As should be clear to any even somewhat regular reader I'm no fan of the Bundesbank and the whole "let them eat austerity" German approach to the euro crisis. It's very destructive and shortsighted.
Sarrazin the German central bank's director till 2010 has written a new book that has not exactly proven popular to most German politicians:
"Europe Doesn't Need the Euro" is the title of the new book by Thilo Sarrazin, a veteran German finance official turned political provocateur and best-selling author, that went on sale Tuesday."
"His tome had German politicians apoplectic even before its publication. Finance Minister Wolfgang Schäuble called it "hair-raising nonsense," while leading opposition politician Peer Steinbrück dismissed Mr. Sarrazin's arguments as "bull—" in a televised debate Monday night."
His reasoning is that Germany loses much more than it gains being in the euro:
"German trade with countries outside the euro zone is growing faster than trade with other euro members, he points out. Constructing a currency union without a political union was folly, he argues."
"Now, Germany is under pressure to accept rescue measures that could increase German debt and inflation, he said."
"If other euro members can't learn German-style discipline, Mr. Sarrazin argues, then they should leave the euro—or Germany should consider doing so."
If you've followed this far you may well be wondering what makes these views especially "viscous?"
It's true that they're pretty standard-I think they're wrong, that he greatly underestimates the benefits of the euro to Germany. However listen to what else was in this book:
"Mr. Sarrazin's most contentious claim in the new book is German politicians, in bailing out other euro members, are failing to defend the national interest because of guilt over the Holocaust and World War II. That led some politicians to accuse him of pandering to German nationalism."
By going here it lets us know just where Mr. Sarrazin is really coming from. And where he is coming from can be seen most clealry from his last book:
"Mr. Sarrazin's previous book was also roundly denounced by German elites, but it became a hit, selling 1.5 million copies. "Germany Is Abolishing Itself," published in 2010, warned that Germans' low birthrates and Muslim immigrants' higher fertility were damaging the quantity and quality of the country's future workforce."
"Germany's political and academic elites accused Mr. Sarrazin of spreading xenophobia and dubious eugenic theories. Mr. Sarrazin resigned from the Bundesbank's board under heavy political pressure."
The idea that someone so high up in such a powerful institution as the Bundesbank served till just 2010 is rather appalling-he left because of the blowback from that book. And this is the Germain tail that is wagging the dog right now in Europe?