March 3rd, 2013
in Op Ed
by Dirk Ehnts, Econoblog101
There is a short video report (after the Read more >> jump) on who actually received the money from the bail-out which is very enlightening. This is the trailer for a German documentary for which the title is the headline here. In English it means "State Secret Bank Rescue." The trailer contains a number of sound bite quotes from various finance ministers excerpted from the full film.
[Video can be viewed after the Read more >> jump.]
You can watch the (52 min) movie online at the website of ARTE until Tuesday (05 March 2013). The finance ministers who appear are very interesting to hear. Mr Schäuble always repeats the phrase that each nation should fix its own problems. This means that the mindset of (at least) this politician is 100% German, and 0% European, and that he thinks that everybody is best of to follow only national interest or what is perceived as such. So, the Irish taxpayers bailed out the German savers, thank you very much. Germany’s national interest wins over the Irish, mediated by the European Central Bank. This is about political power, not about economic theory. Of course, many economic arguments would lead to advocate a bail-in instead of a bail-out, perhaps with a partial debt write-off. However, that is not what political reality allows.
Political reality allows a small group of people from the financial sector to get whatever they want without being made responsible for the mess they made. Nobody in Europe went to prison after all the money that was sunk in dubious investment projects. The corruption in Spain and Ireland, where politicians defended their own interests over those of the public, is not on the European agenda. It is sad to see that still that some very serious persons still believe that too much government debt caused the crisis. Their policies cripple the European economy.