Bravo, Mr.Andor. Show the German 'elite' where the hammer hangs !

On September 21, an outrageous report appeared in the Frankfurter Allgemeine Zeitung (FAZ), Germany's equivalent of the Wall Street Journal (except that it doesn't come close to the WSJ quality of journalism). FAZ reported that, during an interview with the EU commissioner for social policy, Mr. Laszlo Andor had the audacity to state publicly that Germany carries part of the blame for the euro crisis ! 

Mr. Andor added that Germany needs to make a contribution to correct the imbalances in the eurozone by introducing minimum wages in all sectors of its economy and by ensuring that German wages are adjusted according to the increases in German productivity (which has not been done during the last decade --> see my post on Germany's Agenda 2010). He even had the nerve to suggest that Germany needs a quota for women on the executive boards of companies so as to open up opportunities for all the highly qualified women on the labor market ! When the interviewer pointed out that these demands would not receive standing ovations in Germany, Mr. Andor explained that the measures are necessary from a European perspective and that the EU commission has the means to take action against countries that refuse to cooperate. 

Holy macro, that took the biscuit ! The Schei.... hit the fan among the readers of the FAZ, the self-appointed 'elite' of Germany composed of bankers, entrepreneurs, management consultants, wannabe millionaires and the like: Three hundred and twenty-five ! commentators heaped nasty insults on Mr. Andor and his native Hungary, including the suggestion that he is still a communist and that Hungary only wants to get access to German money. 

I haven't read all the comments as I was already getting sick to my stomach after reading 10 of those arrogant, chauvinist, jingoistic invectives. What happened to the tolerant, open-minded, solidary, committedly European Germans I grew up with ? This sounds more like the Germany of the 1930s, just before the Nazis took over the Reichstag with a 44% relative majority of the popular vote. As a German citizen I say: stop this chauvinist smear campaign against other Europeans right now !!!!! We (committed European Germans and our European friends) will not allow you to take Europe into the abyss this time ! The recent demonstrations in Greece and Spain may seem like a walk in the parc compared to the social upheaval the eurozone will experience if the political and economic aggression from Germany does not stop. 

I congratulate Mr. Andor for having the courage to stand up against the German ‘elite’and openly call on them to cooperate in the European spirit. It is high time for Germany’s ‘Merkelantists’ [1] to stop dragging their feet on a number of issues that would help Europe’s economy while at the same time improving the lives of regular German folks:

1.) Support of Germany's internal market and reduction of implicit export subsidies through various measures:

• The reduction of value added taxes which are only imposed on domestic consumption, implying a relative subsidization of non-domestic consumption, i.e. exports. 

• The introduction of minimum wages and the adjustment of German wages according to productivity increases to (a) reduce the growing gap between rich and poor in Germany; (b) improve the incomes and living standards of Germany’s working population, and (c) last but not least, to reduce eurozone imbalances in unit labor costs and trade. 

• The implementation of restrictions on the use of lower-paid temporary workers (Leiharbeit) and precarious labor contracts to improve workers’negotiation power in salary negotiations and thus raise incomes and domestic consumption. 

2.) Improve the work/life balance for parents; raise women’s employment ratio, living standards, and participation in high-level decision-making by:

• introducing flexible working hours and/or home office work for everyone;
• investments in more childcare facilities instead of punishing people for not having enough children, making innocent citizens pay for politicians’ failed family policies of the last 30 years; 

• implementing quotas for women on Boards of Directors and other high-level posts. 

3.) Support of a European banking union, incl. a clean-up of the German banking sector

For reasons explained by Prof. Yanis Varoufakis “It’sthe German banks, stupid !”German finance minister Schäuble refuses to support a true European banking union with supervizory powers over ALL European banks, including credit unions and Landesbanks. 

4.) Elimination of austerity policies & implementation of pro-investment and pro-growth policies in the eurozone, with a focus on Southern Europe.

• see the Manifesto for Economic Sense
  
• see my posts “Non-Sense Economics and the deepening Greek crisis”, “Austerity causes capital flight and discourages investors”, “Austerity chickens are coming home to roost“, “Message to Mme La Chancelière: STOP this austerity non-sense, you are destroying the euro zone !”
  
• see Prof. Mazzucato’s Bloomberg interviews of September 2012 (see video).
  
  
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[1] Merkelantism, lat. furiosa Teutonicorum insania. A contemporary German doctrine which holds that states, just like Schwabian households, should not spend more than they earn. An economic crisis will ensue if states continuously ‘live above their means’ by increasing their debt, because markets will begin to doubt their ability to service the debt. Therefore, to maintain or regain market confidence, states have to ‘save’ and implement reforms to cut public spending. [In this context, ‘reform’ is a code word for welfare cuts and the reduction of workers’ rights.] The aim is to improve competitiveness and increase export revenues so as to allow states to reduce their debt. This is the German guideline for economy policy in the eurozone and the economic conditionality for bail-outs or other financial assistance from eurozone institution.