The Euro Is Irreversible! … or Is It? On OMT, Austerity and the Threat Of ‘Grexit’

Abstract

Does the European Central Bank (‘ECB’) have the mandate to do ‘whatever it takes’ to save the Euro? While the German Constitutional Court answered the question with a clear ‘no’, the European Court of Justice suggested that the ECB did in fact have that mandate. This judicial battle for the Euro, however, is only part of a story that involves political power struggles between Germany and Greece; that saw the emergence of ideological schisms in the EU on the issue of austerity; and created the real risk that for the first time a Member State would be forced to leave the EU.

Keywords: Euro-Crisis; ECB; OMT; Austerity; ECJ; German Constitutional Court