The various tactics used by the ECB to bail out failing Euro nations all amount to the same thing – transfers of wealth from German taxpayers to bankrupt nations in the South.
This is not to play on national stereotypes. Individual Greeks may work as hard as individual Germans. Their elected leaders, however, have followed unsustainable policies. Greece did not go bankrupt through random chance – nor Italy, nor Spain.
Corrupt, bloated and inefficient, its public administration has come to a standstill; tax officers no longer able to receive bribes or kickbacks have simply stopped working.
German leaders did their proper job of balancing the national budget, curtailing social spending, fighting inflation, raising the retirement age, raising tax revenue, and stimulating industrial production. Now, the EU is asking Germany to shoulder the debt burden accumulated by years of feckless policy elsewhere on the continent. It is simply infeasible, not to mention immoral and illegal.
The Union shall not be liable for or assume the commitments of central governments, regional, local or other public authorities.
The founding treaty specifically forbids sovereign bailouts. Much of the energy exerted by EU and ECB deliberations, since the crisis began, has been in circumventing these provisions. Not only the news media, but official representatives, have branded Germany “selfish” for not pitching in more, and for attaching strict terms about repayment.
Pity Chancellor Merkel. At home, German voters wonder why they must pay to support foreign spending. Abroad, she is reviled for not being more liberal with German money. The correct response would have been “nein, danke,” right from the beginning.
We would stand on the “no bailouts”’ clause and, if these other countries cannot manage an internal devaluation, as Estonia did, then they are welcome to quit the Euro and devalue some other way. The spite could not possibly have been worse, and Germany would be billions ahead.