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The Six Mistakes of Germany’s Finance Minister: Charles Wyplosz

By Charles Wyplosz Feb 17, 2012 9:00 PM GMT-0300

One can accuse Germany’s finance minister of many things, but not of hiding his views. By saying that a Greek default is possible because the rest of the euro area can now bear it, Wolfgang Schaeuble has simply admitted that the strategy adopted since late 2009 has been designed to protect Germany, not to help Greece. By further suggesting that elections be delayed in Greece and that technocrats replace the remaining politicians holding ministerial jobs, Herr Schaeuble has shown how little he cares about elementary democratic principles.
Greece is being told by the so-called troika -- the European Commission, the International Monetary Fund and theEuropean Central Bank -- to undertake reforms of historical proportions, and to impose ever more cruel fiscal policies. The Greek parliament, elected before the crisis on a classic wishy-washy platform, has no mandate to carry out these policies, no matter how good they might be for the country. It would seem natural to hold an early election that would ask the Greek people what they are willing to stomach, now that they have been duly warned of the alternatives. Such contempt for democracy is deeply disturbing.
Schaeuble’s economic analysis of the situation is equally bad. His views contain no less than six technical mistakes.
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