German union, employers group back euro fund

German union, employers' association urge backing for stronger eurozone fund

Associated Press

BERLIN (AP) -- Germany's top labor union official and the head of its main employers' association urged lawmakers on Wednesday to back plans to strengthen the eurozone rescue fund in an upcoming vote.Parliament's lower house will vote Thursday on giving the so-called European Financial Stability Facility euro440 billion ($595 billion) new powers and increasing its lending capacity.Michael Sommer and Dieter Hundt -- the heads of Germany's main union federation and of its employer association, respectively -- said in a rare joint statement that lawmakers are voting "on the future of Europe.""This measure won't be sufficient to master the debt crisis, but without the expanded EFSF incalculable costs would arise to Europe's detriment," they said.Broad approval of the changes looks assured, with two opposition parties saying they will vote in favor.However, the issue has highlighted tensions in Chancellor Angela Merkel's center-right coalition. She has been trying to overcome distaste among some at making further commitments to back the eurozone's strugglers, and at least a small group of lawmakers plan to vote against.One of those is Frank Schaeffler of the Free Democratic Party, the junior coalition partner, who has been an outspoken opponent from the start of European leaders' bailout efforts and argues that Greece should leave the eurozone.Schaeffler suggested that most lawmakers who backed creating the EFSF last year aren't likely to vote against it now -- but that it may be a different story when it comes to a vote early next year on the fund's permanent replacement, the European Stability Mechanism, which is due to take effect in 2013.The government won't be able to swing lawmakers behind the ESM because "the crisis will speed up, and at the same time it will then become clearer to even more colleagues that what we are now doing isn't helping, but actually is only making the crisis worse," Schaeffler asserted.The problem with the crisis response is that "we are overriding risk and responsibility, that we are perverting the market economy in Europe," he told reporters.Schaeffler wants to force a vote among FDP members on a motion that would urge the party to reject the ESM. He said Wednesday that he's close to getting enough signatures to force a ballot.Party leaders have insisted they are not worried by Schaeffler's plans.

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