German Resistance To Greek Bailout Disturbing Other Europeans

Over this past weekend, a lot of people were asking me a lot of questions about whether the Germans were “going to” bail out Greece.

Over this past weekend, a lot of people were asking me a lot of questions about whether the Germans were “going to” bail out Greece. Apparently, they hadn’t seen our posts at the END of last week describing how much resentment there was among Germans – based largely on the unhappiness among WEST Germans at how much the “bailout” of the EAST Germans had cost them, throughout the 1990s and into the current century the historical experience / prism thru which they were seeing the Greek bailout.

Over this past weekend, a lot of people were asking me a lot of questions about whether the Germans were “going to” bail out Greece. Apparently, they hadn’t seen our posts at the END of last week describing how much resentment there was among Germans – based largely on the unhappiness among WEST Germans at how much the “bailout” of the EAST Germans had cost them, throughout the 1990s and into the current century the historical experience / prism thru which they were seeing the Greek bailout.

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But, as always, in politics, the German resistance was evoking resentment in the rest of Europe towards them:

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Berlin is pressing too hard, with the region’s new fixation on debt creating a “cult of austerity” that could make it harder to recover from the slump. Drastic budget cuts, if carried out as promised, could set off deflation, send already high unemployment rates surging, bring governments down and even create popular opposition to the euro, critics say.

The pressure “will impose terrible strains on the government and society” for years to come, said Jean-Paul Fitoussi, professor of economics at the Institut d’Études Politiques in Paris. “It’s self-defeating, because if you have austerity and deflation in Greece, Portugal and Spain, then the European economy will not recover; firms will fail and jeopardize the banks.”

Opposition to austerity is spoken softly in official circles, as political leaders fret that markets will punish countries that show weak resolve to reduce debt. But Germany, which has insisted on steep cuts in public spending in the most indebted nations, is facing criticism for harping about the dangers of debt without doing more to support growth, mainly by buying more from its neighbors.

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