So, we are being told, even the Bundesbank is beginning to sound alarmed. Germany is slipping into recession. Demand is down, exports are down, hence production down. And the country’s 0.2% growth in the third quarter of 2012 is expected to turn negative by the end of the year. Alarm!!!!! Not Germany!!!! The other countries can all go hang and self destruct through recession and depression, but not Germany!!!!
Nevertheless, the German leadership seems to have an inbuilt mechanism of denial of the truth. Their precious numbers show them without doubt they are headed for recession. Why? They ask themselves. They have a simple answer. The German leadership adores simple answers… not just simple ones, but facile answers that protect them from the underlying truths they would rather not accept.
So the answer is simple. It is all the fault of the European crisis that has pushed the EU/EZ into recession! In characteristic Shauble logic, it is some one else’s fault. It is always someone else’s fault. Which is how he countered American exhortations to stop with the austerity and stimulate the European economy instead. He told Timothy Geithner it was all the fault of the American sub prime bubble.
And no doubt that was part of the problem. The other part was the reckless lending of the European banks, in particular Deutsche Bank, to take a random example. And when it comes to the recession of the German economy which is important, whereas recession in any other country is not (according to the Schauble mentality), then the fault lies with the other Europeans. Not with Germany.
Does it not even cross their little minds that perhaps, just perhaps, the German insistence on the most stringent austerity ever encountered in peace time imposed on the Eurozone, might, just might have something to do with it? Because apart from the very guilty countries like Greece and even Spain now, what about the virtuous ones like Holland and Austria say?
The Frau, who has not a clue how the economy really works, was at the peak of her power trip when she imposed the maximum deficit clause on the EZ. That is, all EZ members signed up to never, ever allowing their budget deficits to exceed 3% on pain of the most terrible penalties. Now, did no one really think to point out that imposing further penalties on a country with a deficit problem would only increase the deficit? And worse, did not one of the other European (in)dignitaries, think they could perhaps point out, that if there was to be a maximum deficit then there should also be a maximum surplus level imposed?
And if The Frau may be excused for not having a clue how economies work, does that entitle ALL the others who signed this abomination with such servility not to point out that simple fact? That if all countries must have a deficit level of preferably 0.0%, then how is any country going to achieve a surplus if no one will buy any more?
Excess surplus should be recycled into deficit countries, through purchases of their products to stimulate trade. And if Germany thought it was a good idea for her to have ever increasing surpluses which she should horde at the expense of the struggling countries who were made to suffer, does this excuse every other Minister of Finance, every Euro Commissioner from gently pointing out to her, that what she wanted was goofy?
So Germany has not lost demand for her products from the distressed countries alone, not all of which are under bailout conditions, but also from the AAA rated countries of the north who were doing very well before The Frau decided to impose her Nonsense turned Vampire Economics on them too, instead of the reverse.
So after having very successfully bulldozed all her brain waves through a pathetic European so called leadership, whereby the economies of the EZ have been effectively from stifled to strangled to waterboarded, as is the case of Greece, The Frau now wonders why demand for her brilliant produce has dropped. That wasn’t supposed to happen*! She screams. And it is all the fault of the European recession, which, by implication is nothing to do with her!
Does she so conveniently forget the cause of the recession, the flawed, anachronistic economic policy she imposed by jackboot? Or does she really not realise what the heck she has been doing to Europe and hence the global economy? After all, if China is facing a problem it is also because The Frau has successfully ruined her markets in Europe. (The Chinese cheap clothes shops are closing down by the day in Greece, because there is no money left even for cheap clothes.)
Perhaps it is high time we stopped blaming Germany and put the blame squarely where it belongs. First and fore most with the (ir)responsible European Commissioner, Olli Rehn, secondly with the head of the Eurogroup (on his own admission more interested in getting re elected than doing what he should) Jean Claude Juncker and last but not least, on all the other EZ Ministers of Finance and Heads of state or government.
And there is no excuse for their criminal inaction. Aiding and abetting a crime is just as serious, if not more in many instances, than the crime itself.
*”That wasn’t supposed to happen”, was what the bewildered American crack commando troupes wailed when they were ambushed and cut down in Somalia some 20 years ago.