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Germany’s Not that Sorry Anymore


COMMENT: A recent For­eign Pol­i­cy arti­cle ana­lyzes Ger­many’s seem­ing­ly schizoid behav­ior toward bail­ing out the Euro as result­ing from a desire on the part of that coun­try to assert its inde­pen­dence from World War II  guilt.

“Ger­many’s Not that Sor­ry Any­more” by Yascha Mounk; For­eign Pol­i­cy; 10/14/2011.

EXCERPT: With mar­ket con­fi­dence in Greece and Italy fur­ther erod­ing, Ger­many’s cash reserves are now the last best hope for the euro. With­out a bold, con­ti­nen­twide res­cue effort led by Ger­many, the sin­gle cur­ren­cy is like­ly to dis­in­te­grate. Yet it now seems clear, as indeed it should have for the last three years, that Angela Merkel’s gov­ern­ment would rather risk the euro’s col­lapse than act deci­sive­ly.

Ger­many has prof­it­ed might­i­ly from the adop­tion of a com­mon cur­ren­cy. Blessed with a dynam­ic export econ­o­my that does most of its trade with­in the euro­zone, it has gained more than any­one else from the greater ease of doing busi­ness with its neigh­bors. What’s more, even Ger­mans who remain nos­tal­gic for the Deutsche mark should real­ize how cat­a­stroph­ic a col­lapse of the euro would be. The world econ­o­my would fall back into reces­sion. Ger­man exports would shrink pre­cip­i­tous­ly. Ger­man banks, which have large hold­ings of Greek and Ital­ian assets, would require vast sums from tax­pay­ers to sur­vive. Unem­ploy­ment and the nation­al deficit would sky­rock­et. . . .

. . . . Ger­many’s seem­ing will­ing­ness to let the euro crash and burn thus indi­cates that the cur­rent lead­er­ship vast­ly under­es­ti­mates the coun­try’s need for long-term strate­gic part­ners. Ger­man politi­cians of the post­war era were mas­ters at pur­su­ing Ger­many’s self-inter­est even as they talked about noble ideals. Ger­man politi­cians today have naive­ly tak­en their pre­de­ces­sors’ rhetoric at face val­ue. Dis­gust­ed by a sub­mis­sive­ness that nev­er actu­al­ly exist­ed, they have grown deter­mined to be more assertive. As one lead­ing mem­ber of the FDP, the small lib­er­al par­ty that is part of Merkel’s gov­ern­ing coali­tion, insist­ed: “For once, we’ve got to show that we’re capa­ble of say­ing no.” In that spir­it, Ger­many’s lead­ers are talk­ing up a storm about their coun­try’s self-inter­est even as they gam­ble away the eco­nom­ic liveli­hood of their own cit­i­zens.

A trans­formed Ger­many now threat­ens the sta­bil­i­ty of the euro, and indeed the future of the Euro­pean Union itself. But the rea­son is not just that the new Ger­many has grown more self­ish. If Ger­mans were sim­ply act­ing ratio­nal­ly, they would bail out the euro. The prob­lem, rather, is that the lead­ers of the new Ger­many are so mired in an over­re­ac­tion to the past that they have become blind to their own self-inter­est.


2 comments for “Germany’s Not that Sorry Anymore”

  1. Pret­ty sick to see that the Ger­man gov­’t is try­ing to pull this kind of stunt.
    Thanks for the arti­cle, Dave. =)

    Posted by Steven | October 23, 2011, 1:36 am
  2. Not to let Reich 4.0 off the hook, it seems aca­d­e­m­ic to say here that the writ­ers of For­eign Pol­i­cy (and its par­ent, the Wash­ing­ton Post) have a stake in rein­forc­ing the Euro-as-panacea myth. As do most of the euro pow­ers — that is, the ones seek­ing to main­tain and advance the cen­tral­iza­tion of deci­sion-mak­ing pow­er, devolv­ing sov­er­eign­ty, etc. Embar­rass­ing­ly, Greece (its peo­ple, not its banks, nor its banks’ politi­cians) have no need of the myth, some­what like the way Argenti­na gave the fin­ger to the IMF ten years ago. Any small­er nation could do the same, with a polit­i­cal­ly informed and active pop­u­lace. Mere­ly stat­ing that the slow-foot­ed approach Ger­many has under­tak­en, or rais­ing the alarm that a “trans­formed Ger­many” is a new threat seems disin­gen­u­ous (what about the British pound, or the Swiss franc, for exam­ple?). Is it indeed a fact that the Euro’s sta­bil­i­ty or suc­cess is a func­tion of Ger­man sup­port or non-sup­port? If so, Yascha Mounk, then please show your work!

    Posted by Rob Coogan | October 23, 2011, 7:35 am

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