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Second Order Consequences

The Bundestag is about to pass the EFSF legislation with a thumping majority but be very careful how you interpret this vote.

Rather than endorsing the urgency for a more expansive solution to the rolling EuroZone 'debt crisis'  ..... this legislation has passed on solely Germanic concerns.

Two contributions (both sourced from the FT) warn of the (unintended?) second order consequences of this vote.

First - Schaeble (Finanace minister): 'insisted the EFSF would not be secretly boosted by financial leverage ...... it will not be increased ..... that is not under discussion.'

Second - and arguably more profound for the future of the Euro - Norbert Barthle (CDU Budget Spokesman):  'the new law - with its commitment to give the German parliament a vote on all future changes in the EuroZone crisis measures - mean a totally new form of Democratic legitimacy for the EU legislation in Germany.'

If I was the most rabid Germany Euro-sceptic ..... I would have voted for this.

German (democratic) populism will now decide. And that's a good thing - right?

Third order consequences to follow.