European Monetary Union Misnamed; I Propose GEU (German Economic Union) or USG (United States of Germany)

EuropeanMonetaryUnionMisnamed; I ProposeGEU (GermanEconomicUnion) orUSG (UnitedStatesofGermany)

The irony and hypocrisy in chancellor Angela Merkel’s first parliamentary speech of her third term would be astounding were it not par for the "Everything for Germany" course of action.

Please consider Chancellor Urges Reformsto Preserve Euro

In her first parliamentary speech since her re-election for a third term on Tuesday, she warned that Europe needed to take further action to make the euro zone crisis-proof.

More European Control

"I know that pushing through treaty changes in the member states can be difficult, but if you want more Europe, you have to be prepared to develop it further," Merkel said. "In a world that is constantly changing, we can’t stand there and say that at some point we agreed the Lisbon Treaty and there’s no need to change it again. This won’t work."

Germany wants closer economic policy coordination and will push at a summit of European Union leaders on Thursday and Friday for members to agree binding contracts with the European Commission to implement further reforms.

It is also pushing for changes to the Lisbon Treaty to give greater European control over policy. Germany’s closest ally in Europe, France, opposes such a move, as do other member states.

"European unity remains one of the most important tasks of the grand coalition," said Merkel. "Germany is only strong if Europe is strong."

Criticism of EU Green Energy Probe

She said she would fight an EU probe announced on Wednesday into exemptions from a green energy surcharge for some 2,000 German companies. The European Commission is examining whether the exemptions, totalling some €5 billion and granted to heavy energy users like the steel industry, were unfair and should be repaid.

The German government would not tolerate a weakening of German industry or job losses, she said. "Germany wants to remain a strong industrial location, we need competitive companies," she said. "This is about companies and when it’s about companies, it’s about jobs."

She said Germany’s new Economy and Energy Minister, Social Democrat Sigmar Gabriel, would make this very clear to the European Commission.

Merkel the Hypocrite

Allegedly Merkel wants more EU controls. She is even at odds with France over controls. But let the EU propose energy controls and all of a sudden she does not want them.

Recall that Germany backtracked on the banking union. Heck, Germany fought bitterly to have some of its banks specifically excluded from banking union provisions, and won.

Now Germany wants more integration. Except of course when it doesn’t, like a true banking union deal a week ago, and energy controls today.

I am certainly not defending EU energy policy. But I am critical of the inherent hypocrisy in Merkel’s plea for more EU controls when she does not want more EU control, but rather more German control.

Since this is par for the course, (and it will remain that way), let’s put an appropriate label on it.

Do You Prefer

GEU – German Economic UnionUSG – United States of Germany
Is it number 1 or number 2?

he question is moot actually, except for the short-term. Long-term, the European Monetary Union is doomed.

I made the case for a disorderly breakup in Laughable Eurozone Banking "Non-Union".

Merkel’s first parliamentary speech of her third term adds credence to the disorderly breakup thesis.

Mike "Mish" Shedlock

Mike "Mish" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction. Visit to learn more about wealth management and capital preservation strategies of Sitka Pacific.

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