January 18th, 2015
in Op Ed
by William K. Black, New Economic Perspectives
If one wishes to know why Germany's financial elite embraces vicious economic assaults on their fellow Europeans of the periphery via the economic malpractice of austerity it is essential to consider not only that malpractice, but also the moral rot at the core of the German financial elite. This column updates my earlier discussion of Germany's internal financial troika, which makes Prime Minister Angela Merkel appear almost rational. My prior column skewered the New York Times' coverage of that troika. This update addresses the Wall Street Journal's woeful coverage of two members of the German troika.
What if the Federal Reserve's Number Two Official Were a Raving Bigot?
That was the situation at Germany's central bank. Dr. Thilo Sarrazin was one of German's most senior central bankers. Like so many of the ultra-right economists who inflicted austerity on the eurozone, Sarrazin is also ultra-right-wing in his politics.
"'Dr Thilo Sarrazin, a member of the executive board and head of the bank's risk control operations, told Europe's culture magazine Lettre International that Turks with low IQs and poor child-rearing practices were 'conquering Germany' by breeding two or three times as fast.
'A large number of Arabs and Turks in this city, whose number has grown through bad policies, have no productive function other than as fruit and vegetable vendors,' he said.
'Forty per cent of all births occur in the underclasses. Our educated population is becoming stupider from generation to generation. What's more, they cultivate an aggressive and atavistic mentality. It's a scandal that Turkish boys won't listen to female teachers because that is what their culture tells them', he said.
'I'd rather have East European Jews with an IQ that is 15pc higher than the German population,' he said."
Yes, one of the Germany's most prominent financial intellectuals actually said that things had gotten so bad that he'd prefer to have Jews, rather than Arabs and Turks, move to Germany. (Because, as we all know, Jews are "15 percent smarter.")
Herr Henkel: The "Respectab[le]" Racist
The second member of the German troika is Hans-Olaf Henkel. Henkel was the Bank of America's senior European advisor, and the former head of the German equivalent of the (combined) U.S. Chamber of Commerce and Business Roundtable when Sarrazin's hate speech was made public in early October 2009. Henkel responded with a media crusade in support of Mr. Sarrazin's bigotry. He gave video interviews and sent (and published widely on the web) an open letter to "Lieber Herr Sarrazin" to express his unqualified support for Mr. Sarrazin's pyroclastic flow of hate speech. Henkel entitled his letter: "Ich unterstütze Sarrazin ohne Wenn und Aber" (I support Sarrazin without any "if" or "but.")
Henkel did not resign as Bank of America's top European advisor until he ran for office as a senior leader (and principal funder) of the newly formed Alternative for Germany party, known as the AfD. While he was still B of A's top advisor in Europe he gave that ringing support for Sarrazin's hate speech and the following remarks about U.S. blacks. Henkel claims that the global crisis occurred because the U.S. banned "redlining" by banks. Redlining refers to the infamous practice of the FHA and home lenders circling communities in red on a map based on where blacks live. The lenders would refuse to lend for home purchases in those communities. The context is that Henkel was debating with James Galbraith the causes of the crisis. Henkel made this argument in writing. He did not make some spontaneous error in an oral debate.
"Mr. Galbraith should familiarize himself with Jimmy Carter's "Housing and Community Development Act" where in Section VIII Banks were prohibited the practice of "red lining" which until then enabled them to distinguish 'better living quarters' and 'slums.'"
As a footnote, Bank of America began as the Bank of Italy and it was known for lending to Italian-American "fruit and vegetable vendors" - the job that Sarrazin and Henkel derided as rendering ethnic workers unfit to be pure Germans (Reinheit). I pointed these facts out to the Bank of America's leaders in writing and they, of course, did nothing to remove Henkel as their top European advisor.
The NYT's Claim that Henkel makes the AfD "Respectab[le]"
Henkel now claims to be shocked, shocked that many members of his party are openly embracing German ultra-far right parties' political assaults on Muslims. The NYT, which failed to research Henkel's well-known record as a racist and ethnic and religious bigot, claimed that Henkel was the very model of "respectability."
"Güllner, head of the Forsa polling firm in Berlin, pointed out that in the May elections for the European Parliament, the AfD did especially well in voting districts seen as bastions of far-right sympathy, such as a region in southeastern Germany known as Saxon Switzerland. While Mr. Henkel helps lend the party an air of respectability, Mr. Güllner said, 'in my eyes it's almost an extreme-right party.'"
Indeed, as my prior article explained in detail, the NYT returned repeatedly to this meme, claiming that Henkel's involvement made it harder for the AfD's opponents to "stereotype" AfD members. As I have just explained through multiple quotations, Henkel delights in stereotyping and denigrating racial, ethnic, and religious groups he despises. The NYT's talent for unintentional self-parody grows by the day. Part of its ode to Henkel is his ability, due to his stellar reputation, to prevent the AfD, The Finns, and the Danish People's Party from being "stereotype[d]" as "right-wing cranks."
"Still, Mr. Henkel may make it harder to stereotype anti-euro forces in the European Parliament as a collection of right-wing cranks."
The AfD, The Finns, and the Danish People's Party, which the UK's Conservative Party recruited to be its allies in the EU Parliament's "European Conservatives and Reformists Group," are not "cranks" - they are rabidly bigoted parties. The NYT's claim that the addition of, Henkel, one of Europe's most notorious bigots, makes in "harder" to call AfD, The Finns, and the Danish People's Party ethnic, religious, and racial bigots boggles the mind.
The NYT felt that it was unnecessary to engage in the exotic process we call "research" before canonizing Henkel as the antidote to any charge that the AfD is a party that draws much of its support from bigotry. The NYT knew there was no need to research Henkel's actual positions on race, religion, ethnic origin, or status as a legal immigrant. Here's why:
"Mr. Henkel, a longtime member of the human rights group Amnesty International, strenuously denies that the ... AfD ...is a haven for the extreme right. He says such labels come from journalists who 'would rather paint us into an anti-immigration corner or a rightist corner so they can ignore us.'
He ruled out cooperating with far-right, anti-immigration groups like the Marine Le Pen's National Front in France or the U.K. Independence Party, led by Nigel Farage."
It suddenly dawned on me when I read this that the NYT thinks that if you join Amnesty you get amnesty from being recognized by the media as a raging bigot. All Henkel had to do was complain to the NYT that it is outrageous to "paint" him "into an anti-immigration corner" simply because he wrote that he supported, "without any ifs or buts" the claim that legal immigrants to Germany are so intellectually and morally inferior that they are destroying Germany and that he'd rather allow "Jews" to become Germans than "Turks."
Footnote: the AfD's youth wing promptly staged a joint meeting with UKIP, which Henkel and the AfD had supposedly "ruled out." They got along like (very white) peas in a pod.
The AfD and the Anti-Muslim Marches
Henkel is smart enough when interviewed by the NYT or the WSJ to avoid any hate speech and he understands that the failure of other AfD members and leaders to avoid the open embrace of hate speech is a critical tactical error in terms of German politics. That is why the AfD prefers to use Henkel as its face to the U.S. media. The reality, however, is that the AfD's support comes overwhelmingly from Germans who loath Muslims. The WSJ discusses this dynamic in a January 6, 2015 article entitled: "German Anti-Islam Protests Touch off Power Struggle in Euroskeptic Party." As rabidly bigoted as Henkel is, much of his Party's support comes from those who are so suffused with hate that they cannot emulate Henkel's tactics and pretend that they are not bigots. Naturally, the WSJ shares the unwillingness of the NYT to use this complex new technology called a "search engine" and find the facts about Henkel's open bigotry. The WSJ presents Henkel as the very embodiment of reason and love for all humankind.
"An upstart party, Alternative for Germany, has roiled the political landscape here since its founding two years ago, in part by eschewing the blatant anti-foreigner politics that have stunted other German right-wing parties.
But now a surge in anti-Islam protests across the country is feeding an identity crisis within the antiestablishment party that has become a force that threatens to unsettle Chancellor Angela Merkel 's broad governing coalition.
Co-founded by a Hamburg economics professor, the party gained its initial momentum with its campaign to get Germany out of the euro. Many of its earliest supporters were academics and small-business people. It landed in three state parliaments last year as it moved beyond its anti-euro platform to louder criticism of German immigration rules and support for conservative family values.
But as thousands of Germans take part in a new wave of weekly protests that criticize what many demonstrators call the creeping influence of Islam in Europe, Alternative for Germany-known by its German initials as the AfD-has reached a new crossroads. Some of its leaders want to expand their base by embracing the protesters more fully, even as founder Bernd Lucke and his allies fear the party will be branded as right-wing populists.
For now, some of Mr. Lucke's critics inside the party are pushing ahead with an effort to harness recent anti-Islam protests. On New Year's Day, several party leaders sent an open letter urging him to do more to attract a broader array of voters, including those who "fear being overwhelmed by Islam." To attract those voters, the letter said, Mr. Lucke needed to retain a structure of three co-chairmen of the party rather than taking over as sole chairman."
The article goes on to explain that regional AfD party leaders are openly meeting with the leaders of the purveyors of hate speech, against Muslims, a group known as Pegida. Anti-Muslim fears are the norm among AfD members.
"Polls show that the Pegida protests have strong support inside the AfD. A Forsa survey conducted Dec. 18 found 71% of AfD supporters believed the influence of Islam in Germany was so strong that it should be protested, compared with 29% in the public at large."
Lucke did not respond to the invitation to speak to the WSJ, but Henkel was happy to be quoted in his guise as the respectable face of the AfD to the credulous U.S. media. He is "respectable" only because the WSJ apparently lacks the resources to buy its reporters access to a search engine or train them how to use it to research Henkel's hate speech. Multiple search engines came preloaded onto my very inexpensive UMKC notebook computer. UMKC must be very rich and Murdoch very poor.
"But another deputy chairman, former top German business lobbyist Hans Olaf Henkel, has called it 'ridiculous' to court Pegida protesters, given their numbers represented a tiny portion of potential AfD voters."
Henkel understood that to have any chance of success his appeal to his fellow AfD party members not to openly embrace Pegida had to be solely realpolitik, not moral. The truth, as the polls and actions show, is that the AfD is made up of leaders and rank and file members driven by ethnic and religious hates and fears. What is special about the AfD members is that they are "euroskeptics" in large part because they don't simply hate and fear Turks and Muslims - they also despise the Greeks and Italians so much that they cannot stand to be in a faux "union" with them even when Germany dominates the EU.