The Central bank of the Union - objectives

I begin this post with a quote of a saying “Money is always only on the first place”. Its author was somebody from a circle of Václav Klaus, the first post-communist minister of finance of Czechoslovakia then, shortly after the year 1989 when Czechoslovakia began under his management creating flourishing capitalist society with an intention “to catch up with Europe”. That saying that became popular soon was a cynical expression of an attitude that Václav Klaus held: we (at least somebody) must get rich by any possible means, must not have regards for anything and not let be restricted, in particular not with morality or even laws. It can therefore appear that validity of that saying is limited with place and time to wild transition of central-eastern and eastern Europe to capitalism but it has more general validity. Paradoxically those who only learned what capitalism is exactly articulated its most significant feature – worshiping money. But I want not to moralize about influence of money on the human society in this place, I used the saying because it excellently puts its finger on the most significant feature of human doing in Europe today. But it is surprising all the more so that what everything bows to in reality gets only small attention in documents the function of which is to determine principal rules governing functioning of states.

Supervision over money or currency is entrusted to a central bank in every European state because reality demands it. But if we should judge only by constitutions of the European states we would reach the conclusion that central banks are anything but equal with parliaments, governments and courts by their importance – in the society where central banks (at least some of them) can take measures of more significant implication than parliaments, governments and courts together really strange thing. From 28 constitutions of the present EU states, there is not a mention about existence of a central bank in the respective state in 15 of them – it is absolutely unbelievable thing in capitalism but it would not be less surprising even if there was not capitalism in Europe. In remaining 13 constitutions usually one or few sentences are that mention existence of a central bank, give a definition of its function and refer the rest to a separate law; in some constitutions existence of a central bank is mentioned only by the way and its functions are not defined. If matters referring to, for example, the parliament were prescribed in the same way it would be written only: “For the purpose of exercising the legislative power, there is a parliament. Its functions and powers are stipulated by the law.” The contrary is however true; a contrast between detailed regulations about a form, composition, election, powers and work procedures of parliaments in the European constitutions and almost complete absence of similar regulations referring to central banks could be justified only in the case that central banks would be little important institutions equivalent to meteorologic institutes. It is however possible that the mentioned absence of regulations in the constitutions is maybe unintentional expression of that regulating money comes not under the main duties of the state. One would say – no wonder in neoliberal capitalism; but duties of a central bank are with at least a few sentences described in the constitutions of east-European states that were created in the era of neoliberal capitalism in which the markets have dominance over democratic politics whereas the constitutions of the western states created before neoliberal era conceal existence of central banks.

In every case, the present practice of the European constitutions is wholly untenable in the constitution of the European federation. It is out of the question that functioning of an institution performing such important function for the society, namely regulating money, is not regulated with more detailed provisions in the constitution than is usual now. These provisions have to regulate chiefly two most important things – the aim and duties of the central bank and a method of decision-making including its staffing. Now, I will deal with the first one.

From the very beginning when I started describing my idea of the constitution of the European federation here I subordinated everything to a fundamental categorical imperative that all public politics exercised by the institutions of the federation must be democratic, that they must proceed from the will of the European federation's people and must serve to interests of the federation's people. Also the central bank of the European federation must naturally be subjected to this categorical imperative because such important thing as the currency of the state must equally as other public matters be under democratic control of the citizens who are fundamentally affected by the currency. Thinking about democratic character of the European federation's central bank and in particular about democratic control of the currency of this state (utopian for now) I came to the conclusion that the bank cannot be a mere copy of central banks of the present European states (or of the European Central Bank). However, I reached also the conclusion that to subject the currency of the European federation to the democratic control is not possible without a radical change of at least some aspects of the financial system as such. “Money governs the world.” But who governs money?

The primary aim of the European Central Bank is to maintain price stability (article 127 of the Treaty on the Functioning of the European Union); the same applies also to the central banks of the state where euro is not the currency. But in my opinion the main duty of the central bank of the European federation should be something else, namely to issue the currency of the federation. The objective to maintain price stability loses not its importance by it but in the method of issuing the currency of the European federation that I am to write about discharging that objective becomes a component of issuing the currency and those aspects cannot be separated from each other.

In earlier times, a monarch issued money (it was a sovereign's privilege) although he temporarily conceded it to some aristocrats or (especially in a time of a crisis) to some cunning businessmen (who promised to fulfill the empty treasury). In the modern time, monarchs were replaced by parliaments and governments and the right to issue money passed to a specialized state organ – a central bank. But the central banks of today do not the same as the monarchs earlier although it can look so at first sight. Any central bank in Europe (including the European Central Bank) has the exclusive right to issue banknotes and coins of the respective state currency (the ECB with its unique attributes). But it is by no means the privilege to issue the money in its whole because money has not only the form of banknotes and coins today – banknotes and coins from the times of monarchs were supplemented with electronic money in the 20th century and it is not completely issued by central banks; on the contrary, it predominantly originates in private commercial banks. In other words – the present state has not the privilege to issue its currency.

The main function of commercial banks is to grant credits, in other words to lend out money. They lend however not the money of savers because value of balances of savers' accounts is not affected by credit activity of the banks. In fact banks set a value of a credit in their computers and it grant to an applicant then; what is important, the applicant then can pay with the credit obtained this way as with “real” money, namely as with banknotes and coins. Because balances of savers' accounts remain unchanged new money that was not issued by the central bank come into circulation this way. The commercial banks are – mildly – limited in this action but credit money (or debt money) issued in circulation by one bank other banks can multiplicate and so the amount of money issued by the commercial banks is considerable in the end – the central bank is one, commercial banks are thousands. The outcome is that about 90% of all money are issued by private commercial banks and only about 10% of circulating money are issued by the central bank (I found this ratio equally for the Swiss franc and US dollar, I suppose however that this ratio is similar for other currencies). We got back with this to the times when monarchs conceded their currency privilege to private persons but we even surpassed them because no monarch relinquished his right to issue money to such large degree.

The present system has two implications for me: it is immoral and nondemocratic. If I make an imitation of a banknote in my house printer and try to pay with it I will be (severely) punished; if a bank makes money from nothing in its computers and grants it as a credit it will not be punished for it, to the contrary, it will be praised that it sets wheels of capitalist economy in motion. But there is no difference between me and the bank – I extend the amount of the money supply to achieve my private benefit, the bank extends the amount of the money supply to achieve its private benefit (the commercial banks are capitalist enterprises existing for achieving private profit). So why I should not have the right to issue new money into circulation for my enrichment whereas the owner of the bank should have the right? In addition, it is absurd in this situation that banknotes have a lot of security measures in order that they could not be imitated, on the other hand there is no security measure against imitating tangible money by pressing a key in the keyboard. And a practice caps it all that the present states borrow (instead of levying firm taxes) just the money created from nothing by the private banks in the financial markets and then they guarantee the loan with working of their citizens – almost effortless profit for the bankers secured. Who would not want to be a banker?

The second consequence follows from the character of money – money serves to all citizens, it is something like air or water in a way, therefore it should be considered a public property. But a public property should be under the democratic control in a democratic society and handling it should not be transferred to a private subject. Whereas issuing money by the central bank can be regulated through laws and the central bank is or should be this (or other that I will write about later) way responsible to the citizens, the commercial banks are responsible to nobody apart from the pocket of its owner. Massive creation of new money by commercial banks leads to devaluation of the currency or inflation to which then the central bank must react with its measures to curb it. It is paradoxical that it is wrong according to economists that issuing money is under the control of the government because it would have temptation to print money without limits to cover its expenditures and so cause inflation but the same economists do not mind that the private banks have almost that power today. It has to be admitted that the central banks have certain tools to react to inflation caused by issuing money through the commercial banks but it is only reaction to action of private subjects.

These two conclusions cause that I believe that issuing whatever form of money in circulation in the European federation can be entrusted only to the central bank under democratic laws and democratic control. I must however add to this that I am not completely sure how to properly formulate the mentioned requirement in the constitution's text. The best is in my view the reading “The Central Bank of the Union is a exclusive issuer of coins, banknotes and any other units of the currency of the Union.” But the text of the Polish constitution causes some dilemma to me; it says (article 227) that the Polish national bank “shall have the exclusive right to issue money“ (original wording is: “Centralnym bankiem państwa jest Narodowy Bank Polski. Przysługuje mu wyłączne prawo emisji pieniądza oraz ustalania i realizowania polityki pieniężnej.”) It should follow from this wording that expanding the money supply through credit activity of the commercial banks should be unconstitutional in Poland, in practice however there is the common capitalist bank industry with all common appurtenance in Poland. It can be probably concluded from it that money created through credit by the private banks in the territory of Poland is not considered money by Polish public authorities (the Polish central bank states in its web pages only issuing banknotes and coins as its competence) and it therefore comes not under the competence of the central bank which is absurd because one can pay with credit-created money just as with money issued by the central bank. It is unconstitutional after all in my view if wording of the Polish constitution should be taken seriously and it is at least an absurd situation but where is a plaintiff absent there is a judge absent as a proverb says. Hence my doubt whether my wording mentioned above will be interpreted correctly as a prohibition to issue money through credit in the commercial banks.

I read several popularizing books about economy and it is strange that the authors criticised existence of the central banks and advocated free enterprise in the economic field. It is obvious that the mentioned books are biased, they were written from the view of one economic theory (that all enterprise should be unregulated in capitalism) yet their criticising the central banks touches a certain possible problem. In the present system, if there is not a crisis, probably the main source of inflation is multiplying money through credit activity of the commercial banks. But it follows not that the central banks have no possibilities of inducing inflation. They do it for example through purchase of government bonds and other open market operations; all such tools have as their object to pour money in economy (first of all in the commercial banks) which increases inflation. If there should be a system of exclusive issuing the currency of the federation by its central bank in the future European federation and if the commercial banks should be forbidden from creating new money through credit activity the central bank becomes the only institution capable of inducing inflation (I simplify, I know, inflation is a bit more complicated matter). In that case it is necessary to insert such provision in the European federation's constitution that prevents its central bank from inducing inflation. Should I not write “unchecked inflation” instead just “inflation”? Laws determine to maintain price stability as a primary objective to the central banks which is another way how to say that they should fight inflation. But the said laws do not specify what exactly the central banks should achieve and in what way; it is left to their deliberation. A dilettante would say that price stability is zero inflation, but economists express their opinion that moderate inflation is beneficial. There are various substantiations for this. One of them says that the central banks do not know exactly the inflation rate but they assume that it is lower than the measured one and therefore they keep it slightly above zero (around 2%). Another substantiation says that moderate inflation is a security measure in order that the central bank has a manoeuvring space for the case of a potential crisis, yet another that it stimulates economy because consumers do not delay their consumption because they expect that prices will be higher due to inflation in the future. These all and other substantiations may be true but also need not to; however if inflation is defined as devaluation of the currency I am for zero inflation as a primary objective of the federal bank of the European federation (by the words that is should preserve stable value of the currency of the Union – inflation is by contrast constant devaluation). The matter of inflation and its role in action of the central bank of the European federation is complex so I leave some other remarks of this thing to the next post.

Federal plebiscite - constitutional text

I still owe a constitutional text to the previous article dealing with the subject of the federal plebiscite, so it is here.

Federal plebiscite

Article 55 – Direct exercise of the state power

1. The citizens of the European Union exercise the direct state power by means of the federal plebiscite. The decision is made in the form of the law or the international treaty.

2. The laws and international treaties adopted in the federal plebiscite are inscribed in the Official Journal of the European Union.

Article 56 – Obligatory plebiscite

The federal plebiscite is obligatory about

a) modification of the constitution of the European Union,

b) laws expanding the constitution of the European Union,

c) accession of the European Union to an international organization or a military alliance,

d) adoption of an international treaty or withdrawal of it,

e) adoption of a new member of the Union,

f) a law about the status of the federal territory.

Article 57 – Restriction of the subject of voting

Restriction or abolition of democratic public order and restriction or abolition of the rights in the Chapter two of the Constitution of the Union, in particular prohibition of death penalty, torture, slavery or other cruel treatment may not be the subject of the federal plebiscite.

Article 58 – Organization of voting

1. The federal plebiscite is declared if at least 0,78% of the citizens of the Union authorized to vote to the House of People of the Assembly of the Union from at least eight member states request it.

2. The Council of Chancellors declares the date of the federal plebiscite being no more than 200 days after the day when the required number of the citizens request it.

3. The request of the citizens of the Union is not necessary to hold the federal plebiscite about the matters enumerated in the article 56.

4. The Council of Chancellors may submit any proposed law passed by the Assembly of the Union and submitted to itself for the federal plebiscite.

5. The law stipulates details about organization of the federal plebiscite.

Article 59 – Repeated voting

The matter rejected in the federal plebiscite may not be submitted again to the people earlier than after three years.

Subsection 1 – Federal plebiscite about a proposed law

Article 60 – Subject of voting and adoption of a law

1. Any legal arrangement of a matter that comes under competence of the Union can be the subject of the federal plebiscite about a proposed law. In one voting, more different proposals of the same thing can be submitted.

2. Modification of the constitution of the Union or a law expanding the constitution is adopted if at least two thirds of involved voters and at the same time two thirds of the member states vote in favour of it. Result of voting in the member state counts as the vote of the state.

3. A law except of a law expanding the constitution is adopted if the majority of involved voters and at the same time the majority of the member states vote in favour of it. Result of voting in the member state counts as the vote of the state.

Article 61 – Limits in adoption of a law

1. The Assembly of the Union may not repeal or modify a law adopted in the federal plebiscite.

2. A bill containing a matter rejected in the federal plebiscite must not be introduced in the Assembly of the Union for a period of three years.

3. The law adopted in the federal plebiscite must comply with conditions of paragraphs 10, 11, 12 of the article 33.

Subsection 2 – Federal plebiscite about an international treaty

Article 62 – Adoption of an international treaty

1. After an international treaty is submitted to the people a term of 200 day runs during which at least 50000 citizens of the Union authorized to vote to the House of the People of the Assembly of the Union can submit proposals of the change of the submitted international treaty. If such proposals are submitted there is voting about more proposals of the international treaty at the same time.

2. The international treaty is adopted if a majority of involved voters and at the same time a majority of the member states vote in favour of it. Result of voting in the member state counts as the vote of the state.

3. An international treaty that endangers democratic public order in the European Union or is inconsistent with rights, freedoms and principles provided in the chapter two of this constitution cannot be adopted.

4. Accession of the European Union to an international organization or a military alliance must have the form of an international treaty that contains all obligations and right of the Union within the respective organization or alliance.

Supreme Audit Office of the Union

The power of the modern state is separated into the legislative, executive and judicial power in theory. It is true on principle, the state of today however has also other institutions available that cannot unambiguously be classified within the mentioned three powers. This is also true about an institution whose function is to inspect (to audit) economic administration of the state and its parts; it is sometimes labeled as the fourth audit power. It is beyond doubt that the future European federation too cannot do without this component of the state power. There are usually not many provisions about a audit body in constitutions of the European states, neither the European federation's constitution needs to be an exception; but I consider to be necessary that at least two thing are included in the constitution's text – a way of staffing and its powers.

A question how the people who inspect state institutions get in their positions can be answered after the answer to the question about essence of this office. Existence of a supervisory institution itself is a logical expression of the principle that nobody will control himself or at least not objectively. There is an element of compulsion in necessity to let to be audited and the superior audit office so stands against everyone in a way. This its position demands that it is as independent on the inspected institutions as possible. In the European states officials of the supreme audit institutions are usually appointed in their positions by the parliament, sometimes by the government or the president. It in itself needs not to be an obstacle to independence of audit office but this tie may arouse some doubts sometimes after all whether it will proceed towards all state institutions equally resolutely. It is also suitable to realize that relations among individual state institutions despite theoretically good separation of powers are in reality influenced by existence of a factor which constitutions not much deal with, namely political parties. In my opinion the audit office of the European federation should be more than an information agency, it should be the real fourth state power, independent on the three other ones. A conclusion follows from it for me that its establishment should be independent on three other powers, not derived from them, although the main essence of its independence should ground in its powers. By the way, it is striking that everyone regards as self-evident that democracy works in the way that the people only elects deputies of the parliament and the other constituents of the state are established already without participation of the people. If the people should have at least some control how those who are supposed to manage its matters administer funds, direct election is more suitable than if political groups themselves assure who will inspect them.

If there is a demand for direct election of officials of the European federal audit office, its internal structure must be discussed simultaneously because it will be dependent on it who actually should be elected. All auditing stuff naturally in view of its number (hundreds of them) cannot be elected, the election therefore can only apply to a board with competencies to decide. Here a question emerges whether the European federal audit office should have a collective or one-person management. I believe that it is the most advantageous for citizens if only a president of the office endowed with powers corresponding to that fact is directly elected and he (she) himself appoints other members of the management. The president should be elected according to the same rules as the members of the Council of Chancellors and the President of the Supreme Court. As for the term of mandate of the president, I adhere to the practice of the Court of Auditors of the present European Union. It is useful (and in accord with real practice) to establish audit departments branch-oriented according to objects of the audit inside the office and heads of these departments are who I mean as the superior management and who should be appointed by the president of the office. Appointment of other stuff of the departments can be in the hands of their heads but with final approval of the president. As for decision-making, I believe that the president of the office on the basis of his direct mandate from the citizens should be entrusted with all significant competencies (besides administration of the office itself and its representation externally those are to establish the audit plan and to approve audit reports) and the heads of the departments should be a consultative body for his decision-making.

In order that the audit office of the European federation deserves its label of fourth state power its competencies have to correspond to it, especially if it is (in decisive regard) directly elected. What is therefore necessary is wide range of inspected institutions, independence at auditing activity and first of all, enforceability of remedy of imperfections if they were detected.

Among institutions whose fund managing should be inspected must be above all the Assembly of the Union, the Council of Chancellors and the Supreme Court which are the supreme constitutional bodies, besides them also all offices exercising a role of ministries or specialized administrative offices (as for example a statistical office) as well as all public institutions which are entirely or for the most part paid by the Union (as for example science institutions). Also the member states and their autonomous parts as well as private subjects must be inspected if they obtained financial resources from the Union. The army in all its units must not be absent from the list of inspected institutions and not at all economic enterprises. Funds management of the Central Bank of the Union and the Federal Investment Bank (about these later) must also come under audit, at the Central Bank also issue of money and securities. Conclusion of the list of inspected items is then formed by implementation of the state budget of the Union, the state final account and awarding public contracts (on the part of the Union).

To deal with an outcome of the audit is a very important part of the inspect process and I want to diverge from the usual practice here. Supreme audit state bodies are usually formed as a kind of detective agencies assignment of which is to submit reports to other authorities of the state power. An audit report is naturally submitted to a inspected body and to a superior body too which should organize rectification in the case that imperfections were detected; in addition to that the audit office submits a report about its activity at times (once in the year). A danger threatens however that the work of the audit office will be devalued by that a state body within which power is to accomplish rectification of detected imperfections or to punish guilty persons does not accomplish rectification and does not punish the guilty persons, especially when a “political interest” will be in it. It is amazing that the politicians do not dare to disregard reports of their audit office in some European states but this certainly is not true in all Europe; and in general, organization of the state cannot be built on unconditional trust in kindness of people. My opinion is that people must be compelled to proper behaviour sometimes and it proceeds from it that I want to give a possibility to the audit office of the European federation to at least partially enforce rectification of its negative findings. But not directly, I want to observe separation of powers and tasks to some extent. It is for example not autotelic that the court decides about guilt and punishment but cannot bring a charge, it is not autotelic as well that the parliament adopts laws but not executes them. It is not appropriate as well that the audit office finds out wrong funds management or even a peculation and itself secures a remedy. But what I consider as necessary is that it has the right generally to order rectification of detected defects to competence authorities (the concrete form of rectification will be a thing of the competent authority) and to control whether rectification was accomplished and whether it meets the purpose. Besides that, it is my intention to give a power to the audit office of the European federation to bring accusations to the federal courts against persons responsible for negligent funds management, for peculation and similar imperfections and offences if they were detected at inspection and also competent authorities for not accomplishing remedy measures. Only if the audit office has coercive powers it is with certainty taken seriously by everybody and it will so justifiably join the three main parts of the state power.

There is a question in the end whether the audit body itself should be uninspected. That is naturally not possible, the audit office therefore must be subjected to the inspection too and the Assembly of the Union is the best choice for it.

Supreme Audit Office of the Union

Article 54 – Audit power of the Union

1. The power to exercise audit of public funds management belongs to the Supreme Audit Office of the Union.

2. The Supreme Audit Office of the Union has its seat in the Federal Region of Brussels.

3. The Office is subjected to supervision by the Assembly of the Union.

Article 55 - Composition

1. The Supreme Audit Office of the Union is composed of the President and the High Auditors of the Union. Each High Auditor is the head of an Audit Department; the law stipulates their number and subject jurisdiction.

2. Every citizen of the Union who completed the age of 40 years can be the President of the Supreme Audit Office of the Union or the High Auditor of the Union.

3. The term of mandate of the President and the High Auditor is six years. Nobody can be the President or the High Auditor more than twice.

4. Details are stipulated by the law.

Article 56 – Election and appointment of members of the Supreme Audit Office

1. The President of the Supreme Audit Office of the Union is elected by the citizens of the Union according to provisions of the article 47 of this constitution.

2. The High Auditors of the Union are appointed by the President of the Office. At most two High Auditors can be the citizens of the same member state as the President of the Office.

3. Other staff of the Office are appointed by the President or by High Auditors with approval of the President.

4. The law stipulates details.

Article 57 – Rights and duties of the members of the Supreme Audit Office of the Union

1. The President, the High Auditor or other member of the Office carrying out the direct control activity is not allowed to hold any constitutional or other salaried office of the European Union, of any member state or its autonomous entity, to engage in other paid occupation, to receive any remunerations and to give unpaid consultancy.

2. The member of the Office carrying out the direct control activity may not be prosecuted, restricted in his free movement or arrested unless caught while committing a criminal act.

3. The members of the Office receive a salary paid from means of the Union.

4. The mandate of the High Auditor becomes effective by his appointment. The mandate of the President of the Office becomes effective by his election.

5. The mandate of the President of the Office and the High Auditor expires by

(a) expiration of the term of mandate,

(b) resignation,

(c) death,

(d) exercise of an incompatible function,

(e) sentence for a deliberate offence.

6. The law stipulates details.

Article 58 – The President of the Office

1. The President of the Supreme Audit Office of the Union

(a) administers the Office and represents it externally,

(b) develops the plan of auditing activities and its changes,

(c) authorizes audit reports,

(d) develops the report on the work of the Office,

(e) brings actions following from the audit reports.

2. The President of the Office making his decisions consults the board of the High Auditors.

Article 59 – Control activity of the Office

1. The Supreme Audit Office of the Union shall audit

(a) the implementation of the State Budget of the Union,

(b) the state final account of the Union,

(c) administration of public funds by every institution stated in this constitution as well as all units of the armed forces of the Union,

(d) funds management of public institutions which are entirely or for the most part paid by the Union,

(e) funds management of the Central Bank of the Union and the Federal Investment Bank and issue of money and securities by the Central Bank,

(f) financial administration of enterprises in exclusive or majority ownership of the Union,

(g) administration of funds by private subjects if they obtained financial resources from the Union,

(h) awarding public contracts by the Union.

2. The audit applies to conformity of fund management with laws and other regulations of the Union and further to thrift, efficiency and expediency.
3. The institutions subjected to the audit have to provide all necessary data irrespective of the type

and degree of their secrecy.

4. The Supreme Audit Office of the Union carries out auditing activities in compliance with its own plan. It does not accept commands from any public institution of the Union or private subjects.

5. Details of course of the audit are stipulated by the law.

Article 60 – Conclusions of the audit

1. The audit report is submitted to the institution subjected to the audit and to a superior institution if possible.

2. To protest to a court against the audit report is admissible.

3. If violation of the law or imperfections are detected the audit report indicates responsible persons. The institution subjected to the audit and the superior institution are invited to take measures which will result in rectification. The institutions accomplishing rectification are obliged to inform the Supreme Audit Office of the Union which measures to rectification were accomplished.

4. The Supreme Audit Office of the Union brings actions for peculation, neglect in administration of public property and other detected imperfections as well as for not accomplishing or unsatisfactory accomplishing rectifications.

5. The law stipulates details.

Federal plebiscite

Besides three main till now described branches of state power of a European federation, there are other that should in my opinion be present in the constitution of the European federation but I want to interrupt writing about them and to deal with something else now.

Most bodies that constitutions mention exercise (or at least should exercise) the people's will indirectly. It is possible to debate how much they really exercise the people's will and to what extent they only formally refer to it; it is however important that most state systems in Europe takes only very limitedly direct exercise of the people's will into account. From a point of view one could even say that the people in Europe grew mature not yet from the 19th century when modern society came into existence and that it is necessary that “experts” think and decide for the people. And it has to be remarked that what is called democracy has not substantially evolved since then to now, at most by spreading universal suffrage. Nothing is naturally black and white, the society of today is very complex and managing public affairs really needs experts. On the other hand, only in fairy tales political authorities work only for welfare of the people, in reality also the power is associated with state (or more broadly public) offices and it not rarely serves to interests of the powerful. It is not only a theory, political practice of European states (transferred also on the common European level) speaks expressively. In order that this is restricted as much as possible it is necessary that the people has a possibility to decide on itself without professional politicians acting as mediators. Also the people naturally can decide wrongly but in that case it takes consequences of its bad decision itself whereas a caste of professional politicians is protected from consequences of its bad decisions both by its high salaries and contacts above standard with the powerful and rich. So it is a question of fairness; in addition to that I wrote earlier that a European federation, from its very beginning, must be based on the will of the people expressed by itself, not – unlike in existing unification of Europe – on the will of politicians for which the people is only passive viewer of their decisions.

So I will write here about the way of decision-making which usually is called a referendum. I will call it in other way in my proposal, a plebiscite because I like this word more than the previous one. Moreover, it is also etymologically more suitable because translated from Latin it means “decision of the people” whereas there is nothing similar in a word referendum though someone can object that in ancient Rome the word “plebs” denoted not the entire people but only its part, the unprivileged people – but it is appropriate in a way of speaking because the privileged ones do not need plebiscites to press their interests. Because I will discuss a plebiscite within the European federation I will call it a federal plebiscite.

Now I will pursue basic parameters that a federal plebiscite in my opinion should have in the European federation. The first thing is obligatory character and a form that comes up from the plebiscite. A plebiscite (referendum) can be either consultative or mandatory. The first one has no place in my concept. The meaning of a plebiscite is that the people can get around the will of professional politicians by means of it and decide about itself. In that case a plebiscite that only would give a recommendation to political elites lacks any purpose (all the more so that it would waste resources). If I proceed from the assumption that the people should be a ruler and politicians should be only its servants, it cannot be allowed that the people beg its servants by a not binding inquiry of public opinion. It l however also logically follows from it which form the plebiscite has to have. In referendums of the present time it is usual that a question is submitted to the people and it responds with “yes” or “no”. But again, if I proceed from a condition that the people is a sovereign and politicians are its servants, it is not an acceptable way. The people decide whether yes or no but politicians have again a final decisions in their hands and they can handle the result – though within certain limits – in a way that the people's decision devalues and adapts to their interests (or interests of their sponsors). It is therefore necessary that the federal plebiscite in the European federation has such outcome which could not be changed by politicians in any way. The only way how to satisfy this condition is to propose a draft bill but made by citizens, not a parliament or a government. Citizens would so answer “yes” or “no” not to a question “Do you agree that it is done…?” but whether they agree with a proposed bill which then directly comes or comes not into force. It could be also possible to propose more bills regarding one matter and the citizens would elect the proposal which is the most acceptable for them. It certainly offers greater possibilities for the people to decide than a mere yes-no to a question about which concrete implementation into a law (or into actions of the executive power) it decides no more after. I consider also to be necessary that every international treaty is approved by the plebiscite, again not as an answer to a question “do you agree that the European Union makes a treaty with… dealing with…?” but in the form of approval or disapproval of the final wording of a negotiated treaty. International treaties, subsequently integrated into the system of law of the state, are usually very momentous, they not a little influence lives of people and sometimes unfortunately, they serve the powerful to press their interests in a way that tries to circumvent the people and democratic procedures belonging to it (as a typical example, one can remark events around an international treaty ACTA and continuing tries to sneakily smuggle some its principles despite a rejection in other treaties or a treaty about trade partnership between USA and EU being secretly negotiated in these days which is to radically reduce democratic supervision over supranational corporations). I have to highlight in conclusion that it is insufficient to me that citizens can only give their opinion to laws passed by the parliament as the thing is arranged in Switzerland. The citizens of the European federation must have a right to propose and to pass any law in a plebiscite without necessity to be approved by the federal parliament. It is worldwide unique (as I know, only in the USA in the level of (some) member states this happens) but the present crisis age requires new forms of democracy if the present ones fail.

The citizens of the European federation should have the right to express their will in a plebiscite whenever they consider appropriate but in some cases, to hold a plebiscite must be obligatory. First, it is ratification of the federal constitution and any its changes which I wrote in my earlier posts about, second, ratification of every law that expands the constitution with further provisions (such law is pointed out by words like “the law stipulates details”). Further it is ratification of an international treaty that was mentioned in the previous paragraph and also accession of the European federation to an international organization or a military pact – a reason is that by accession to such organization a state conform to interests of other states in a certain extent or – in the present world – rather of certain elites linked with states only loosely (trade organizations of today are a typical example). Another example of an obligatory plebiscite that I also wrote earlier about is admission of a new member of the federation and I add one case more, namely voting about status of a federal territory: I wrote earlier that federal territories unlike “full” member states should have a possibility to adapt their relation to the federation in a specific way but because their status should not be generally unified yet exceptional it is necessary to approve every such exception by all citizens; this voting is of the same kind as a plebiscite about admission of a new member because both give assent to a change of internal conditions in the federation.

Opponents of plebiscites (referendums) from ranks of politicians admit only sporadic use of them about questions which themselves propose to the people. Argumentation in principle is that the people is not enough mature or knowing to decide about itself and also that the people could initiate voting about some very important matter having significant influence on the entire society and after that adopt a very bad decision. It is offensive in a way, as if the people was small children that need leadership of adults, on the other hand, it is true that irrational emotions really could outweigh prudence. For example, there is a danger that in a crisis the people willingly votes for extraordinary powers for some “saviour” who will “make order”. It is obvious that a plebiscite (referendum) is really not possible about some matters because it would disturb the ground of democracy itself and the human rights. It is therefore necessary in the text of the European federation to outlaw a plebiscite about restriction of democratic order (for example in a form of extraordinary powers) and of the rights listed in the constitution, in particular in the case of prohibition of death penalty, torture, slavery and similarly. Also the people must restrict itself in some things, Cicero's “We are slaves of the law to be able to be free” has its value here in hundred percent.

Now, it is turn of practical questions of accomplishment of a federal plebiscite. The first thing is an initiative leading to it. It is clear from what I have written that it is not acceptable that citizens only ask for holding a plebiscite and politicians decide whether they comply or not. A plebiscite must be held every time when the people decides to decide a public matter through it, the question is only what number of citizens should be necessary to initiate a plebiscite. Practice in the only European state that can serve as an example, in Switzerland, is a guideline for me. In that state it is necessary to collect 50000 signatures of citizens so that a facultative referendum about laws (already passed by the parliament) is held. It is circa 0,63% of all inhabitants of Switzerland and my opinion is that there is no obstacle to use this share also in the European federation. Not all inhabitants however are also citizens entitled to vote, a number of citizens certainly is lower and in the constitution, a required number of initiators of a plebiscite has to be related just to citizens with the right to vote, not inhabitants generally. I will proceed from a condition that voters are 80% of state's inhabitants (so is the actual number in the Czech Republic) although it may vary by some percents up or down in various states. In the concrete case of above mentioned Switzerland, the number of 50000 signatures corresponds to a share of 0,78% of voters if I use that 80% voters of entire population. As the formulation of a concrete number in the text of the European constitution is concerned the problem is that it cannot be known at present how the European federation will look, namely how many inhabitants and voter it will have. In addition, it can be expected that it will be a growing state similarly like the USA in the 19th century. Therefore it cannot be possible to give an absolute number (though it would look better) and what is only left is to give a share, namely the mentioned 0,78% of voters. And the federal structure of the European Union has not be forgotten so there is again a condition of citizens' signatures from more member states – I chose more than six states as in other similar cases mentioned earlier because the thing here is of greater significance: so I decided for eight member states.

Realization of a federal plebiscite will be in hands of the executive power, that is of the Council of Chancellors. So, to announce a concrete date of voting will be its power. The date should not be too early in order that the citizens are able sufficiently to talk over a topic of voting but also not too late. The first is not so grave because already collection of signatures will procure attention to a topic of a potential plebiscite, voting must however not be deferred too much after necessary signatures are collected so as thus artificial lowering of citizens' interest in a topic of voting is not caused. If it is necessary to take account of necessity to technically prepare voting I consider the term of 200 days as a deadline.

I have another three general remarks to organization of the federal plebiscite. If some topics should be subjected to a mandatory plebiscite, it is useless to collect citizens' subscriptions to initiate it, only the initiative of the Council of Chancellors suffices in that case. I believe further that it is suitable that there is a possibility to propose any law passed in the federal parliament to the people to a binding statement on initiative of the Council of Chancellors. It would a kind of a parallel to a Swiss facultative referendum which essence is also emendation of parliament's measures but in this case, it would be rather means of controlling the legislative power by the executive power and the people. The last of three mentioned remarks refers to repeating the plebiscite. It is naturally not possible to eliminate from the public space forever a matter rejected in a federal plebiscite; it is however necessary as well to give sufficient space to the people to newly reconsider the thing if a demand to solve it via a plebiscite still endures. The term of three years after which voting will repeat is most suitable in my view.

Other provisions specifying conditions of holding the federal plebiscite are divided by me in two subsections in compliance with a topic of voting. In the first subsection there are provisions referring to the plebiscite about changes of the federal constitution, laws completing the federal constitution and ordinary laws. The first two matters are more significant than the third one and voting about them must be more strict. There are two ways that can be chosen – either higher number of signatures to initiate a plebiscite about these questions will be required or there will be a requirement on greater majority to approve. The Swiss example goes by first way, at voting on changes of the federal constitution it requires double subscriptions of the citizens than for voting on other matters but only a simple majority (over 50%) of involved voters is sufficient to approve an issue in both cases. The contrary seems to me more logical, namely the same number of requests for initiating a plebiscite whatever its issue should be but greater majority for approving changes and completion of the federal constitution. A concrete number of such higher majority is a question. I have written about a simple majority everywhere till now, only in the case of outvoting a veto of the Council of Chancellors in the Assembly of the Union I suggested a majority of 4/7 which is 57%. It is however little for deciding about a change of the federal constitution in my view, such important thing should require a majority of 2/3 of voters which is around 66%. I add in essence mechanically that also here (and in particular here) is necessary to lay down a dual majority for voting according to the Swiss example which is a majority of all voters and at the same time a majority of states which means a result of voting within individual states. At voting about ordinary bills, a simple majority of 50% (but again double) suffices for their approval in the plebiscite.

Some things more that I add are provisions referring to the relation of the federal plebiscite to the parliament or to making laws generally. Somebody can regard as an expression of basic decency that if the people approves a bill in the plebiscite, the federal parliament will not try to repeal or at least change it. But to rely only on decency in politics is not reasonable because there is also a question of power in politics so I consider to be appropriate to explicitly determine a limitation in the constitution saying that the Assembly of Union must not repeal or change a bill passed in the federal plebiscite and at the same time, I add one provision more: that in the Assembly of Union a bill including a matter rejected in the federal plebiscite must not be introduced for three years – the reason is obvious, again to prevent circumventing the will of the people and the period of three years is identical with the period for which it is not possible to vote about the same issue in the federal plebiscite. Another thing that I consider to be important to add determines some requisites of a law that is supposed to arise from the federal plebiscite. I described such requisites in the section about the Assembly of Union, in the paragraph prescribing a procedure of adopting laws. Those are requisites that have either considerable importance or their violation would cause serious malfunctions in legal order of the European federation and they must be valid every time, also if a law passed through a plebiscite is dealt with – a way of adopting a law cannot be of any importance. Namely, those are the provisions that forbid to adopt a law contradicting the federal constitution, to adopt a law with retrospective force, to include more unrelated matters in one law (or prohibition of so called riders though there is less danger that they will be approved in the plebiscite than in the parliament); then a law about proclamation of the war must contain a ground of proclamation, unambiguous identification of an enemy and an objective of military actions.

The second subsection of my proposal comprises provisions dealing with voting about international treaties. It is practical that politicians negotiate conditions of a treaty but it suffices not in my view that the treaty is then submitted to the people's voting only as is. The present time shows that politicians in secret calmly sell the people to the “markets” and in addition they publicly celebrate themselves for it. So I integrated a provision into my proposal that the people has a possibility to suggest changes in a treaty submitted to it to decide in a period of 200 days before the day of voting itself. It is a safety measure to avoid that some provision detrimental to the people is hidden in an otherwise beneficial treaty (an analogy to riders in bills passed by the parliament) and to avoid that politicians can blackmail the people with a statement that a beneficial or even needful treaty must not be rejected only due to one “problematic” provision. The appropriate number of citizens authorized to propose a change in the text of the submitted treaty is in my view 50000, however without a requirement of their distribution among more member states because I do not consider it to be necessary here. That is a matter of voting itself which is another provision of my proposal. The simple majority (again however double) should suffice to approve an international treaty because the international treaty equals an ordinary law by its importance, not a law changing the constitution.

I came to the conclusion that one more safety measure has to be added though it can be in a certain way taken as an expression of mistrust to abilities of the people to recognize what is harmful for itself. What I have in mind I explain straight in an example. In Europe, legal and social protection of people working in state of employment (through regulations of individual states) is still in force, such as limitation of working time, paid holiday, regulations of occupational safety, a minimal wage (though this no everywhere), health and old age security and so on. But if the European community concludes a free trade treaty with, let us assume, an Asian state where there is no similar protection of employees, actually a double collision occurs with the human rights as I articulated them earlier and which after all largely are in force today. If on the basis of this treaty, goods (or in certain cases services) produced by people in situation almost slavish (which is the reality of today) are imported in Europe such goods will necessary be cheaper than the same goods produced in Europe by people enjoying many social rights – it will result either to elimination of European jobs or to pressure to restriction of social right of European workers under the demand of so called competitiveness (and it is not uselessly pessimistic spooking, it is the reality of today again). In addition, such treaty in no way compels the other contracting party to improve social rights of its working people and Europe as a matter of fact makes out a blank cheque to continuation of insensate conditions at goods production in the country that the treaty concluded with – and it is in contradiction with the provision that the European federation should actively endeavour that human rights (including social right naturally) which acknowledges itself to diffuse in other parts of the world as I wrote in my proposal of the European federal constitution. If the future federal Europe should have conscience it cannot solemnly proclaim rights that will respect only home but at the same time, it will not only tolerate but on the contrary support their violation elsewhere and also indirectly allow that they are endangered at home. It is therefore obvious that an international treaty that seemingly has nothing to do with human rights and do not endanger them can in fact both endanger them and give sanction to their violation (abroad or home) and is therefore inconsistent with the constitution as I suggest it. By the way I add – which does directly not concern the suggestion of the European constitution – that the only moral and fair solution is to trade only with them who will respect human rights being in force in Europe but I am conscious that it is utopia in the present neo-liberal capitalism because trade agreements are formally concluded among states but in favour of supranational firms and more or less according to their requirements (because private profit is more important than human rights for them). In any case, it is necessary to think over again what federal Europe we actually want.

The last provision from the subsection dealing with plebiscites about international treaties speaks about accession of the European federation to international organizations including military (or “defense”) associations. These organizations have founding or other agreements regulating their action, they are however not enough detailed so as the joining state can say what in completeness it could expect from the organization and above all, where limits of its obligations towards it will be. Just the limits are concerned here. I added this provision again on the basis of a deterrent example of the present reality. When the Czech Republic in 1999 joined the NATO it was realized in the form of a law passed by the parliament. In the law, apart from poetic formulations, there was only the sentence that the Czech Republic joins the North Atlantic Treaty which text comprising 14 articles was cited; the law mentions no concrete obligations or rights. The Czech Republic (as well as some other east-European states) joined the NATO for (irrational but understandable) fear of Russia. But the army of the Czech Republic works in fact now as auxiliary colonial corps fighting outside Europe for interests of more mighty members of the NATO which has absolutely nothing to do with preparation of defense against Russia (or whomever else). In order that similar development is avoided at the European federation in the future and that it is not forced, by joining some organization (either trade or military or any other), to conform to principles that were not known in advance I deem necessary that accession of the European federation to any international organization, military or not military, has the form of an international treaty with concrete specification what are obligations of the federation to the organization and what rights following membership in the organization emerge from it.

Federal judiciary - constitutional text

Chapter 3 – Judiciary
Article 44 – Federal judicial system
Judicial power of the European Union is vested in the Supreme Court of the Union, federal courts of first degree and federal courts of second degree.

Article 45 – Supreme Court
The Supreme Court of the Union is a supreme judicial body of the Union. It has a seat in the Federal Region of Brussels.

Article 46 – Composition of the Supreme Court
1. The Supreme Court of the Union is composed of the President of the Supreme Court and 18 judges.
2. Every citizen of the Union who completed the age of 40 years and is not older than 70 years with at least 10 years of practice in law of the Union can be elected a judge of the Supreme Court.
3. The House of People of the Assembly of the Union elects six judges of the Supreme Court, the House of States elects six judges, the Council of Chancellors appoints six judges.
4. The term of service of a judge of the Supreme Court is 13 years.
5. Details are stipulated by the law.

Article 47 – Election of the President of the Supreme Court
1. The President of the Supreme Court is elected by citizens of the Union in general, direct and secret elections held in all territory of the Union at the same time and according to the same rules.
2. Every citizen of the Union who reached the age of eighteen years has the right to elect the President of the Supreme Court.
3. Candidates for the President of the Supreme Court have to meet the provisions of paragraph 2 of article 46.
4. Every candidate has to prove itself with approval with his candidature of at least 50 000 citizens from at least three member states or other territories of the Union legitimate to vote to the House of People of the Assembly of the Union.
5. The candidate who obtains the majority of votes of citizens and at the same time the majority of votes of states is elected the President of the Supreme Court. Result of voting in the member state, the federal territory of the Union or the Federal Region of Brussels counts as the vote of state.
6. If no candidate is elected the procedure advances in accordance with paragraphs 8 and 9 of article 37.
7. Details of the election are stipulated by the law.

Article 48 – Rights and duties of judges of the Supreme Court
1. Nobody is allowed to be a judge of the Supreme Court and to hold any constitutional or other salaried office of the European Union, of any member state or its autonomous entity or of any other territory of the Union.
2. A judge of the Supreme Court is obliged to refrain from all action that could degrade his dignity and trust in impartiality and independence of the Supreme Court.
3. A judge of the Supreme Court may not be prosecuted, restricted in his free movement or arrested unless caught while committing a criminal act.
4. Judges of the Supreme Court receive a salary paid from means of the Union. To receive other remunerations is inadmissible.
5. The mandate of a judge of the Supreme Court becomes effective by his appointment. The mandate of the President of the Supreme Court becomes effective by his election.
6. Every judge of the Supreme Court takes the oath at his first attendance in the plenum. The oath of a judge of the Supreme Court reads: “I, … (name of a person), solemnly pledge now to defend inviolability of rights of citizens of the Union emerging from nature of the man and from laws of the Union in compliance with my conscience and to fulfill the spirit of the constitution of the Union.”
7. The mandate of a judge of the Supreme Court expires by
(a) expiration of the term of mandate,
(b) refusing to take the oath or taking the oath with reservations,
(c) resignation,
(d) death,
(e) exercise of an incompatible function,
(f) sentence for a deliberate offence.
8. The law stipulates details of rights and duties of judges of the Supreme Court.

Article 49 – Powers of the Supreme Court in first instance
The Supreme Court is a court in first instance for
a) controversies between the Union and the member states,
b) controversies between the Union and the associated states,
c) controversies between the member states,
d) controversies between components of the state power of the Union specified in this constitution,
e) considering conformity of laws of the Union, of decisions of the Council of Chancellors and of constitutions and laws of the member states and other territories of the Union with the constitution of the Union.

Article 50 – Other powers of the Supreme Court
The Supreme Court further
a) is an appellate instance for federal courts of second degree,
b) hears constitutional complaints again violation of the rights given by the constitution of the Union,
c) hears disputes concerning jurisdiction between courts of the Union and courts of the member states and other territories of the Union.

Article 51 – Decision-making
1. The Supreme Courts decides in the plenum about the issues enumerated in article 49. At least 14 votes of judges are necessary to pronounce a judgment.
2. The Supreme Court decides in collegia with three judges about the issues enumerated in article 50. At least two votes of judges are necessary to pronounce a judgment. The President of the Supreme Court is not a part of any collegium.
3. Hearing cases is either non-public or public. The President of the Supreme Court decides about public hearing in the plenum, a president of a collegium decides about public hearing in a collegium unless the President of the Supreme Court decides otherwise.
4. Every judge is entitled to make proposals and obliged to vote for one of submitted proposals in the body in which he decides.
5. Judgments of the Supreme Court are pronounced publicly.
6. Every judge has the right to attach his dissenting opinion with justification to a judgment.
7. Details about proceedings in the Supreme Courts are stipulated by the law.

Article 52 – President of the Supreme Court
1. The President of the Supreme Court
a) represents the Supreme Court externally;
b) presides over sessions and voting of the plenum; opens discussions and voting; his vote has the weight of two votes; charges a concrete judge to write a decision after voting;
c) assigns judges to collegia and appoints presidents of collegia; a judge cannot be transferred to another collegium in the course of hearing a case;
d) draws up a work plan for the Supreme Court and its individual parts for a certain period not shorter than two weeks; he can at his discretion commit a case belonging to a collegium to a decision of the plenum;
e) performs administration of the Supreme Court, engages employees for that purpose and determines their job content; assistants of judges have to meet the condition of education in the sphere of law of the Union; the law stipulates details.
2. In his absence, the President of the Supreme Court charge another judge of the Supreme Court with exercising his powers except of the right to vote.
3. Unless otherwise stipulated all provisions referring to other judges of the Supreme Court apply to the President of the Supreme Court.

Article 53 – Federal courts of first degree
1. The federal courts of first degree are courts of first instance authorized for all issues emerging from law of the Union and activities of state administration authorities of the Union.
2. The law stipulates seats of federal courts of first degree, territorial districts of their jurisdiction and details about their work.
3. Every federal court of first degree has departments:
a) commercial for matters following from commercial and financial law,
b) civil and criminal law for matters following from civil procedure law, copyright and criminal law,
c) labour and social for matters following from labour and social law,
d) administrative for matters following from administrative law.
At least one judge is assigned to each department. Judges decide as single judges.
4. Judges of federal courts of first degree are elected by the House of People of the Assembly of the Union. Every citizen of the Union who reached the age of 35 years with at least eight years of practice in law of the Union can be elected judge.
5. The provisions of article 48 apply to judges of federal courts of first degree.

Article 54 – Federal courts of second degree
1. The federal courts of second degree are appellate courts for matters heard at federal courts of first degree.
2. The law stipulates seats of federal courts of second degree, territorial districts of their jurisdiction and details about their work.
3. Every federal court of second degree has a department
a) commercial for matters following from commercial and financial law,
b) civil and criminal law for matters following from civil procedure law, copyright and criminal law,
c) labour and social for matters following from labour and social law,
d) administrative for matters following from administrative law.
At least three judges are assigned to each department. At least two votes of judges are necessary to pronounce a judgment.
4. Judges of federal courts of second degree are elected by the House of States of the Assembly of the Union. Every citizen of the Union who reached the age of 35 years with at least eight years of practice in law of the Union can be elected judge.
5. The provisions of article 48 apply to judges of federal courts of second degree.

Lower federal courts

Whereas relevant constitutions usually write in details about a peak of the judicial system, existence of courts of lower degrees is often only briefly mentioned and all rules administering their function are pushed aside into ordinary laws. I do not want to expand on function of lower federal courts into the same details as about the Supreme Court in the proposal of the European federal constitution, yet the constitutional text should in my opinion determine at least the most elemental frame rules for the lower federal courts.

The principal judicial activity should take place at courts of the lowest degree, in other words at courts of first instance. Just at the first reference to them I face a question how the courts of first instance should be called (although it is not the most important thing). This degree of the judicial system is called district courts in the United States, which is a fitting name. I am however not inclined to rash copying, so I simply chose an appellation “federal courts of first degree”. Analogically, I gave the title of “federal courts of second degree” to the second level of the judicial system with appellate function (called courts of appeals in the United States).

As for a number of courts of the first and second degree, I cannot say anything concrete. Territorial extent of districts of respective courts and so also a number of inhabitants coming under jurisdiction of the respective court may be different and a total number of courts will depend on it. It is no other way but to leave it to an independent law.

I want also to leave rules about function of federal court of first and second degree to a different law but I regard as necessary that the constitution mentions their basic internal structure.  Because the federal courts of first degree should, according to my suggestion, deal with all affairs resulting from federal law it is necessary to reserve specialized judges or departments for certain spheres of affairs at each court. According to the competencies of the federation as suggested by me earlier, four departments at each federal court of first and second degree seem the most appropriate to me: a) commercial, b) civil and criminal, c) labour and social, d) administrative. Existence of some departments is understandable, a few words are necessary at some of them. There is not necessary to explain the commercial department for cases proceeding from commercial law as well as administrative department for matters of administrative law resulting from function of federal authorities. The labour and social department can awaken some questions, it is however based on that I left the labour law on federal level in the section about powers of the European federation and I determined co-operation of the federation and the member states in matters of health service and old age security in the social sphere ibidem. The most strange may seem why I assigned the civil and criminal department to every federal court. Who goes through powers of the federation that I described earlier finds out that matters coming under the civil and criminal law are not listed among competencies of the federation (that is they remain in competence of the member states). Yet there are some circumstances that force to use these spheres of law also on the federal level. As for criminal law, it is necessary to take criminal acts against authorities of the federation, property of the federation, currency of the federation and the like into account; after all, it is appropriate to remark that there is a federal criminal court in the Swiss federation. As far as civil law is concerned, some branches of it belonging under the power of the federation according to my suggestion are elements of it, namely it is a part of public law – civil procedure law (regulating actions at federal courts) and a part of private law – copyright law (other parts of intellectual property law would join commercial law and commercial departments of federal courts would apply them). There is unimportant to enumerate here other branches of law which can be applied in connection with powers of the European federation because they come under the Supreme Court of the federation in the first instance in my suggestion.

A thing of a number of judges assigned to individual departments and a number of judges adjudicating one thing naturally follows. It is usual that single judge decrees at courts of first instance which follows that every department of a federal court should have at least one judge. A federal court of the first degree so has to have at least four judges. It is however usual that judges decree in collegia (panels etc.) at appellate courts. If a number of three judges is wholly sufficient in one collegium, then every federal court of second degree would have at least twelve judges. A way of decision-making is in my suggestion this: through single judges at the courts of first degree, through collegia with three judges and with majority of two votes at the courts of second degree.

I did not mention a significant question yet who should appoint judges of federal courts of first and second degree. I entrusted appointment (election) to the Assembly of the Union (federal parliament) as in the case of the Supreme Court. Because the Assembly of the Union has two chambers in my suggestion, each of these chambers will vote judges of other level of the judicial system. Distribution of election between them is relatively simple – it can be assumed that a number of judges in the first degree will be greater due greater number of courts of this level in the judicial system than a number of appellate judges; therefore election of greater number of judges should be entrusted to greater of both chambers of the European federal parliament, namely the House of People and election of appellate judges thus remains at the House of States. Minimal requirements for judges is related to election of them. Unlike judges of the Supreme Court, lower age and shorter practice in federal law should suffice to judges of lower federal courts – namely a minimal age of 35 years and eight years of practice in Union's law.

Writing about the Supreme Court of the Union I did not mention delimitation of judge's mandate and his rights and duties. I believe that the same rules should be valid for all federal judges of the European Union regardless court level, so I write about them only now.

On principle, I took over the respective provisions concerning deputies of the Assembly of Union and members of the Council of Chancellors as I had them described earlier also for judges of federal courts making some smaller amendments or supplements required by substance of the thing. One provision was added by me in provisions about rights and duties which says that a judge is obliged to refrain from action that could debase his dignity or arouse doubts about impartiality of decision of the court of what he is a member. I modified also an oath of judges to a hearing: “I, … (name of a person), solemnly pledge now to protect inviolability of rights of the people of the European Union arising from nature of the man and from laws of the Union in compliance with my conscience and to fulfill the spirit of the constitution of the Union.” I hope that it is evident that nature of the man is meant natural law. Then, I gave condemnation for a deliberate criminal offence, not only imprisonment as in the case of deputies of the federal parliament or members of the Council of Chancellors as one of conditions for termination of a judge's mandate.

Powers and organization of the Supreme Court

I suggested already what functions the Supreme Court of the federation should have in an earlier post about overall form of the judicial system of the European federation, now I will synopticly summarize it, will deal also with organization of court's work and add powers of the president of the Supreme Court to it as I wrote above in the previous post.

Powers of the Supreme Court were basically given by me earlier, so I will namely put them into two groups; other will follow. The powers closely related to the constitution will be in the first group, namely resolving conflicts between the federation and the member states, conflicts among highest bodies of the federation's state power, also conflicts between the federation and the associated states (mentioned earlier), conflicts among the member states and finally adjudicating conformity of laws of the Union and of decrees of the Council of Chancellors as well as of constitutions, laws and other directives of the member states with the constitution of the Union.

The second group will include competencies following from position of the Supreme Court as a supreme member of the federal judicial system, namely hearing appeals from federal courts of second degree, constitutional complaints of citizens about violation of rights given by the constitution and also – which I have not mentioned earlier – conflicts about competency of court between the Union and the member states.

The mentioned division of the Supreme Court's competencies in two groups has its function not only in differentiation between constitutional and non-constitutional matters but also in a way of their hearing. The first group of matters – because of their significance – must be heard in the plenum of all 19 judges, collegia of three judges then suffice for matters of the second group. A question of majorities necessary to adopt a decision follows. It is simple at hearing cases in collegia – if there are three judges and unanimity is not required, votes of two judges are an only possible majority. I consider the same majority of two thirds of votes to be appropriate for a plenum vote (if the plenum hears more significant cases, why it should have a smaller majority?), that is concretely 14 votes (why not 13 I explain below). I do not suppose that it is necessary to determine a quorum, mentioned majorities should be valid in whatever number of present judges which means in practice the less judges are present the more unanimous their opinion must be.

There is another question whether proceedings should be public or non-public. I suppose that it is not necessary that they are public but I leave a decision to the judges themselves, concretely at the President of the Supreme Court when a case is heard in the plenum and at the chairman of a collegium if a case is heard in a collegium. To pronounce a verdict is however something else, it has to be pronounced publicly.

The last two provisions which I decided to insert in this section relate to a procedure of judges. According to the first of them, every judge has the right to suggest own proposal at hearing a case and then the obligation to vote for one of all suggested proposals – it makes to abstain from voting impossible. The second provision gives the right to attach their dissenting opinion to the judgment to the judges who disagree with a result of a voting; this should be valid for hearing cases either in the plenum and in collegia.

Now I move to provisions about the President of the Supreme Court. I wrote in the previous post that the President should be an only judge of the Supreme Court elected directly by citizens and his (her) exceptional position in the Supreme Court should be in accordance with it. Organizational powers are naturally above all the point; I tried to determine them in a way that the president has an influence on direction and decision-making of the court though he cannot get round voting of other judges.

That the president will represent the Supreme Court externally is self-evident so I immediately go over to other competencies and they concern hearing in the plenum. The president of the court should have the right to call a session of the plenum, to chair it, to open discussion and to vote as the first and to charge a concrete judge with writing a decision after voting. Because he should not be a member of any collegium he can vote only in the plenum. Here I asked myself a question whether to moderate discussion and to vote in the plenum is a sufficient possibility to influence the court's direction of opinion. Although I will mention more other administrative powers of the president of the court I reached the conclusion that it itself cannot be a sufficient expression of the president of the court's exceptionality against other judges and that I can dare to assign two votes to him at voting – it is not too exaggerated, the president alone this way cannot outvote other judges, it however symbolicly reflects that he unlike other judges was established in his office directly by the people. Then a majority of minimally 14 votes instead of 13 for pronouncing a judgment in the plenum follows from it as I have mentioned above.

Other competencies of the President of the Supreme Court relate to filling the collegia; he should have the right to place the judges to individual collegia and to determine their chairmen in my suggestion. I determined however one restriction so as the president of the court cannot arbitrarily manipulate with things being heard through transferring judges; this should be prevented with a provision that a judge cannot be transferred to another collegium in the time in which he considers a case but only after pronouncing a judgment. I also leave in the president's hands to determine a work plan of the plenum and the collegia, with a condition that it will not be for a period shorter than two weeks. I added one more to powers of the President of the Supreme Court over the collegia, namely a power at discretion to commit a case belonging to a collegium to plenum's hearing. The president's last administrative competence in my suggestion then is to manage ordinary operation of the Supreme Court, to engage employees and determine their job content; a condition was added by me here that employees assigned as judges' assistants must be educated in law of the Union (with detail stipulated by the law).

A question of temporary replacement of the President of the Supreme Court remains. There is no permanent Vice-President of the court in my proposal. By that reason, I added a provision that the president of the court can entrust anyone else judge with execution of his powers in the time of his absence but with one exception, namely the right to vote. As I have already written two votes of the President of the Supreme Court are expression of that he has unlike other judges direct support of citizens, no other judge should therefore have these two votes at his disposal. But there is a question whether the president of the court would schedule a plenum voting for a time of his absence.

I have no other special power for the president, so a statement remains that – except as above stated – all provisions concerning other judges (including matters about which I have not written yet) should relate to the court's president too.

Rules regulating election of the President of the Supreme Court naturally cannot be absent among other provisions concerning him (her). I believe that it is not necessary to invent anything new and that provisions regulating election of the Council of Chancellors (see here) should be used here, that is to say the majority system of two rounds with a requirement of double majority. The only two differences are in requirements for candidates and in number of citizens requisite to enroll a candidate. A candidate for the President of the Supreme Court has to meet criteria for other judges of this court, it is to say age of 40-70 years and activity in law of the Union of at least 10 years. As number of supporting citizens is concerned I decreased it against the corresponding number at election of the Council of Chancellors because experts of law discipline have smaller chance to obtain broader people's support than representatives of executive public functions. So my numbers are in this case 50 000 supporting citizens (a half of the number required to support  candidates for the Council of Chancellors) from at least three member states (or other members of the federation).