By Bill Black, the author of The Best Way to Rob a Bank is to Own One and an associate professor of economics and law at the University of Missouri-Kansas City. Cross posted from New Economic Perspectives
It is good to be Angela Merkel. Growth in Germany goes sharply negative in the last quarter of 2012 and press reports emphasize how sound the German economy is because it is a net exporter. This article analyses how the Wall Street Journal and the New York Times presented the news about Germany’s economy. I show that the presentation reveals more about the pathologies of our major media than about the pathologies of Germany and the Eurozone.
The Wall Street Journal article about Germany has one glancing reference to austerity, in the tenth paragraph. The journalists used a power shovel to bury the lead.
Germany’s contraction suggests euro-zone GDP declined for a third straight quarter at the end of last year, and failed to expand for a fifth straight period as fiscal-austerity programs and rising unemployment likely spurred additional output declines in Spain and Italy. A report Tuesday from the European Union’s statistics office showed a euro-zone trade surplus of €11 billion ($14.7 billion) in November, which should limit the expected decline in GDP.
We have a grudging admission that the story in Europe is austerity, which has thrown most of the continent back into a second recession. The article mushes causality by implying that unemployment is a separate cause of the recession unrelated to austerity. The reality is that austerity drives reduced demand, which reduces output, which reduces growth (and can turn it negative), which reduces employment, which increases inequality, emigration, and budget deficits.
Berlin’s insistence on inflicting austerity on the Eurozone has produced five quarters of no growth or negative Eurozone growth. Spain, Italy, and Greece have Great Depression levels of unemployment – and unemployment is rising.
The WSJ journalists tried to impart a positive spin on the catastrophic effects of austerity by talking about the Eurozone trade surplus. The surplus is larger than expected, so the actual decline in Eurozone GDP may be less than the “expected decline in GDP” due to austerity. Yes, Berlin knew that inflicting austerity would throw the Eurozone into recession when Berlin insisted that the Eurozone embrace austerity. (Be cautious about whether the Eurozone’s actual loss of GDP will be less than projected. Germany’s preliminary estimate is that its GDP fall in the last quarter of 2012 was far greater than expected, and the German economy is the largest Eurozone economy.)
Why German Austerians are Praying That Obama does Not Inflict Austerity
But there are broader problems that the WSJ journalists (implicitly) report, but do not explain.
The downturn should be short-lived, analysts said. Key export markets such as the U.S. and China are starting to pick up, while improved sentiment surrounding Europe’s three-year-old debt crisis is expected to spur a recovery in the euro zone this year.
Again, note the positive spin. The journalists do not claim that German exports will surge in 2013 primarily through increased sales to Eurozone customers due to austerity producing a strong recovery in the Eurozone. Germany’s leading trade partners are the Eurozone nations, but the journalists report accurately that Germany’s hopes for recovery rest on “the U.S. and China” because both nations have demonstrated continuous growth through stimulus. Germany hopes that the U.S. and Chinese economies will act like tow trucks and pull Germany out of an incipient recession. Germany’s only realistic hope for avoiding a recession (two consecutive quarters of negative growth) rests with the two Nations that most famously used stimulus to respond to the Great Recession. Stronger growth in the U.S. and China leads to increased demand for German exports. The great irony is that German austerians are praying fervently that the U.S. not adopt austerity.
Note also that the hope for Eurozone recovery does not come from austerity, but from “improved sentiment.” Austerity has harmed consumer sentiment. The great improvement is that the ECB (finally) jawboned the financial markets into believing that it would prevent the bond vigilantes from taking down any Eurozone member. It was the dramatic expansion of ECB governmental intervention in the bond markets, in order to preserve the ability of Eurozone nations to borrow and spend that caused the large fall in sovereign debt yields. The ECB’s quasi-guarantee massively expanded the ECB’s potential liabilities. It was the ECB’s anti-austerity policies that improved “sentiment.”
Germany’s export-based strategy cannot work for the world. We cannot all be net exporters. Indeed, the more that Germany exports the harder it is for other nations to export their way out of recession. The journalists also fail to note the tremendous loss that the German export strategy imposes on German workers. Unemployment is low, but German workers’ wages have been reduced materially in real terms as productivity has grown. The result is very large corporate profits and ever higher inequality.
The New York Times’ article about the Germany’s negative economic growth mentions austerity several times, but its analytics are often incoherent.
Throughout the European debt crisis Germany has managed to float above the bad news, enjoying record employment, rock-bottom borrowing costs and export-led growth that kept chugging in spite of the cloud hanging over the euro zone. But Germany’s European partners are also among its biggest customers, leaving it vulnerable to the Continent-wide slowdown made worse by the very austerity policies championed by Chancellor Angela Merkel.
This paragraph ignores the effect of austerity on German workers. The NYT journalist informs the reader that Berlin’s insistence on inflicting austerity on the Eurozone has “made worse” “the Continent-wide slowdown,” which has had the ironic effect of harming Germany. The human cost of the gratuitous recession that Berlin is inflicting on Europeans is hidden by the journalist’s framing of the crisis as a mere “slowdown” and describing it as a “cloud.” Europe’s second recession, the Merkel recession, was made in Berlin. The NYT journalist reverses the facts in these three paragraphs.
“Within the region, Germany has served as a crucial counterweight to the struggling economies of Southern Europe, and helped to stabilize the euro zone as a whole.
The country’s economic might has also given Ms. Merkel an especially strong say in euro zone policy. Her clout and insistence on fiscal austerity in return for German financial support has often irked other leaders, but it has made her popular at home. She is an overwhelming favorite to win a third term in nationwide voting in September.
“Most of the decline can be blamed on weakness in the rest of Europe,” said Martin Lueck, an economist at UBS in Frankfurt. “Voters will not blame it on Ms. Merkel.”
The first paragraph takes Merkel’s propaganda and makes it a statement of “facts” that are so unassailable that they require neither reasoning nor citation. The actual facts are, as the article admitted in the first paragraph, that Berlin demanded the policies that took the “struggling economies of Southern Europe” and threw them into Great Depression levels of unemployment that are causing their university graduates to emigrate in droves. Berlin did not “stabilize the euro zone as a whole” – it threw it into recession. In so doing, it did not help ordinary Germans. German growth would have been far more robust but for their own austerity. It is no coincidence that German growth went sharply negative as soon as it balanced its budget. The NYT author, of course, spins this as another positive :
And the German government achieved a budget surplus for the first time since 2007, without having to impose the kind of austerity that has choked growth in France, Britain or Italy.
Note the journalist’s incoherence. She concedes that it was Berlin’s “insistence” that forced the nations of the Eurozone to inflict austerity on their people and economies and she concedes that it was austerity that “choked growth” in the Eurozone and forced it into a recession. Only paragraphs before, however, she claimed as fact this pearl of Prussian propaganda: “Within the region, Germany has served as a crucial counterweight to the struggling economies of Southern Europe, and helped to stabilize the euro zone as a whole.” I have heard IMF economists call austerity policies that are certain to cause recessions “stabiliz[ation]” but I expect unintended self-parody from that source. To be clear, Berlin’s insistence on austerity is not a “counter-weight” to the periphery’s problems – it is the backbreaking weight Berlin has forced on the necks of Europeans that has brought misery to tens of millions of Europeans for no positive purpose. A recession does not “stabilize” an economy.
Merkel’s austerity policies were once unpopular among many Germans, but the sad paradox is that the euro, whose proponents claimed it would lead to “ever closer union,” is now the single greatest threat to European unity. As the peoples of the European periphery have been pushed into far more strident ideological and ethnic divisions by austerity and depression-level unemployment they have often directed their ire at Berlin. The dominant German meme spread by Merkel’s party is that the virtuous Germans have selflessly bailed out the profligate South and received scorn in return. Only Prussian discipline can save southern Europeans from themselves. Merkel’s popularity has surged as this meme of the slothful peripheral ingrates engaged in Berlin-bashing has become dominant in Germany. The NYT article captures the political implications of this meme nicely in predicting the likely German reaction to Germany’s sharply negative “growth” in the last quarter of 2012.
“Most of the decline [in GDP] can be blamed on weakness in the rest of Europe,” said Martin Lueck, an economist at UBS in Frankfurt. “Voters will not blame it on Ms. Merkel.”
Lueck is probably correct about the voters. The obvious point, except to Germans and the NYT journalist, is that it was Berlin’s insistence on “bleeding the patient” (austerity) that caused much of the “weakness in the rest of Europe.” German voters will not blame Prime Minister Merkel for imposing self-destructive austerity on the Eurozone. They will not blame her for causing millions of people to be unemployed. They will not blame her for making one of the standard things an Irish, Italian, or Greek university student does upon graduation is to emigrate.
Only German voters can hold Merkel accountable unless the sovereign nations that are EU members rise and take back control of the EU and the ECB from the European hyper-power – Germany. It took a decade for the full scale of the Latin American rage against the “Washington Consensus” to be felt in the form of electing a dozen national leaders dedicated to ending that failed neo-liberal regime (austerity was its first principle). If the Berlin Consensus continues to be inflicted on the periphery the results are likely to be similar. Indeed, a delegation of Latin American heads of state recently sought to convince the extremely conservative leaders of Spain and Portugal to learn from the failure of austerity in Latin America. Ecuador’s President Correa is an economist who wrote his doctoral thesis in part on the failures of austerity. In his discussions with his Spanish and Portuguese counterparts he was able to combine his academic expertise with his real world knowledge gained from having to respond to the crises inflicted by austerity. In the early years of the Washington Consensus, many conservative and moderate Latin American leaders eagerly endorsed the Washington Consensus and austerity. Most of the European periphery is still at that stage, but politicians of the periphery who endorse the Berlin Consensus are increasingly unpopular with their people. The Berlin Consensus will ultimately lead to the election of leaders in the periphery who run on platforms that promise to end the disastrous policies that emerge from failed neo-liberal dogmas such as austerity.
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Great piece.
There is no slower learner (or bigger huckster) than a mainstream reporter who has been asked to analyze the effects of neo-liberal economic policies on regular people in “peripheral” countries.
Merkel will not personally win another term as chancellor – classic NYT ameripomorphization. The CDU/CSU, her party, will propabably have a plurality in the next Bundestag, something like 35% of the seats. Because Steinbrück, the SPD leader, is such a flop, the Greens and SPD combined probably won’t make it to 51%, which is tepid consolation for Merkel. The libertarian FDP, the traditional partner of the CDU, is disintegrating, maybe because certain types of supproters are hurting, maybe because the party leader Rösler is a disaster. It is possible that they may not make it over the 5% threshold necessary for representation in the Bundestag.
After the election in September the CDU will probably be a center/right minority in the Bundestag – the only conservative party surrounded by SPD, Greens, Linke, and maybe even the Piraten, which as libertarian nerd socialists may in fact make it over the 5% threshold thanks to the collapse of the FDP.
Merkel is likely to agree to a Grand Coalition with the SPD, nothing new – she did a decade ago, which will make her Chancellor and Steinbrück Foreign Minister or maybe Finance Minister (again). This result won’t have much of an impact on the situation in Spain et al.
I bet that Black is right about German workers not benefitting from Merkel’s policies as much as one might expect – I am a German worker who, while largely satisfied, wonders why there isn’t more given the fact that the German economy is one of the few in Europe that isn’t a disaster. On the other hand, German non-workers excluding the rich, i.e. retirees, the handicapped, and the unemployable are being held above water by state payments. These are substantial portions of the electorate. In the case of retirees in Eastern Germany, benefits continue to constitute a net transfer from west to east and without them the situation would probably be really dangerous.
From the Newspeak dicctionary:
STABILIZE.- v. To reduce wages.
Spanish daily EL PAIS interviewed German sociologer Ulrich
BECK in barcelona on the occasion of the Spanish
translation of his
latest essay ” A German Europa “, in yesterday’s
international printed edition and he has it about
‘ merkavielisomo ‘ and repentless neoliberalism in Germany:
#Kapitalsums as Spektakel” is the title of a related study
published by Markus Metz en Georg SeeBlen in 2012 Edition
Suhrkamp digital
Bill Sir,
Any one who buys into the notion of ‘fiscal austerity expansion’ is either a buffoon or extreme neoliberal with membership of the global elite.
As someone who has witnessed what fiscal austerity can unleash in the UK, I can assure readers that sentiment about future prospects is low to non existent as witnessed by the collapse of numerous businesses on the UK highstreet and large layoffs in the public sector and large social welfare cuts – obviously, none of this shit has improved the UK’s fiscal deficit, quite the reverse as more and more fall victims to this assault on workers and those in need I’d social welfare.
Indeed, having witnessed Thatcher’s monetarist BS in the early 80’s and the boom and bust of the late 80’s/ early 90’s, notwithstanding all the ups and downs in Asia since 1998, I can only say there really is no where to actually move too that is not suffering at the hands of the neoliberal bastards that are ruining the global economy so a handful of persons can have wealth beyond our wildest dreams.
Obviously, the MSM tries to avoid mention of any reality that may undermine advertising fees from their corporate masters or corporate owners – this applies to Germany, the EU and most states today – no doubt the USA will also adopt austerity in an attempt to further the interests of the elite at the expense of the majority.
Still, for all those who voted for Obama, perhaps you should have voted for Jill Stein, at least she offered some hope, rather than all the austerity crud we are all now forced to eat – A UTTER DISGRACE!!!!!!!!!L!!
Maybe some self-styled progressives and leftists would have voted against Obama one way or another, but maybe they took Noam Chomsky’s advice to vote for Obama to heart and voted for Obama because Noam Chomsky told them to vote for Obama. Here is the story.
http://www.rawstory.com/rs/2012/10/01/noam-chomsky-if-i-were-in-a-swing-state-id-vote-for-obama/
I gather that mentioning the name “Noam Chomsky” wins the passing American tourist all kinds of ‘street cred’ in certain sectors of European society. I wonder if those same sector-loads of European society have even HEARD of Charles Walters Jr. or Butch Swaim or people like that. Is it too cruel to ask whether Noam Chomsky has devolved in a sort of display-leftist Court Jester and what has been called a “Gatekeeper Leftist”?
After all, when the chips were down, he DID tell his fan base to vote for Obama.
Chomsky was a hero of mine, regrettably, many a progressive fell for the lesser of two evils mantra – the result, a Democrat President who’s to the right of Eisenhower, if not Nixon.
Whilst bloody annoyed at Chomsky, Black and many others for imploring voters in the USA to vote Obama in November, this does not distract from the valuable academic work undertaken by them.
however, it would be nice for them to actually apologise for encouraging the electorate to vote for these rascal neoliberals – indeed, they should have supported Ms. Stein regardless of the fact this could have allowed Romney to romp home.
i don’t know Butch Swaim – and searching for him didn’t provide any further infos – any links handy? thank you!
A couple of questions … In the US we have run trillion dollar deficits since 2009.
How many years can we run a trillion dollar deficit until deficit spending is a problem?
How many years of trillion dollar deficits will it take to “fix” our economic problem?
The only things that trillion dollar deficits have achieved are bankster bonuses and the status quo election of politicians.
I, for one, want change I can believe in.
With all due respect, you don’t seem to understand numerators and denominators.
When you cut deficits when the economy is weak, the economy contracts proportionately even more, making debt to GDP ratios worse. This has happened again and again, see Europe (Ireland, Latvia, Spain, Greece, Japan 1997, the US, 1937, and I am sure readers can supply more proof).
The aesthetics may offend you, but cutting deficits now will make debt/GDP worse.
With all due respect … sincerely … spending to prop up a broken system doesn’t fix it. And … no I am not some republican hack trying to starve the beast.
Will austerity fix the problem? Nope. Neither will spending, however. This is the wrong battle. You might as well be arguing abortion or some other wedge issue.
The debt ceiling? Who gives a rats ass. Taxing the rich? Ok. Go for it.
No more wedgies. The system is broken because insiders have diverted attention away from their crimes.
But … but … people will get hurt. My counter … people are already being hurt.
I don’t think it’s so much that it’s “the wrong” emphasis as it’s “the wrong emphasis in isolation.”
Which, as we move further away from “the crisis” and things are normalized, it is increasingly in danger of becoming. And we see this in terms of what people actually attend to.
So, now we get liberals doing their usual knee-jerking “government good” dance, in order to defend the parts of the government they want to defend. We’ll follow their lead and call it “spending.”
But in the process, they’re also effectively legitimizing a bad government, even by their own definitions, and growing its power.
Spending is necessary, but increasingly you cannot completely ignore his arguments, so great has US debt become. It can’t be ignored because the interest payments are slowly strangling the yearly budget.
One way or another, this debt is going to have to be monetised, defaulted on, or else paid off through cuts and taxes. Personally, I suspect a combination of all three will be imposed by succession of ad hoc responses to the crisis.
I don’t care about the WSJ and NYT pieces, but will make a few points about Bill Blacks comments.
First, let us note that those poor southern countries allegedly victimized by Germany are corrupt crony capitalist States much like the USA is, whereas Germany and the other northern European countries are the kind of State that people like Bill Black would like the USA to be.
Second, Germany has not caused the depression in the Southern States + Ireland and Germany has not imposed austerity on those States. The situation is more nuanced, needs to be examined more carefully.
The origin of the depression in the southern States + Ireland is to be found in their own corrupt upper classes and politicians and their really bad policies.
Once this happened, Germany and the other northern countries have rejected a quick solution by spreading the risks to northern States – Germany and the other northern States have rejected debt collectivization.
So, what Germany and the other northern countries have insisted on, or you may say, imposed, is actually a rejection of debt collectivization.
As a consequence, and in order to avoid default in the short term, the Southern States + Ireland have embarked on austerity. What kind of austerity? The kind that hurts their own people.
In addition, the Southern States + Ireland cannot embark on a Keynesian program of deficit spending to erode unemployment and boost internal demand because they are essentially indebted in a foreign currency.
This is the European austerity. It is qualitatively different from class-war austerity in the USA. No lessons to be drawn, it’s a different dynamics.
By the way, it is true that German workers as a class have been severely restricted in enjoying the fruits of the export-driven economic machine. But look, good news, there are plans to change that
http://www.spiegel.de/international/germany/german-trade-unions-demanding-big-pay-increases-after-years-of-restraint-a-876268.html
You might be cynical and think that this is done to increase domestic consumption now that southerners are less well-off, but anyways you should be happy because in your article you express your sadness on the thought of “the effect of austerity on German workers”.
“In addition, the Southern States + Ireland cannot embark on a Keynesian program of deficit spending to erode unemployment and boost internal demand because they are essentially indebted in a foreign currency.”
Is this not the crux of the matter in Europe?
Whereas here, in the land of the free with a sovreign currency, the cry from too many quarters is: “We’re turning into Greece!”
Ruben, you seem to be saying that Keynesian deficit spending would help the south of Europe + Ireland, where they can’t do it, but we shouldn’t do it here, where we can.
Seems to me that we need to erode unemployment and boost internal demand right here in the good ‘ole USA.
Carla, I’m saying that in the land of the free austerity is pure class war, it can be avoided, whereas in Europe the situation is more complicated with several heterogeneous States sharing a foreign currency, so it cann’t be avoided so easily.
So I’m saying yes, you can do it over there, in the land of the free, by all means help yourselves fighting against Austerians, just don’t project the same causality over here to Europe.
Over here the deep issue is debt mutualization (I said debt collectivization in my previous comment) and the spreading of risks, from more corrupt and incompetent Southern States (extreme case is Greece) to cleaner and more competent Northern States.
Leftist American commentators like Bill Black firing cheap shots at Germany and the northern States are backfiring on their own premises.
As offensive as I’d like to find this comment (I’m from Ireland), it is true that ultimately Ireland is a sovereign country and the austerity it choose to inflict on its people can be imposed only by itself.
However, throughout 2010, Germany via the Bundesbank and the ECB imposed enormous political and economic pressure on Ireland to continue to bail out its banks no matter what their circumstances– including Anglo, the most bust bank in the history of humanity. The Irish state was threatened with itself and all Irish companies and citizen being shut out of the world financial system, their assets seized, loans called in, country kicked out of the euro, and of course, their ATMs would stop working.
I would have called their bluff, but the people than run Ireland are soft pudding with pensions to protect, so they chose otherwise. Nevertheless I reserve the right to take exception to your comment.
Under the old Deutschmark, their sacrifices would have been rewarded with a strong Deutschmark with which they could import goods cheaply from abroad. German workers appear to be waking up to the fact that, under the euro, this isn’t happening. I suspect Germany will be the first to go.
I didn’t mean to offend but rather I meant to be as matter-of-factly as you are, to enlighten our brothers from the other side the Atlantic.
What Germany has “imposed” is a NO to debt mutualization and risk spreading, much like the owner of some cash “imposes” his will not to be robbed by keeping his wallet closely attached to his body thereby causing austerity on wannabe robbers.
Austerity is a second order derivative for troubled European States. The real issue here is debt mutualization and risk spreading.
Regarding Ireland and 2010, Germany has refused to bail out broken States and banks using German (+ Netherlands + Finland + Austria) creditworthiness.
Instead Germany/Bundesbank has said to Ireland: if you so much need to bail out your banks do it at your own expense. Now this may have been transmuted into “Germany has forced us to bail out our banks”. Probably that’s for Ireland internal consumption. I am ready to be corrected on this matter, with evidence showing that it was the Bundesbank who came about with the extremely silly idea of bailing out dead Irish banks with a blanket guarantee scheme.
Going back to the land of the free (and similalrly the UK), conservative forces are taking advantage of what’s going on in mainland Europe to promote austerity for their own vile motives, classical class war, classical propaganda and double speak.
Commentators like Bill Black are playing into this conservative narrative by firing cheap shots at Germany, distracting attention from issues that are proper of States that play the game in their own currency.
The origin of the depression in the southern States + Ireland is to be found in their own corrupt upper classes and politicians and their really bad policies.
Absolutely not. Such things just don’t really matter. The only cause of the depression is the Euro suicide pact. At best, such national virtue can just shift the problem to somebody else. Europeans have just rediscovered that insane and innumerate government economic policy (in Europe, the ECB backed by Germany) can create mass unemployment and economic destruction. Whoda thunk it?! Arithmetic is fundamental. All these European “economists” need to be locked in an asylum supervised by Barney the Dinosaur.
Sane economic policy – spending to restore full employment like a Euro-wide JG would benefit Germany. Would improve the real terms of trade for Germany. Would not inflate the Euro. Would be a win-win for everyone, would reduce everyone’s risks. The free lunch provided by not being insane.
This is the European austerity. It is qualitatively different from class-war austerity in the USA. No lessons to be drawn, it’s a different dynamics. No, the only difference is that the class – war is MORE advanced in Europe. The same class-war dynamic, more advanced. There are regional differences in the USA as well, but they mean much less because the USA’s institutions are fundamentally sound and ameliorate problems. Europe’s common economic institutions were imposed during a Dark Age of economic thought and ARE the problem.
Austerity is a second order derivative for troubled European States. The real issue here is debt mutualization and risk spreading.
Uh, no. Precisely backwards. Austerity = unemployment is a zeroth order problem. Lose your job, no money, no eating (if not for those oh so evil European Social Welfare states – keeping the populations and economies of Europe afloat). Absolute Austerity = nobody works = evertbody starves, but this is an impossible dream of the 1%.
“Debt-mutualization and risk-spreading” is a joke problem in today’s Europe. Which is the “second order derivative”. The only conceivable problem is inflation. And inflation, with respect to increases in national debt, is a margin of a margin, interest on the interest kind of thingie. No state in Europe has been overspending. Too little government spending, imposing austerity and unemployment has been the basic problem of Europe since the 70s. If Greece spent wastefully and excessively – this was a boon to the rest of Europe, which has been mired in anti-Keynesian, anti-accounting “economics” for 30-40 years.
Yes, there has to be central control of local spending, or everyone will print money & bonds like mad, spreading the risk of mutualized debt. But the problem is that everyone knows this, is obsessed by it. Is obsessed by the fear of drowning, while they are dying of thirst in a desert.
Great article except for the fact that the author seems to be seriously challenged when it comes to facts and figures. German wages are up 3,2% annually, workers share of GDP is on the rise since 2009 and unemployment is at record low levels in Germany. Even the real estate prices are up! And not only because rich Greeks are buying. Considering the fact that real GDP growth potential in Germany is about 1% according to OECD, Germany is having some of the best times of the last decades. Germany is still hypercompetitive mainly thanks to low Euro exchange rates. German products are the favourite toys of plutocrats all over the world particuarly in China and the US. Why should Merkel send more money to the Club Med? So that they can spend it on heating oil and cheap stuff made in China? What could possibly be the benefit for German workers?
sounds a lot like…Apple….
and what is the relative size of the private economy in Germany again?
The responses of the Germany defenders sound like Naked Capitalism has been invaded by writers from the Onion.
Rather than engage with their fantasies, I will just say that Europe’s problems are not North-South but 1% vs 99%. German workers are being had just as Greek, Irish, Spanish, etc. ones are. The powers that be love it when the 99%s of Europe go at each other. Virtuous Germans are tired of carrying all these lazy, profligate Southerners on their back, blah, blah, blah. This always comes across as racist, and I am always surprised at German defenders going there given Germany’s past history. But it also profoundly misses the point.
We know the workers in the periphery aren’t benefiting from the euro, but it is becoming increasingly clear that German workers aren’t either. So why should any of Europe’s 99%s want to keep it, and who (Hint: It’s Europe’s 1%s) is benefiting from it?