Germany Accuses Italy of "Debt Blackmail": Hello EU, Time for Reform Expired

For 10 years, the EU and EMU promised reform. None was delivered. Time is Up. Populists have taken control of Italy.

Merkel's CDU/CSU coalition is in a state of panic regarding Italy. The German parties went on the attack accusing Italy of "debt blackmail"

Eurointelligence Snips

This was the day when people who were left speechless by the political events in Italy started to talk. In Germany it was the now cancelled request for a monetary financing of Italy's debt that triggered a collective nervous breakdown.

The CDU's economic council warned about a eurozone endgame, and said that Angela Merkel's policy of kicking the can down the road had led to a situation where the debtors are now in a position toblackmail the creditors. Its general secretary was quoted by FAZ as saying: why should German households pay for rich Italians? The head of the CSU in the Bundestag, Alexander Dobrindt, also demanded that under no circumstances Germany should pay for Italy's debt programme. His colleague in the European Parliament, Manfred Weber, says Italy was playing with fire, and was risking another eurozone crisis.

Eurozone Reform Officially Dead

French President Emanuel Macron has a vision for Europe. Germany did not agree with it.

Heck, Germany did not agree with any Eurozone reforms for over a decade. Chancellor Angela Merkel blew with the wind in a perpetual can-kicking exercise, accomplishing nothing.

Now, it's too late. The new Italian government will kill any proposal that Germany and France may agree on.

And of course one of the major Eurozone flaws is that every country must agree to change the pact.

One Day

Flashback December 12, 2016: 

​This is what was said at the time regarding Italian complacency.

The Italy won't leave rationale looks like this:

• The Five Star Movement (M5S) would have to get into power, but the new technocrat government's first mission is to rig the rules so that does not happen.
• Even if M5S wins the lower parliament, it still may not control the senate.
• Even if M5S takes complete control of parliament, it would have to change the constitution.
• Changing the constitution without a super majority would require a vote.

This was my explicit warning:

"The problem with the above thesis is there is only one party that wants to keep the Euro and coalitions will form if for no other reason than people are fed up."