“We must accept finite disappointment, but must never lose infinite hope.” – Martin Luther King Jr.
The energy crisis is upsetting the balance of power in Europe, as we finally have realised that Germany is indeed quite fallible. The country’s moral authority was constantly being unleashed upon Mario Draghi during his time as president of the ECB because of his active monetary policy. Germany’s arrogance went as far as proposing…
On June 2nd Wolfgang Schäuble, President of the German Bundestag and former Minister of Finance of the country decided to pen a piece for the Financial Times where he invokes multiple times the spirit of the great Keynes, quoting him on no less than six occasions!
Proof that the economy is also – and maybe first and foremost – political, German economists are now trying to rewrite history. There are some big names attempting to fiddle with the historical facts, adjusting them to fit their theories, or rather their fears. These ordoliberals, bordering on the fanatical, are warning against hyperinflation…
Do the Germans, who in their overwhelming majority are staunchly opposed to what they call the “Haftungsunion”, also known as transfer union implying that their country pays too much money into Europe, live in a parallel universe? Might the Germans have become populist in that they don’t hesitate to dig up a specious, fallacious, facile…
My intention here is not to fall into caricaturisation or outrage, but Germany is now being governed a bit like Ceausescu’s Romania. Just before being overthrown, he managed to run up a surplus in the way of 9 billion dollars on his country’s balance of payments, just like how Olaf Scholz, the new German Minister…
The German economic miracle has its dark side, demonstrated by a massive budget surplus of 1.2% of GDP – that being 38.2 billion euros in 2017 – that’s causing the country’s infrastructure to tumble, which is now the worst infrastructure of all the rich and industrialised nations. Germany’s disproportionate public saving is causing under-investment within…
The infamous Treaty of Versailles which was imposed on Germany following the First World War forced the nation to pay the astronomical sum of 132 billion Marks. This iniquitous treaty was to provoke the Occupation of the Ruhr in 1923 by France, displeased at the delays in German payments. In 1924 however, the Dawes Plan,…
The narrow-minded attitude of the Germans with regards to austerity, currency and money in general is totally counterproductive in Europe’s current situation. There is nevertheless one certainty: they are sincere! In fact, Germany’s behaviour can only be understood in relation to its at the very least tormented history. Wasn’t bread worth 400 billion marks in…
The staunchly anti-European Martin Feldstein, a Harvard economist, wrote prophetically in 1997 that the introduction of the euro would exacerbate economic cycles by aggravating unemployment in certain member-states. Whose economic problems would contribute to a crisis in confidence in the Union. In fact, those who were convinced that the Union had been suffering a crisis…
What a shame it is that politicians aren’t historians too! And that it is regrettable for all of us that they aren’t looking back to the year 1931 – a tragedy, among other things – in order to draw parallels and precious lessons for today. Let’s remember the bankruptcy of the very large Austrian bank,…
German households and businesses are clearly creditors and in surplus with regards to countries abroad. As for the German government, its objective is to clear its public debt and run a budget surplus. So why would it now trouble itself with the endemic deceleration of the country’s domestic investment, which has been induced directly by…
What European social model? Is there only one, when the Germans are more than ever obsessed with competitiveness and their trade surplus? In reality, Merkel and Schauble’s only solution in order to compete with emerging and developing countries – and therefore to preserve Germany’s market shares – consists of crushing southern European workers under an…
Germany has a huge demographic problem, but not necessarily the one you might suspect. While its population is indeed stable at slightly over 80 million inhabitants, it is the age of the total payroll that threatens to derail the country’s economy. This is because they are dangerously increasing the dependency ratio, that is, the proportion…
Last summer, during a telephone interview with his American counterpart, German Minister for Economic Affairs, Wolfgang Schäuble, thought he was being funny by suggesting that they should swap Puerto Rico (which has nearly gone bankrupt) for Greece! In fact, the overwhelming majority of Germans have been convinced by the narrative which claims that their hard…
The European government elites are sinking into denial. Their frightened posture against public deficits and preference for strict financial orthodoxy is a reflection of an age-old tendency for self-destruction. However, the current version of this tendency is about to lead them to a nasty state of affairs. I am referring to the ascension of extreme-right…
German politicians live and evolve in a parallel universe. Their trade surpluses, their fiscal and restrictive fiscal policies and their anemic domestic investment are all compelling evidence of the “economic autism” of their government elites. Those political leaders incessantly affirm in public the validity of these surpluses as if trying to convince themselves that these…