Marshall Auerback on Germany’s choices and the likely outcome.
So whilst many Germans might think they want a smaller, more cohesive euro zone without the troublesome profligates, the policy elites in fact recognize that a “United States of Germany” under the guise of a United States of Europe, actually suits their aspirations to dominate Europe politically and economically. Which is why the outlines of a deal along the lines of increased ECB involved as a quid pro quo for greater German control of fiscal policy across the euro zone, is emerging. It’s the equivalent of the golden rule: “He who has the gold,rules.”
Not a good outcome for Ireland either apparently as he goes on to quote Warren Mosler:-
And the austerity looks likely to not only continue but also to intensify, even as the euro zone has already slipped into recession.
So from what I can see, there’s no chance that the ECB would fund and at the same time mandate the higher deficits needed for a recovery, In which case the only thing that will end the austerity is blood on the streets in sufficient quantity to trigger chaos and a change in governance.” (our emphasis)
At least we will have bought some time to prepare for an exit to our own sovereign currency as described by Pilkington and Mosler.
Note: Feasta is a forum for exchanging ideas. By posting on its site Feasta agrees that the ideas expressed by authors are worthy of consideration. However, there is no one ‘Feasta line’. The views of the article do not necessarily represent the views of all Feasta members.