Portugal's top court has ruled out euro membership

Whether Portugal's judges realise it or not, they have just ruled that the eurozone doctrine of "internal devaluation" is unconstitutional.

Since this is the central thrust of EMU crisis strategy – and the only way offered for Club Med states to regain lost competitiveness within monetary union – the court has essentially said that Portugal may no longer participate in the euro Project as currently constructed.

loaf: The public sector is out of control throughout The Western world. Unfortunately, the politicians and (constitutional) courts are public sector organisations too. As were the regulators who failed us all in the run-up to 2007.

wantonone: Yes out of control and unsustainable we cant afford them.

lisboncalling4me: Yes we need Maggie back! Just look how successful Uk has become!

tomaso: Do you mean we are successful because or in spite of her?

harper1970: 'Will Mr Passos Coelho do this? Little chance. He will persist in trying to break his country on the wheel, until it breaks him. ' ambrose…you seem to have realized that we are dealing with extremists…as ive been saying for the last few years…and like all extremists they are very very dangerous people who will stop at nothing to make their dream a reality…and their dream is to bring down all sovereign states in europe and create a new nation out of the rubble…

PierrePendre:     He should accept that Portugal's top court has expressed the will of the nation. ----------------     Doesn't sound quite right to me. How does an unelected court represent the national will more legitimately than an elected government?     Presumably, the court had no objection to Portugal sacrificing its economic sovereignty when it joined the euro. But now it has qualms about the government obeying the single currency's rulebook.     Are these qualms legal or political?     One of the things that makes the EU such a charade is that it blithely ignores the rule of the laws it itself passes. Doing so discredits the EU as one institution and the law as another which is supposed to be independent.     It is to the shame of Germany that its constitutional court bends the law to the demands of politics in EU matters. Now we are supposed to applaud the Portuguese court because it has a better sense of political justice than the elected government.     This is a mess. Elected parliaments make law; judges interpret and apply it; blurring the distinction between the two roles is a recipe for constitutional mayhem.     Before we know it, Ed Balls will be going to court to persuade Cocklecarrot to overturn George Osborne's budgets on the grounds that they don't reflect the national will.

lisboncalling4me: "Doesn't sound quite right to me. How does an unelected court represent the national will more legitimately than an elected government?" In the same way german Constitutional Court ruled in favor of the ESM bail out fund without public support… You always seem to have a double face towards some countries… Such solid and democratic convictions

montpon: Normally I think your posts are pretty good but on this one I think you have it wrong.  Lawmakers can amend a constitution, depending upon the rules that apply in a given country, but the Government of the day cannot ignore a constitution.  In this respect the Constitutional Court, rightly so, can hold the government to account and overrule it if necessary.  This is equally so in Germany, France and elsewhere. That is, for example, why the German government cannot just commit to more bailouts without the express consent of the Bundestag - as so ruled by their Constitutional Court.

edhooper: montpon Yes, that's how I see it as well. The Portuguese Parliament veered away from the country's constitution when it imposed its austerity policies and the courts have put it firmly back on course. I believe it also worth re-stating that throughout this crisis the policy of the EU's politicians has been to bend and break the rules whenever it has suited, in order to hold their project together.

plaintalk: The E.U. needs to abide by its own constitution before it continues to demand that everyone bends theirs anymore!

unhappyscientist: Mr Passos Coelho and his mates in the EU-IMF Troika appear to have a little problem. However I'm sure his best buddy, the fat Queen Barroso, is reassuring him and telling him not to worry. Just a little 'local difficulty'. After all who cares about the ruling of 'the Top Court'  in a small western region of the EUSSR when the survival of the "Great Dream" is at stake. I hope Portugal's 10-year yields go through the roof as they should. Seems the EURO won't die - multiple 'Stakes through the heart' seem to have little effect.

sonofapigandamonkey: allow me to translate for the retiree:…all of us retirees and civil servants want you working people to give, and keep giving,  to us your money regardless of the hardships you are suffering…the constitutional tribunal has said so…and if the health education of your children suffers in the meantime…tough

curryoracle: The German constitution forbids budget deficits and transfer payments to bankrupt Mediterranean states. Why should anyone expect the Germans to ignore their laws so the Portuguese can keep to theirs, particularly when theirs is based on economic unreality?  The reason why the Euro is unworkable is because of the something-for-nothing boys on the Med. They're not going to get their way- it's either deflate or out.

idilliopozzi: Astonishing! "The German Constitution forbids budgets deficits and transfer payments to bankrupt Meditarranian States". The Italian budget deficits, supposing it is mediterranian,  is 2.4% of GNP in conformity with EU agreements and Italy never received any transfer payment from Germany,  and does nott expect any. Notwithstanding that, the German Constitution forbids… but eventually allows in favour of Nothern Countries? curryoracle is showing a confused mind.

curryoracle: I hope Italy does pull through, but it is going to have to cut to do so. The reason why interest rates on Italian debt are high is that the markets believe it will default. Given the outcome of the recent election, that's a reasonable assessment.

idilliopozzi: The Italian deficit is 2,4% and public debt is 120% with solid reasources of guarantees. The spread with german 10 years bonds is about 300, French is 50 but deficit is higher and debt indreasing. Why such a difference including Belgian and Austria? The Italian recurrent amounts of new Bonds is always covered by Financial Markets and the rate of interest, although convenient, is not due to risk. The difference is due to speculative financial activity with dissamination of exagerated alarming informations about political situations, example: Italy has no Government which is not true as Monti Government is there to govern untill there will be one for replaceing. There is a diffamatory activity whose purpose is that to obtain favourable interests by safe investments.

sein_schatten: Curryoracle is more or less right. Under German law any Government is forbidden to give LOANS to a recepient, that is considered (or proven) incapable of paying back the money. This is done to prevent any government to pull the wool over the publics eyes, by simply pretending "don't worry folks, its only loans". However any German government is free to gift or handout money if they like, especially if the Bundestag approves it. Although AFAIK the amount of gifted money shall not endager the stability of German democracy.   So geographic direction, does NOT come into play here.

lisboncalling4me: "The German constitution forbids budget deficits and transfer payments to bankrupt Mediterranean states" Well, as long as they kept buying german goods, it seemed ok…

lisboncalling4me: The reason WHY the euro was created was definitely NOT because of the Med… What about that!

curryoracle: It was created at the behest of the French. The Germans went along with the whole thing admittedly, but it wasn't them that demanded it.

lisboncalling4me: "The Germans went along with the whole thing admittedly, but it wasn't them that demanded it." They gave they seal of approval and that's that! If Germany had a guilt feeling towards France, its their business and quiet frankly a result of Germany's ambitions of the past, imputed exclusively on Germany

tomaso: Italy is in the Med, and they are amongst the founders of the Euro.

lisboncalling4me: I was talking about the political motivations behind the euro…