A European North-South Dialog

Flatworld, a blog run by conservative German daily Die Welt‘s international-news department manager, published an open letter on Sunday – in German, Greek, and Italian so far -; an open letter, that is, to European readers from or in the countries which are currently in financial and structural crisis. The open letter isn’t available in English, but there is an English-language thread, and the comments there may give you an idea of the issues discussed in the open letter itself.

Don't mention the budget

The insecure (European) sovereign: finding his voice?

The thread is meant to provide a platform for a “pan-European” public, but some input from outside Europe may also be welcome there. But even just reading there may give you an idea about how the European base – rather than its superstructure -, may be ticking.

German, Greek, and Irish readers seem to have commented so far.

7 Comments to “A European North-South Dialog”

  1. Clemens Wergin seems to understand what is needed. I like his approach. I missed the German version and if you did not mention it here I would still wonder why he writes in Greek. TNX


  2. I think Wergin left out many aspects which would have mattered, too, Neru, but I agree that an open letter by a major German daily is a great idea. The messages there, both from the North and the South, don’t look too encouraging, but I’m hopeful that it is usually resentful people who are most inclined to comment on posts like Wergin’s latest. 😉


  3. The only solution to this is the one already being put in place – a bailout coupled with the introduction of a body for unified fiscal governance. Greece, Italy, Portugal and the rest will simply have to drink their bitter medicine. If they do not like it, then they can see how well they prosper without assistance.

    Margaret Thatcher was right about the Euro, wasn’t she?


  4. Depends on what she said about the Euro, Foarp. As far as I can remember, her conflict with M Delors, for example, was exactly about the political powers that should never be in the hands of the European commission. Unified fiscal governance, eh? 😉

    Btw, I agree with you about the need for European fiscal governance. Just not sure that the former prime minister would.


  5. Quoting the Telegraph on Thatcher is rather like quoting the Vatican about the Pope, but this is what she said:

    “Today, Margaret Thatcher’s autobiography, first published in 1993, reads like a prophecy. It shows how deeply and with what extraordinary wisdom she had examined Delors’ proposals for the single currency. Her overriding objection was not ill-considered or xenophobic, as subsequent critics have repeatedly claimed.

    They were economic. Right back in 1990, Mrs Thatcher foresaw with painful clarity the devastation it was bound to cause. Her autobiography records how she warned John Major, her euro-friendly chancellor of the exchequer, that the single currency could not accommodate both industrial powerhouses such as Germany and smaller countries such as Greece. Germany, forecast Thatcher, would be phobic about inflation, while the euro would prove fatal to the poorer countries because it would “devastate their inefficient economies”.”

    And here’s Rory Leishmann in the Canadian press making the same point:

    “Speaking to the Commons in 1990, Thatcher foresaw that eventually there would have to be enormous transfers of money from one country to another to sustain the euro. Again, she was right. To stave off default by Greece and to reassure bankers about the financial stability of Italy, Portugal and Spain, the European Union and the International Monetary Fund have come up with a $900-billion plan to defend the euro at the expense mainly of taxpayers in France, Germany and the United States.

    Furthermore, as Thatcher and Krugman also predicted, the German and French governments are now calling for much tougher centralized controls to prevent any more members of the euro-zone from running up unsustainable budget deficits. Meanwhile, the Greek government is struggling with savage spending cuts imposed by the EU and IMF as a condition for bailout assistance.

    In February, Greece already had an unemployment rate of 12.1%. That proportion is bound to go much higher as the governments spending cutbacks take effect.

    This, too, is as Thatcher predicted: If we have a single currency, the differences come out substantially in unemployment or vast movements of people from one country to another, she said. Many people who talk about a single currency have never considered its full implications.

    Quite so. Now Krugman predicts that for Greece, not even a $900-billion bailout will suffice. To revive economic growth and curb unemployment, the Greek government will soon be compelled to abandon the euro and re-establish its own hugely devalued national currency.

    Will Italy, Portugal and Spain be next? That remains to be seen.

    Meanwhile, given the international economic and financial turmoil brought on by the euro crisis, it’s evident that every major industrialized and trading country in the world is paying a huge price for the failure of EU leaders to heed the timely warnings by Thatcher, Krugman and others about the disastrous consequences of the euro.”

    Myself, I don’t think that Greece will exit the Euro. Rather, Mr. van Rumpuy’s new “true European economic government” shows the way – as was always likely.


  6. No question – Thatcher foresaw a transfer union, Foarp. That is, in fact, what the Eurozone has been so far, too – it’s just getting much more, umm, intense now. It’s a thing that you may either want, or that you may not want. Thatcher, for sure, was opposed to it. Contrary to many commenters on the Flatworld thread, I’m not opposed to a transfer union – I just want our government to put its cards on the table, and to account to the German public. It would be easy enough to do, because the opposition hasn’t used our worries to chum up to skeptics and to oppose a European approach, just to profit from the current crisis – quite the contrary. If the German government decided to take further steps to help Greece in a European way, both the Social Dems and the Greens would be supportive.
    A transfer union was exactly what pro-Europeans had in mind. They made no secret of it. If the Eurozone could have been sold with a trans-Eurozone watchdog, it would have happened early during the last decade.

    Over at flatworld, you wrote

    If I am ‘glowing’ it is merely from the knowledge that the same people who spent years criticising the ‘backwardness’ and ‘nationalism’ of British voters who opposed entry into the Euro are now in trouble over the inevitable problems that have come from having a single currency without unified fiscal governance.

    That’s somewhat in the same line as “Thatcher was right”. What is true that we are in crisis, and that – as you say yourself – there need to be European answers to that crisis. But to be frank, many of the nationalist British voters were and are backward indeed, as they have always viewed the Eurozone as some kind of scheme against their country, and economic reservations were hardly the core issue for most of them. I feel no resentment about that – such feelings were inevitable, and probably understandable, given the war memories. But the current crisis would (at best or at worst) vindicate some of the critics, possibly including Mrs Thatcher, and if things will really be as messy as many opponents to more European integration are suggesting now remains to be seen.

    Just during the past few months, the Economist has dedicated several articles to the issue about how to “re-industrialize” Britain. September 2011 may indeed herald the end of the European idea. But it may also turn out to be just an unpleasant snapshot. The coming months, and possibly years, will show.


  7. @JR – The problem is that it is hard to fault people for opposing a plan that would reduce their country’s sovereignty if that was indeed the case. Whether or not the deception was intentional, it was the end-result that was opposed, not the means by which it was to be brought about.

    Yes, I remember working on a factory line back in ’96 with workers who compared John Major to Neville Chamberlain, saying that we should not trust the ‘Europeans’ (by which what was meant was the Germans), and most forthrightly opposed to the Euro, seeing it as a conspiracy for a ‘European’ takeover. Such a conspiracy never existed, but the people who opposed the Euro did so because they perceived, rightly, that it would result in the reduction of national sovereignty – they were simply wildly wrong about the people who were proposing it.


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