Article
Information
German Law Journal , Volume 15 , Issue 2: Special issue - The OMT Decision of the German Federal Constitutional Court , 01 March 2014 , pp. 167 - 181
Copyright
Copyright © 2014 by German Law Journal GbR 

References

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52 OMT Case at paras. 13–15, 71.Google Scholar

53 OMT Case at para. 7.Google Scholar

54 OMT Case at paras. 95–98.Google Scholar

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56 OMT Case at para. 98.Google Scholar

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62 Honeywell at 301–03.Google Scholar

63 OMT Case at paras. 39, 43.Google Scholar

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66 OMT Case at para. 100.Google Scholar

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71 See Schütze, Robert, From Dual to Cooperative Federalism 349 (2009).Google Scholar

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73 Famously called “Kompetenz-Kompetenz.“ See OMT Case at para. 48.Google Scholar