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Paul Krugman on European Leaders’ Historical Memory

COMMENT: New York Times colum­nist and Nobel-Prize-win­ning econ­o­mist Paul Krug­man weighs in on the think­ing of Euro­pean polit­i­cal lead­ers. (Per­haps one could say Ger­man polit­i­cal lead­er­ship, in that they seem to be call­ing this par­tic­u­lar tune.)

Not­ing that the aus­ter­i­ty pro­grams being pre­scribed for Euro­zone economies in trou­ble are being linked to mem­o­ry of the Ger­man infla­tion of the 1920’s, Krug­man notes that the cur­rent poli­cies of Ger­man and Euro­pean lead­ers mim­ic those of Ger­man Chan­cel­lor Hein­rich Brun­ing [1]. (Brun­ing is pic­tured at right.)

One might note in this con­text that those same aus­ter­i­ty pro­grams are being advo­cat­ed by the GOP and Amer­i­can right wing!

“Euro Zone Death Trip” by Paul Krug­man; The New York Times; 9/26/2011. [2]

EXCERPT: . . . . And I see no sign at all that Euro­pean pol­i­cy elites are ready to rethink their hard-mon­ey-and-aus­ter­i­ty dog­ma.

Part of the prob­lem may be that those pol­i­cy elites have a selec­tive his­tor­i­cal mem­o­ry. They love to talk about the Ger­man infla­tion of the ear­ly 1920s — a sto­ry that, as it hap­pens, has no bear­ing on our cur­rent sit­u­a­tion. Yet they almost nev­er talk about a much more rel­e­vant exam­ple: the poli­cies of Hein­rich Brün­ing, Germany’s chan­cel­lor from 1930 to 1932, whose insis­tence on bal­anc­ing bud­gets and pre­serv­ing the gold stan­dard made the Great Depres­sion even worse in Ger­many than in the rest of Europe — set­ting the stage for you-know-what. . . .