Germany

Saturday

David Crane

What was it like at the time?

At midday on Thursday, 8 June 1933 — Erik Larson is very keen on his times — the newly elected President Franklin D. Roosevelt had a call put through to the history department at the University of Chicago. At midday on Thursday, 8 June 1933 — Erik Larson is very keen on his times — the newly elected President Franklin D. Roosevelt had a call put through to the history department at the University of Chicago. Since taking office in early March Roosevelt had been trying to fill the post of ambassador to Berlin, and with none of the usual suspects prepared to take on the job and Congress on

Thursday

David Blackburn

Is Merkel getting her way?

Below, courtesy of the Telegraph, is a leaked copy of the draft proposals on managing the Greek debt crisis.There are no measures to reduce Greece’s debts to sustainable levels; subsidy is the preferred route. This will presumably hit German taxpayers the hardest, but Merkel has managed to obtain private sector involvement, a clear German objective in these discussions.  However, this course is likely to lead to Greece’s selective default as creditors buy back bonds. The European Central Bank has declared that it is happy to allow this and will continue to accept government bonds in the event of sovereign default. This is a major retreat from its earlier position and commentators are clear that the Eurozone is now flirting

David Blackburn

Common Franco-German position on Greek debt

As I wrote earlier this morning, rumours of a ‘common Franco-German position’ on Greek debt were circulating in the early hours. Details are now emerging. Nicolas Sarkozy has dropped plans to impose a 0.0025 per cent levy on Eurozone bank assets, which was opposed by Angela Merkel for being much too cumbersome. In return, it seems that Merkel is prepared to consider the French-led plan of bond rollover. Merkel is also keen that private sector holders of Greek bonds pay their share of this second bailout. According to the FT, she favours a bond-swap deal, whereby bonds that will mature in the next eight years are swapped for new 30 year bonds paying a

David Blackburn

Getting a grip of the crisis

“I’m very worried, this building [the Treasury] is very worried and this government is very worried,” said George Osborne of the unfolding crisis in the Eurozone. In an interview with the FT, the chancellor goes on to say that he is in constant contact with his continental counterparts and urges them once again to “get a grip”. Eurozone leaders are meeting today to discuss further loans to Greece. Three options are being considered: first, an extension of the European Financial Stability Facility; second, private sector creditors re-lend money for a longer period and at a lower rate; third, impose a tax on banks to secure revenue for Greece. Despite a

Tuesday

David Blackburn

Euro crisis enters a new phase

It was a problem that would be fixed with a snap of the Commissioners’ manicured fingers, but now fresh euro-storms are louring in the near distance. As predicted over the weekend, the markets reacted to the European Banking Authority’s deeply flawed stress tests with fevered concern and a clear note of contempt. The FTSE shed 90 points yesterday, with banks among the day’s biggest losers. The performance in Frankfurt and Paris was equally baleful, as investors fled for safe commodity stocks. As Fraser has noted, Allister Heath argues that the Eurozone crisis is responsible for the booming price of gold. The markets have recovered slightly this morning; but that does

Saturday

David Blackburn

Inadequate stress test inspires anti-EU sentiment across Europe

Yesterday’s European Banking Authority (EBA) stress test was supposed to restore confidence in the euro and Europe’s beleaguered financial institutions; it has had the opposite effect. Investors and market analysts are preparing for ‘Black Monday’ after only 8 banks failed the test and must now raise £2.2 billion between them to stave off ruin. A respected estimate by Goldman Sachs expected at least 15 banks to fail, requiring £29 billion to recapitalise. As the Spectator’s business blog reported yesterday, analysts feared that the EBA’s test would not be sufficiently stringent, and so it came to pass. The findings have served only to undermine confidence in institutions across the continent, many of

Monday

Colleen Graffy

Stand up for freedom and freedom will stand up for you (eventually)

It was hard to be a supporter of U.S. President Ronald Reagan in Western Europe. As a student living in West Germany at the time, I remember well the commonly held view of him: B-rate actor who read cue cards, a nuclear-weapons-obsessed warmonger, and not very bright to boot. Never mind that he had also been a popular two-term governor of the most populous state in the U.S. (California), because that did not fit with the bumbling cowboy narrative. When he called the Soviet Union “the evil empire” the chattering classes saw it as simplistic, unsophisticated and cringe-worthy. Not so the people caught behind the Iron Curtain who silently cheered

Saturday

David Blackburn

In for a penny, in for a trillion

The news that the EU seeks a budget of £1 trillion between 2013 and 2020 inspired disbelief rather than ire. President Barroso’s almost childlike insistence that the proposal was ‘relatively small’ was amusing, certainly not alarming. It’s a classic EU trick: pitch for 5 per cent and a string of crazy financial measures (including a ‘Tobin tax’ on financial transactions) in the hope obtaining more modest gains of say 2 per cent. Barroso will also throw the odd concession into the bargain: the announcement of a £5.4bn saving on the Commission’s staffing costs represents a concession. But, Barroso has his work cut out to secure even a 1 per cent

Wednesday

Daniel Korski

Can Cameronism be Europeanised?

In 1997 New Labour was not just a domestic programme; it was a foreign policy too. Known as the “Neue Mitte” in Germany, Blair’s Third Way soon attracted such converts as the German chancellor, the French prime minister and the Danish leader. In the end, it produced few results for Britain, failing – much as Harold Wilson did in the 1970s – to curry favour for the UK through party political links with other leaders. But for a few years, much as New Labour looked across the Atlantic to the Democratic Party, so Europe’s Social Democrats looked across The Channel. International recognition for his deficit reduction plan notwithstanding, David Cameron

Friday

Peter Hoskin

Greece on the precipice

Europe is a doom-monger’s paradise at the moment. Riots in Greece; summary Cabinet reshuffles; meetings between Merkel and Sarkozy to save the single currency — and there’s still the potential for things to get worse, much worse. If the Greek government defaults on its debts, then there’s no knowing where the contagion will spread, only that it it will spread wide: from Spain and Portugal to markets across the world. Share indices have already been trembling at the prospect, although many of them rallied slightly today. One consolation, however scant, is that all this crystallises just what can happen to governments who operate beyond their means. Indeed, this seems to

Thursday

Fraser Nelson

The Lucifer Effect

Today’s papers are full of comment on the brilliant Panorama exposé of care home abuse. But none have mentioned what jumped out at me: the parallels between this and the Stanford Prison Experiment. The way that the tattooed Wayne treated his mentally ill patients is sickening — but, to me, this is not just a story about human evil. It’s a story about how institutionalisation brings out the evil in people, and that this evil is far closer to the surface than we like to admit. Philip Zimbardo, a psychology professor at Stanford, randomly divided 25 volunteers to play the roles of prisoners and guards in a poorly-regulated, mock prison.

Wednesday

James Forsyth

The Euro’s uncertain future

Martin Wolf’s column on the eurozone today does a superb job of summing up its troubles. As Wolf says, “The Eurozone, as designed, has failed.” Keeping its current arrangements is simply not an option for the eurozone. Wolf concludes that: “The eurozone confronts a choice between two intolerable options: either default and partial dissolution or open-ended official support. The existence of this choice proves that an enduring union will at the very least need deeper financial integration and greater fiscal support than was originally envisaged.” The question now is essentially whether Germany and other prosperous eurozone countries are prepared to embark on further integration and a programme of fiscal transfers

Saturday

Peter Parker

Goodbye to Berlin

Peter Parker is beguiled by a novel approach to the lives of Europe’s intellectual elite in flight from Nazi Germany In his time, Heinrich Mann was considered one of Germany’s leading writers and intellectuals. Unlike his rivalrous younger brother Thomas, who always put his literary career before any other consideration, Heinrich was an early and outspoken critic of the Nazis, and so forced to leave Germany in February 1933. He was based for several years in the south of France, while travelling around the world to denounce the regime he had left behind, and he eventually emigrated to America in 1940, settling in Los Angeles. Unlike many European emigrants who

Saturday

Hester Vaizey

A conflict of loyalty

What was life like in Hitler’s Germany? This question has long fascinated authors and readers alike, as books like Alone in Berlin, The Boy with the Striped Pyjamas and The Book Thief bear witness. What was life like in Hitler’s Germany? This question has long fascinated authors and readers alike, as books like Alone in Berlin, The Boy with the Striped Pyjamas and The Book Thief bear witness. Nazi Germany, it has often been argued, was a totalitarian dictatorship. Through force, indoctrination and even common consent, such an interpretation contends, Hitler wielded total power and had complete control of the German population. But were the tentacles of the Nazi state

Friday

James Forsyth

Mixed news from the Eurozone

France and Germany’s better than expected growth numbers are making news today. But the divergence within the Eurozone — Estonia grew at 2.1 percent in the first quarter, Portugal shrank by 0.7 per cent — highlights one of the single currency’s biggest problems: how can one interest rate fit all? Economists expect Germany, whose GDP is now larger than before the financial crisis, to continue to outperform the rest of the Eurozone. Given that Germany and France together make up half of the Eurozone economy, interest rates will have to be set with this in mind. But, on the other hand, the Iberian countries and Greece are struggling with austerity

Wednesday

Daniel Korski

Is Chris Huhne proving coalitions don’t work?

This country’s not used to coalitions. So when we got one we were sceptical. When it worked, we remained sceptical. When it worked really well, taking decisions that a majority Labour government dared not take, we began to come around to the idea. Most people seemed to accept that they could live with a coalition; that it had a certain utility. Now, we don’t know what to think following the spat between George Osborne and Chris Huhne. Is this proof that the coalition cannot work or merely an example of the way coalitions work? There are certainly worse examples of inter-coalition war in countries that often have coalition governments. German

Thursday

David Blackburn

Much ado about Brussels, bailouts and budgets

The news that the European Union has decreed that its Budget be increased by 4.9 percent in 2012 ties a knot in the stomach, as I ponder an Easter weekend spent in Margate rather than Majorca due to austerity. As Tim Montgomerie notes, the government is taking this opportunity to assert its euroscepticism. Stern communiqués are being worded; stark warnings are being issued. Behind the scenes, the government has joined with the Dutch, its closest ally on the Continent, to confront the avaricious Commission. Patrick Wintour reports that the French will also oppose the proposed Budget, and the Austrians, Danes, Swedes, Finns and Belgians are expected to lend their weight

Friday

David Blackburn

Merkel is running out of patience with the eurozone

Like an unseasonal Atlantic gale, the Portuguese sovereign debt crisis has blown in to ruin the latest EU summit. This meeting was intended to mark the beginning of the end of the eurozone crisis. Instead, the ponderous European Union has been overtaken by events, with grave consequences. Already speculation about contagion is rife: Spain, Malta* and Italy are now being spoken of in hushed and exasperated tones. The Economist’s Charlemagne correspondent reports that several countries are now wary of the monetary pact that Germany is demanding for delving deeper into its pockets, because they do not want to be accused of surrendering sovereignty. Likewise, the injection into the European Financial

Tuesday

Fraser Nelson

Nuclear hysteria

The above Japanese video – explaining the nuclear accident to children — makes a lot more sense than many of the hysterical reports we have been reading in the last few days. The figures are not out yet, but it’s likely that tens of thousands were killed by the tsunami. Yet the newspapers were all focused on the nuclear meltdown — which injured 15 people. The irony is that, when a tsunami strikes, the local nuclear power station is pretty much the safest place to be. This is the argument advanced in the leading article for the current issue of The Spectator (subscribers, click here; non-subscribers please join us for

Friday

Alex Massie

In Defence of Germany

Among the many odd things about the Libyan “debate” is the argument that Germany’s decision to abstain during the Security Council vote is somehow disgraceful and proof that Germany still isn’t ready to play its part on the international stage. (Obviously some of these objections come from the kind of rightists who fear or dislike German influence in other, more peaceful, areas of international politics and business. But never mind.) But Germany’s vote seems qualitatively different from the BRIC-blog of abstentions. Brazil, India, China and Russia each have reasons to be wary of this kind of resolution and, indeed, this kind of precedent. Deep down, I suspect some of them