Schauble “Going Rogue”

by Henry on October 3, 2011

I’m not going to be able to blog my opinions on the latest iteration of the eurozone crisis in any detail, thanks to an exceptionally busy week (comprehensive orals to be supervised, reports to be written, grant applications to be reformulated, papers to be presented and book workshops to be sat in upon). Semi-organized versions of my thoughts can be found here and here; John Quiggin and I have another short piece that will likely be coming out soon. But fwiw I was distinctly heartened by the news today that “Wolfgang Schäuble”: and “Alain Juppé”: are both floating the idea of real fiscal integration and accompanying democratic reforms of the EU. This has plausibly been orchestrated. If they are right to think that this could be pulled off, it would finally create an intersecting set in the “Paul Krugman Eurovenn”: I’m still not optimistic – but I’m now prepared to up the odds to a 35% chance that Europe could actually get out of this alive. I’ve always suspected that Schäuble was “playing a complex game”: – he’s now putting his cards on the table. Unsurprisingly, this is giving rise to howls of indignation from conservative and euroskeptical Germans – this _Spiegel_ “piece”:,1518,789661,00.html (in translation) gives some flavor.

bq. FDP parliamentarians have long been convinced that the finance minister is not playing with an open hand, and that he would prefer to force them out of the coalition. But there has also been an increasing amount of discontent over Schäuble among the ranks of the CDU/CSU parliamentary group. … Many conservative parliamentarians, regardless of their position on the common currency, feel as if they are being treated with contempt. … Many German politicians are also insinuating that he has a hidden agenda. They fear that one of the last fully committed supporters of the European project is taking advantage of the crisis to advance his dream of a United States of Europe … heedlessly allowed himself to be drawn into a dangerous debate over whether the EFSF could get a banking license and leverage its assets to borrow even more money from the European Central Bank (ECB). Most of his German predecessors in office would have rejected such notions with indignation and referred to Germany’s traumatic experiences during the 20th century … In addition to being imprudent, Schäuble’s comments showed bad timing. … discovered that Schäuble was using a torrent of words and statements in an attempt to conceal what he is really planning and thinking. … Schäuble’s political style is also characterized by a good deal of posturing. … Schäuble had merely demonstrated another tactic from his bag of tricks as a seasoned politician.

That he’s arousing such vehement opposition (and nasty articles in prominent German news magazines) suggests that he may have a better chance of pulling this off than I would have thought yesterday. Fingers crossed …