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Germany Must Decide What the European Union Is For February 16, 2012

Posted by proeconomia in Fiscal policy, Main, Monetary policy, News on Greece, On the crisis, Opinion.
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A solid piece from Bloomberg, worth your morning coffee time. It points to several shortcomings of the way things are being dealt with today and puts some US-realism into the process (which calls for the ECB to take some losses too). Read it through. Here are some interesting excerpts:

“Today one wonders, what did Germany think “political union,” which it both argued for and proclaimed, ever meant? Germany pressed harder than anybody for the end of the nation- state in Europe, yet its policy is guided now by the conviction that German taxpayers should on no account be asked to support their fellow European citizens in Greece.”

“Moreover, the current policy imposes such ferocious punishment on European citizens in Greece, Ireland, Portugla and Spain that it becomes self-defeating. Certainly, in Greece, government spending was out of control, taxes were not being collected and the public accounts were a joke. But the adjustment now being demanded of it — and the demands never seem to end — is extreme.”

“t’s one thing for Europe’s other governments to demand that Greek politicians do a better job, but quite another to say that the people of Greece — citizens of the post-national Europe that Kohl heralded — should bear the entire burden of their leaders’ incompetence. Doesn’t “political union” imply a bit more borderless solidarity than that?”

and in the end:

“If Germany wants European political union, it needs to recognize its obligations toward EU citizens wherever they live. If it doesn’t want that union, it should stop saying it does.”

The different approaches to the Greek problem from US and UK/European media are sometimes profound…

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