A Quote by Barry Eichengreen
The consequences of a collapse would not be pretty. Whichever country precipitated it - Germany by threatening to abandon the euro, or Greece or Spain by actually doing so - would trigger economic chaos and incur its neighbours' wrath.
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A United States collapse would be much different than a Greece collapse. Greece can collapse, and there's a ripple. We collapse, and the world feels it.
First of all, Greece won't go down. We're talking about a country that is capable of making change. Europe will not allow the destabilization of the 27-country euro zone. But if there were no action, then markets would start becoming jittery about other countries - and not only Spain and Portugal, but other countries in the European Union.
If we were the problem, it would be very convenient - kick Greece out, everything's fine. What would happen to Spain, what about Portugal, what about Italy, what about the whole of the euro zone? We need more cooperation and less simplification and prejudice.
Germans tend to forget now that the euro was largely a Franco-German creation. No country has benefited more from the euro than Germany, both politically and economically. Therefore what has happened as a result of the introduction of the euro is largely Germany's its responsibility.
Greeks have to know that they are not alone ... Those who are fighting for the survivor of Greece inside the Euro area are deeply harmed by the impression floating around in the Greek public opinion that Greece is a victim. Greece is a member of the EU and the euro. I want Greece to be a constructive member of the Union because the EU is also benefiting from Greece.
The economic position is only flourishing on the surface. Germany is in fact dancing on a volcano. If the short-term credits are called in, a large section of our economy would collapse.
Businesses will only invest in Greece if three conditions are fulfilled. First, there must be a clear commitment to the euro. No businesses will invest if they have to fear that Greece will leave the euro zone at some point. Second, the Greek government must be prepared to work together with European institutions in order to restructure the country.
We won't get any growth in Greece by just imposing cuts. What I would prefer is a special economic zone for Greece.
I would describe that [friendship with Greek Prime Minister Alexis Tsipras] as a utilitarian friendship. At the time, his country was facing the prospect of leaving the euro zone and many Greeks felt abandoned by Europe. In such a situation, it seemed appropriate to me to present myself as a friend to Greece. It had to do with the country's dignity.
I think as a business it would be amazing if the euro was to collapse, but financially and economically I think that would be a bit of a tsunami for everybody to cope with.
The euro zone was driven by the neoliberal view that markets are always efficient. That in itself is political. There was no pressing economic need that the euro was required to solve, but leaders believed that it would foster growth.
Economic polarization is also occurring between creditor and debtor nations. This issplitting the eurozone between Germany, France and the Netherlands in the creditor camp, against Greece, Spain, Portugal, Ireland and Italy falling deeper into debt, unemployment and austerity - followed by emigration and capital flight.
I would caution against fueling cheap populism. First of all, every German who has spent a vacation in Greece knows that the standard of living there isn't higher than it is in Germany. Second, Greece is paying a high price for European assistance.
The euro is a vital issue for Germany. There is no other country that derives as much benefit from the common domestic market and the monetary union as Germany.
If I were a German today, I would be proud, proud but also worried. I would be proud of the magnificent achievement of rebuilding my country, entrenching democracy and assuming the undoubtedly preponderant position in Europe. But a united Germany can't and won't subordinate its national interests in economic or in foreign policy to those of the Community indefinitely. Germany's new pre-eminence is a fact - and its power is a problem - as much for Germans as for the rest of Europe.
Germany would be the biggest loser in a euro breakup.
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