Policy Briefs


A poll conducted by a German insurance company (R+V Versicherung) revealed that for two out of three Germans, the worst fear in life is having to pay the debts of other Europeans; worse than war, sickness, natural disasters or inflation. The results of the survey could appear to be the fruit of a special paranoia, but they reflect a phenomenon of political relevance that impacts on the possible solutions for the crisis plaguing the euro area. Aids and financial assistance to Greece will mean losses for all European taxpayers, with the benefit of all exposed banks, including German ones, which were among the most exposed to as creditors of Greece before 2010. But in the “last resort creditor” country, the euro crisis blew fears out of proportion, embedding them into the public language on which media and politics build their consensus and identity. In such a closed arena, when the ECB intervenes to buffer the crisis, it cannot dispel German fears, and instead reinforces group dynamics and conspiracy theories. After the last ECB press conference announcing new lowering of interest rates, for example, some newspapers defined the rate cut as Mario Draghi’s “expropriation” of German savings, a use of words that had hitherto remained confined to the most radical anti European propagandists.

Continue reading the document