Monday 16 July 2018

German policy on debt crisis is 'megalomania', says Schmidt


Brian Parkin and  Niklas Magnusson

Former German chancellor Helmut Schmidt speaks at the annual federal congress of the German Social Democrats yesterday in Berlin, Germany. Mr Schmidt warned against Germany taking too great a leadership role in the current eurozone debt crisis. Sean Gallup/Getty Images

GERMANY'S efforts to tame the euro-area debt crisis by dragooning its European partners into accepting tighter budget discipline border on "megalomania", former chancellor Helmut Schmidt said yesterday.

Mr Schmidt, a Social Democrat, said that he's "worried" about Chancellor Angela Merkel's Christian Democratic Union (CDU) led government trying to foist policy on the euro region in a manner that's hurting countries like Greece.

"It's better simply to make proposals" among partners during the crisis, Mr Schmidt said during a podium discussion in Hamburg yesterday.

Mr Schmidt said that "signs" of megalomania were evident in comments made by CDU floor leader Volker Kauder to his party's convention last month that "German is now spoken in Europe", referring to the influence of Ms Merkel's policy.

Two years into the crisis, Ms Merkel is stepping up her demands for European leaders to agree to lock in budget discipline with automatic sanctions on states that breach the rules.

Proposals aimed at driving toward "fiscal union" are due to be discussed at a European summit on Friday.


The German-led push "has nothing to do with some fears that Germany wants to dominate Europe", Ms Merkel told lawmakers in Berlin, saying that such accusations were "absurd".

Mr Schmidt (92), a former finance minister who served as chancellor of the then West Germany from 1974 to 1982, said the espousal of strict budget discipline was choking economic growth in Greece. (Bloomberg)

Irish Independent

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