It is ridiculous to see how the EU is reacting to the German constitutional court ruling. After all, the judges only found that the ECB never provided the documentation that served to demonstrate that its work respected its own statute. If the ECB were subject to the laws governing any bank, it would be a crime, because it would have hidden social communications from its members.
Moreover, to close the matter it would be enough for the ECB to provide the judges with what they ask for: the economic and financial assessments that demonstrate that its work has never financed any nation, and the papers of the meetings where the decisions were made. In themselves, these are social documents that each bank provides to the members of the Board of Directors, so it is not clear where the problem would be.
But to understand the problem one must ask oneself: how come the ECB has hidden these data, or has secreted them, to the point that not even the Bundesbank, its largest partner, can supply them to the constitutional court? I mean, in Germany ANY government agency MUST obey the Constitutional Court. If the German government had evidence that the ECB rated the economic and financial impacts of the QE program null and void, an order to provide those documents would suffice for the court. Same thing, if the Bundesbank, which is a member of the ECB, had had a copy of that documentation, the Constitutional Court of Karlsruhe would have been sufficient to order the Bundesbank to deliver them.
Instead, the court instructed the German government to have the documentation delivered by the ECB, a sign that not even the German government has these assessments, and asked the ECB to deliver them, under penalty of the Bundesbank being blocked. What does it mean?
It means that the ECB has hidden its assessments of the economic and financial impact of the measures it has taken from its German partner and Germany. If the ECB were a normal bank, Draghi would already be in prison. And for some time.
This is the point. Because there are two cases:
- The documents where it is assessed whether the shares are compatible with the articles of association exist but have never been disclosed to the German shareholder. Under these conditions, in a normal bank Draghi would have ended up in court.
- The documents where it is assessed whether the shares are compatible with the articles of association DO NOT exist, this evaluation has not been made, and in this case it would be a catastrophic lack of due diligence . In a normal bank, the shareholders ask for the revocation of the CDA and reserve legal actions.
Either way, Draghi's name is destroyed. Because of its statute, the ECB cannot be tried and Draghi will never end up on the defendants' bench, but his name (in a world where reputation is everything) can end up on the grill.
The Germans never managed to kill him while he was the leader, and they will massacre him now that he is no longer. Why, I repeat: to get out of the way, if case "1" were true, for the ECB it would be enough to give the judges documentation and say "many apologies if we haven't given it before, here are the documents you are looking for".
But if there is all this embarrassment, I consider an embarrassing case "2" much more likely. In this case, we have a bank that manages the share capital WITHOUT taking care to respect its own statute, nor did it take care to understand IF its work respected it.
The excuses with which the European institutions are defending themselves are pathetic.
- The Constitutional Court is competent in Germany, and is competent to answer for German savings as much as in Italy. When there is an article in the constitution which says that the state defends savings (as also exists in the Italian constitution) then the constitutional court can be invested with the request to clarify whether this decision defends savings.
- It is said that the Constitutional Court must submit to European law. But this is not true in Germany, where by definition the Court is completely autonomous from any state institution, including the German ones. Moreover, the court has not abolished any treaty, therefore it has not replaced any European body. He only asked for DUE documentation to decide whether the ECB's conduct is consistent with the statute, and he threatened to do something in his power to do, that is, give orders to the Bundesbank. There is no rebellion against European law, given that the ruling of the European Court of Justice did NOT contain the documentation in question.
- The threat of subjecting Germany to an infringement procedure for a ruling by its constitutional court makes no sense, given that the German government has no means of influencing the court itself, which is completely independent of it.
The truth is that "whatever it takes" Draghi was caught with his hands in the jam. In all likelihood the decisions he made were illegitimate and ill-formed, and the Germans, as well as the EU, know well that the required documentation will never arrive.
The stakes are Draghi's head. That at this moment is no longer available as leader of NOTHING, because sooner or later someone will have to admit that the assessments were never made by Draghi, and that the decisions "were taken unanimously" (cit. Mario Draghi) had been taken with an empty chair, that of Germany. Even more serious.
This diatribe is destined to last a long time, because sooner or later someone will start saying to Lagarde "well, in short, she is giving him documentation and plug his mouth", and sooner or later some journalist will ask the Frenchwoman who is waiting to give all studies that, due to due diligence, must have been done before Draghi's decisions.
And when it becomes clear that they don't exist, Draghi's name will have the same value as the toilet paper used.