KARLSRUHE, Germany — Germany's finance minister defended the rescue packages for Greece and other eurozone countries at a supreme court hearing on Tuesday, as opponents argued that the bailouts violated both German and European law.
Wolfgang Schaeuble told the Federal Constitutional Court that "the stability of the euro is of paramount significance."
He pointed to the risk of financial instability across Europe and beyond at the time the government signed on to the initial Greek rescue of May 2010 and, shortly afterward, the wider eurozone fund.
Those plans foresee Germany — Europe's biggest economy — guaranteeing loans up to €22.4 billion ($32.5 billion) for Greece and €147.6 billion for other countries.
The plaintiffs filed their suit to block the rescue measures before they were agreed and now want Germany to pull out of them. Among the plaintiffs is Peter Gauweiler, a backbench lawmaker with Chancellor Angela Merkel's conservative bloc who has challenged previous European integration measures, as well as a group of professors.
Chief Justice Andreas Vosskuhle said the right economic strategy in the crisis was a matter for politicians, not judges. But, he said, his court "has to consider the limits that the constitution sets for politicians."
Karl Albrecht Schachtschneider, speaking for the professors, insisted that "what is economically wrong can't be legally right."
He argued that the rescue measures violated a no-bailout provision in the European Union's Lisbon treaty without sufficient justification.
He also contended that they violated German constitutional clauses protecting property, by spawning inflation, and democracy — by restricting the German parliament's control over its own budget.
"A union of liability and debt favoring other states has been created," he said.
Gauweiler's representative, Dietrich Murswiek, pointed to current efforts to set up a second Greek rescue package, arguing that loans would sink into a "bottomless pit."
Governments, the European Commission and European Central Bank "agreed on a blatant breach of the constitution and are even proud of it," Murswiek alleged. "I know of no comparable case."
"'Saving the euro' by destroying the fundamental norms of the currency's constitution is like trying to repair water damage by blowing up the house," he added.
In addition, "the rescue fund serves in reality to take risks away from certain big banks," Murswiek said, arguing that would be unconstitutional.
He said Greece's woes were "not the result of an event beyond the control of the state" but the product of years of policies that piled up debt.
Schaeuble said the government was on solid legal ground.
He pointed to German-led efforts to toughen rules governing the 17-nation euro, set up a permanent rescue mechanism and improve countries' competitiveness — efforts which he said need time — and argued that no major stabilization measure had been taken without parliament's approval.
"A common currency can't do without the solidarity of all members," Schaeuble said — even as he underscored the tough conditions attached.
"How strict these conditions are is proven by how long euro countries with problems — Ireland, Portugal — resisted being brought under the European rescue fund, so that in view of the systemic contagion risk and the danger for the stability of the eurozone as a whole they almost had to be pushed," Schaeuble said.
"Greece must fulfill very tough conditions," he added.
Schaeuble's Greek counterpart, Evangelos Venizelos, is due in Berlin Wednesday for a working dinner with the minister.
Government lawyer Ulrich Haede rejected the plaintiffs' arguments that setting up the eurozone rescue fund was effectively a change to EU treaties by the back door. And he said the amount of money involved was "not so extraordinary" that it undermined parliamentary control over the budget.
Government lawmaker Siegfried Kauder, speaking for parliament, said the measures were given full consideration by lawmakers and "no one was forced to vote in favor."
"It's inaccurate to speak of a 'transfer union,'" he said. "There is no ban on solidarity in European law. One doesn't have to help, but one can."
A ruling is expected later this year.