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No offence, those are certainly interesting issues.

But in the case of Schäuble that's not a basis for running a heterogeneous monetary union.



A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman
by Migeru (migeru at eurotrib dot com) on Sat Feb 28th, 2015 at 11:58:52 AM EST
[ Parent ]
My own observation from watching the succession process in small but successful business firms in LA in the '70s was that they often, upon the death or disability of the founder, ended up being run by an accountant and I noted to one hapless, technical salesman working for such a firm in such a situation: "Companies run by accountants go broke! - unless they are accounting firms." He quickly agreed. It is slightly different with countries but the same logic applies. Dysfunction results.

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Sat Feb 28th, 2015 at 12:30:42 PM EST
[ Parent ]
Companies need entrepreneurs and businessmen. Countries need statesmen.

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Sat Feb 28th, 2015 at 12:31:35 PM EST
[ Parent ]
Hes was writing about accountants in professional accounting firms and their professional duties - keeping the secrets of clints and what not. About accountants selling services from outside, in other words.
by IM on Sat Feb 28th, 2015 at 12:52:12 PM EST
[ Parent ]
" for running a heterogeneous monetary union. "

And where exactly did you learn in 1973 to run a currncy union?

by IM on Sat Feb 28th, 2015 at 12:43:44 PM EST
[ Parent ]
(generic you)
by IM on Sat Feb 28th, 2015 at 12:47:22 PM EST
[ Parent ]
The (supposed) groundwork on single currency unions by Mundell dates from the 1960s. The notion of a single currency for Europe was then (until the early '70s) a hot number. The crises of the '70s put it on the back burner, to be picked up again in the '80s.
by afew (afew(a in a circle)eurotrib_dot_com) on Sat Feb 28th, 2015 at 12:51:12 PM EST
[ Parent ]
In 2000 Mundell wrote about his experiences in an an article I read as part of my Money and Banking course. In it he surveyed the history of the gold standard and noted the problem of expanding the money supply as required to keep the economy growing. This was during the Bretton Woods period, where gold was pegged at $35/oz. to the US$ and all other currencies were pegged to the US$. Mundell was a strong proponent of the gold standard as it provided an efficient means to redress trade imbalances by automatically correcting the relative valuations between currencies via gold flows or revaluation of a currency.

Mundell was an advisor to Richard Nixon and attempted to make the case for revaluing the gold fix of the US$ upward to reduce pressure for gold flow out of the USA during a long plane flight during which he was seated next to Nixon. But Nixon was too distracted to really listen and the opportunity was lost. I find this interesting as it seems it would probably work. The problem is that for most gold bugs the idea of an adjustable peg for gold makes their heads explode. The consequences of not making changes was the US going off the standard and 'closing the gold window' in 1971 - with no formal replacement for international settlements mechanism for FX.

"It is not necessary to have hope in order to persevere."

by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Sat Feb 28th, 2015 at 02:36:22 PM EST
[ Parent ]
Just like Napoleon said that the problem with England was that it was a nation of shopkeepers, the problem with Schäuble being the most powerful politician in the Eurozone is that you en up with a monetary union of beancounters.

A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman
by Migeru (migeru at eurotrib dot com) on Sat Feb 28th, 2015 at 02:10:32 PM EST
[ Parent ]
Napoleon lost.
by IM on Sat Feb 28th, 2015 at 02:26:47 PM EST
[ Parent ]
But not before wrecking half of Europe.

*Lunatic*, n.
One whose delusions are out of fashion.
by DoDo on Sat Feb 28th, 2015 at 03:15:28 PM EST
[ Parent ]
But to Russia, not England.

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Sat Feb 28th, 2015 at 05:03:45 PM EST
[ Parent ]
One historical parallel after another, each more and more disconcerting! :D

Peak oil is not an energy crisis. It is a liquid fuel crisis.
by Starvid on Sat Feb 28th, 2015 at 06:20:33 PM EST
[ Parent ]
Both.
by IM on Sun Mar 1st, 2015 at 01:49:03 PM EST
[ Parent ]
Sure, in the fine tradition of the English getting their asses handed to them for several solid years, and then claiming victory when they get bailed out by someone who actually knows how to fight against people who shoot back.

Now, don't get me wrong, the English were great at naval warfare, and at butchering defenseless natives in the colonies. But land wars against countries with population, organization and technology base roughly on par with their own? Not so much.

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Sun Mar 1st, 2015 at 02:23:17 PM EST
[ Parent ]
There was a little campaign in spain.
by IM on Sun Mar 1st, 2015 at 02:32:35 PM EST
[ Parent ]
Where the English took the credit for what was essentially a local insurgency. Until the Spanish guerrillas demonstrated the French could be defeated the English didn't get involved.

A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman
by Migeru (migeru at eurotrib dot com) on Sun Mar 1st, 2015 at 02:47:18 PM EST
[ Parent ]
As an aside, I've been reading a book on Goya's caprichos recently and I was stunned to see how much Spain suffered not only of the war itself but of the long standing consequences on spanish politics, the reformists being associated with the Napoleonic war and therefore suffering from repression after the french defeat. Goya himself, who is not suspect of being a support of the french, had to refrain from publishing some works and has seen some of his close friends suffering from the monarchist repression.
by Xavier in Paris on Sun Mar 1st, 2015 at 04:13:45 PM EST
[ Parent ]
Spanish history is a wretched mess:
The Trienio Liberal (Spanish pronunciation: [ˈtɾjenjo liβeˈɾal], "Liberal Triennium") was a period of three years of liberal government in Spain. After the revolution of 1820 the movement spread quickly to the rest of Spain and the Spanish Constitution of 1812 was reinstated. The Triennium was a volatile period between liberals and conservatives in Spain, and constant political tensions between the two groups progressively weakened the government's authority. Finally in 1823, with the approval of the crown heads of Europe, a French army invaded Spain and reinstated the King's absolute power. This invasion is known in France as the "Spanish Expedition" (expédition d'Espagne), and in Spain as "The Hundred Thousand Sons of St. Louis".


A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman
by Migeru (migeru at eurotrib dot com) on Sun Mar 1st, 2015 at 05:19:36 PM EST
[ Parent ]
This was actually part of the Revolutions of 1820, the second of the six big pan-European revolutionary waves.

*Lunatic*, n.
One whose delusions are out of fashion.
by DoDo on Sun Mar 1st, 2015 at 05:33:37 PM EST
[ Parent ]
But this is after the napoleonic/revolutionnary time in France.

I was more into the first round of semi-liberalisation, the one that led to 1812 constitution: a paradox that ideas brought by the french military presence were at the same time used against France and pro-monarchy, just to be crushed by the same monarchy when the french presence was no longer there to enforce them.

We could also speak of the tragedy of logistics, the lack of being a main reason for military depredation in Spain by the french army and the subsequent revolt by the spanish people starved to death by military requisitions.

by Xavier in Paris on Tue Mar 3rd, 2015 at 11:52:28 AM EST
[ Parent ]
The Enlightenment idea(l)s were not brought to Spain by the French military presence. Spain as a French client was part of the same cultural milieu in the 18th century and the first thing the Spanish did after kicking out Napoleon was to enact a liberal constitution in 1812. But the French-inspired intelligentsia got associated with Napoleon's occupation in the people's mind, and the rest is 170 (reactionnary) histoty, 160 years of it.

A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman
by Migeru (migeru at eurotrib dot com) on Tue Mar 3rd, 2015 at 12:01:08 PM EST
[ Parent ]
I did not say that liberal ideas had been brought into a desert Spain by french troops, but that the liberal in Spain had been bolstered by the presence of the french army (at the time, there were also a feeling of hope in some places at the advance of the french army, before the effects of war were felt, because of the aura of the french revolution. A lot of people accross Europe sincerely bought into the Empire=Révolution=Liberty, whereas from the french point of view, Napoleon is a kind of counter-revolutionnary: his politics were of stopping the reform mouvement and give it a conservative tinge that would render it acceptable for a bigger part of the elite.

And actually I'm not saying anything myself: that's just from a book read in spanish two weeks ago about Goya and the people around him.

by Xavier in Paris on Wed Mar 4th, 2015 at 04:36:18 PM EST
[ Parent ]
Well, I was reading up a bit and what happened was that after the French Revolution the Spanish monarchy became reactionary and for about 15 years until Napoleon's invasion in 1807-8 the liberals' political influence was on the wane.

But the fact is that the Spanish patriots fighting the occupation were liberal, too, as evidenced by the constitution of 1812.

A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman

by Migeru (migeru at eurotrib dot com) on Wed Mar 4th, 2015 at 04:41:21 PM EST
[ Parent ]
It is also what I said above. And they got screwed because they were associated to a foreign invasion even though some of them fought against it.

At least, that's the message from the book I read, which describes close friend from Goya hoping to use the french presence to get rid of some spanish bad habits (mainly religious influence that they criticized), and being deceived as the war -curiously quite secondary from a french perspective- takes its toll.

Anyway, as I haven't got enough background to argue here, and as I don't want to get involved into a new flaming debate here, after the one with IM, so count me as convinced. You may delete my messages if you find them too off base.

by Xavier in Paris on Wed Mar 4th, 2015 at 04:59:58 PM EST
[ Parent ]
Anyway, as I haven't got enough background to argue here, and as I don't want to get involved into a new flaming debate here, after the one with IM, so count me as convinced. You may delete my messages if you find them too off base.
Where did that come from?

A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman
by Migeru (migeru at eurotrib dot com) on Wed Mar 4th, 2015 at 05:27:04 PM EST
[ Parent ]
"Until the Spanish guerrillas demonstrated the French could be defeated the English didn't get involved."

clever, these shopkeepers.

by IM on Mon Mar 2nd, 2015 at 06:53:18 AM EST
[ Parent ]
Sure, that absolutely is the way to use a local insurgency, as Putin is also demonstrating in Ukraine right now.

But bragging about your martial prowess when everyone else did all the real fighting that won the war for your side is just pathetic. It would be like Iran crowing about how great the Revolutionary Guard is for winning the Iraq war.

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Mon Mar 2nd, 2015 at 07:41:35 PM EST
[ Parent ]
I haven't said anything about martial prowess. I just pointed out the the shopkeepers defeated Napoleon.
by IM on Tue Mar 3rd, 2015 at 07:09:13 AM EST
[ Parent ]
And JakeS pointed out that shopkeepers only bragged about defeating Napoleon...

*Lunatic*, n.
One whose delusions are out of fashion.
by DoDo on Tue Mar 3rd, 2015 at 09:54:37 AM EST
[ Parent ]
To revisionist for my taste. I stand for now by the traditional interpretation that bear and whale defeated the egale.
by IM on Tue Mar 3rd, 2015 at 10:17:04 AM EST
[ Parent ]
Actually, it's really a government influenced by shopkeepers. Wealth of Nations (courtesy of Marxists.org)
To found a great empire for the sole purpose of raising up a people of customers may at first sight appear a project fit only for a nation of shopkeepers. It is, however, a project altogether unfit for a nation of shopkeepers; but extremely fit for a nation whose government is influenced by shopkeepers.
by gk (gk (gk quattro due due sette @gmail.com)) on Tue Mar 3rd, 2015 at 01:01:27 PM EST
[ Parent ]
Since the late 17th century  has been a government of elites of wealth and power, divided between landed and commercial/manufacturing interests. It wasn't until the second half of the 19th century that the opinions of actual shopkeepers even really mattered. They were too far down the hierarchy and the elites were too good at getting what they wanted from the electorate, such as it was with the very limited voting franschise. As the franchise broadened the elites simply stepped up their game to stay ahead.

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Tue Mar 3rd, 2015 at 01:58:17 PM EST
[ Parent ]
This is why England relied so heavily on Continental mercenaries since the Renaissance. I am certainly no military historian, but, on two occasions, they did rise above the typical behavior and field at least competent armies, under Marlborough and under Wellington. The English never took to 'the Prussian Drill' with any zeal and were less susceptible to the nationalistic and revolutionary fervor that made France so strong after 1789. And that is not a bad thing, IMO.

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Mon Mar 2nd, 2015 at 09:19:07 AM EST
[ Parent ]
The English did better out of their navy, and the privatised militias created by/for the East India Company.

The rule was you didn't march around killing people - you did deals with the local big men, and/or introduced drugs and taxes and slavery, and then you marched around killing people, but only if you really had to.

Only the Dutch had a similarly indirect approach to international diplomacy. France, Spain, and the Habsburgs had a more direct and continental Big Arrmy tradition, which made for plenty of set-piece battles, but not so much long term 'growth and stability.'

If you don't understand how sneaky the British Establishment is, consider that England went through the Enclosures, the Industrial Revolution, wars with the Continent and the Colonies, a century of Dickensian squalor and oppression. and two world wars, but hasn't had a significant Euro-style revolution since the Civil War - and even that was largely a fight between merchants/pirates/barons and the monarchy.

And monarchy was restored almost immediately anyway.

While the UK likes to pretend it's the modern cradle of democracy, the reality is it's the modern cradle of neo-Machiavellianism, and the spiritual home of neoliberals everywhere.

by ThatBritGuy (thatbritguy (at) googlemail.com) on Mon Mar 2nd, 2015 at 09:52:02 AM EST
[ Parent ]
The two paragraphs preceding the money quote add valuable information:
Varoufakis is the newest finance minister in the Euro Group; Schäuble has served the longest. Varoufakis is a professor of economics, a man always good for a clever turn of phrase and a beaming smile. Schäuble is better known for being caustic and irritable. He is a lawyer by training and prefers practice to theory; he is matter-of-fact and deeply skeptical of those who seek to grab the spotlight. And he doesn't hold university professors in high regard.

Since Schäuble has gotten to know his new colleague from Athens, his appreciation for economy professors has dropped even further. He is suspicious of those who believe in their own theories and who think that the world is predictable. For Wolfgang Schäuble, societal behavior cannot be easily explained, not even by social scientists. That is why, he believes, negotiated rules -- and adherence to those rules -- is the best policy.

For Yanis Varoufakis, the euro is a defective currency. For Schäuble, it is his legacy.
(Money quote my bold)


Pacta sunt servanda is the only ground on which Schäuble can really stand. He dismisses everything else. This is sustainable for him only because, as the representative of Germany, his duty was to protect the integrity of the rebranded Deutchmark - like a good accountant doggedly protecting the integrity of his company's books and accounts - all else be damned. His attitude is as understandable as it is inappropriate to the present situation in the Eurogroup.  Change can only come with a change in leadership, or when, as last week, Merkel overrules Schäuble.

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Sat Feb 28th, 2015 at 12:52:00 PM EST
[ Parent ]
It is important to understand a bit of the history of the accounting profession here. Prior to the launch of Visicalc in the summer of '79 for the Apple II accounting was a really grinding profession requiring people with excellent numeric skills and a willingness to devote their lives to endless basic mathematics calculations. A business spread sheet was a thing of beauty, but any change might take a day to propagate through all of the rows and columns. Just doing the calculations to keep double entry books for companies up to date fully occupied most accountants' work days. This is also why economists only took, at most, intro accounting and held it in low esteem, failing to appreciate the power of double entry bookkeeping and stock and flow analysis for the most part as a consequence.

VisiCalc changed all of that. Now changes in an electronic spreadsheet propagated themselves through the spreadsheet automatically. Accountants found that they now could offer their employers and clients what if analysis and a whole range of higher order tasks. This pre-VisiCalc world of accountancy was the world in which Schäuble submitted his dissertation in 1971. Rules, rules, rules. Interestingly, rules did not keep him from accepting the cash donation over DM 100,000 contributed by the arms dealer and lobbyist Karlheinz Schreiber back in 1994, which led to him stepping down as head of the CDU and has dogged him since. So I guess he has some flexibility about rules.

"It is not necessary to have hope in order to persevere."

by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Sat Feb 28th, 2015 at 02:08:12 PM EST
[ Parent ]
I remember some of the brighter accountants messing about with Visicalc in the early 1980's and wondering what it was all about.  My enlightenment didn't come about until Lotus 123 and later Excel 4.

BTW - how do you know that a football team is made up of accountants?

It's the one with 11 goalkeepers....

Index of Frank's Diaries

by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Sat Feb 28th, 2015 at 04:49:48 PM EST
[ Parent ]
For Wolfgang Schäuble, societal behavior cannot be easily explained, not even by social scientists. That is why, he believes, negotiated rules -- and adherence to those rules -- is the best policy.
Two comments on this: the insistence on the essential unpredictability of society is a basic ingredient of Austrian economic "theory", and I suppose it is a justification for the Ordoliberal focus on "rules", but then who sets the rules, and based on what, and what do you do when unpredictable reality unpredicted when the rules were set does intrude and show the rules are inadequate? Do you rail that pacta sunt servanda?

The second observation is that I used to like German legal positivism until I saw the effect of legalistic adherence to rules on Euro crisis resolution.

As I don't like natural law as a basis of justice and I'm not religious, I'm left without a universal basis for law and justice, but I guess that just forces me to be responsible for my own political choices.

A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman

by Migeru (migeru at eurotrib dot com) on Sat Feb 28th, 2015 at 02:24:46 PM EST
[ Parent ]
For Schauble it seems that the answer to 'who sets the rules' is that it is natural for them to be set by the wealthiest and most powerful people in the society. That is the essence of conservatism back to the days of absolute monarch and monarchism as the ultimate conservatism. So what can be wrong with accepting DM 100,000 from Schreiber to do what he wanted done. It would all just seem to him to be a problem of appearances, but quite natural.

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Sat Feb 28th, 2015 at 02:46:48 PM EST
[ Parent ]
In addition the whole point of conservative 'sound finance' rules is to remove any discretion from fiscal policy.

A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman
by Migeru (migeru at eurotrib dot com) on Sat Feb 28th, 2015 at 03:29:27 PM EST
[ Parent ]
Max Weber's focus on rational rules as the basis of bureaucracy and modernity comes to mind: cf "The Protestant Ethic and the Spirit of Capitalism"

Index of Frank's Diaries
by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Sat Feb 28th, 2015 at 04:45:48 PM EST
[ Parent ]
Well, rational rules IS a step forward, if an insufficient criterion.

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Sat Feb 28th, 2015 at 06:01:08 PM EST
[ Parent ]
I think you got carried away. Schäuble is not a liberal but a conservative, for whom "rules" have a much stronger meaning. And even the "rules" mantra is not Schäuble's actual thought but a smokescreen narrative provided by Spiegel (and originating with Schäuble himself): Schäuble is not some retired school teacher struck in old ways but a seasoned manipulator who in truth has no trouble with the concept of changing the rules when it suits his agenda (think enhanced police powers).

Schäuble's and Spiegel's goal is to divert from a counter-narrative, which would be:

Varoufakis is the newest finance minister in the Euro Group; Schäuble has served the longest. Varoufakis is a professor of economics, a man always good for a clever turn of phrase and a beaming smile. Schäuble is better known for being caustic and irritable. Varoufakis is a macroeconomist and prefers an open consideration of facts to blind adherence to dogma; he is matter-of-fact and deeply skeptical of those who have no understanding of the issues but make policy via backroom deals. And he doesn't hold career politicians in high regard.

Since Varoufakis has gotten to know his old colleague from Berlin, his appreciation for career politicians has dropped even further. He is suspicious of those who moralise instead of arguing facts and think that rules come before understanding.

For Yannis Varoufakis, macroeconomics cannot be easily understood, even by economists. That is why, he believes, listening to expert advice -- and constant evaluation of what worked and what didn't -- is the best policy.



*Lunatic*, n.
One whose delusions are out of fashion.
by DoDo on Sat Feb 28th, 2015 at 06:44:09 PM EST
[ Parent ]
Of course. It's not about rules, it's about power relationships.

The basis of all right-wingery is a monarchic belief in the absolute freedom of privileged individuals and countries to do whatever the fuck they like without responsibility or consequences.

Rules are expedient to the extent that they promote those 'freedoms'.

The order of cause and effect is - start with the power relationships you want, then persuade everyone that the rules that promote those relationships are somehow economically, politically, socially, and even scientifically inviolable.

Greece and Varoufakis are challenging that by saying that the rules and the power they maintain are debatable, and may even be subject to democratic constraints.

Macro is actually a red herring. It may or may not be amenable to rational analysis, but its role here is to promote political persuasion and leverage, not to predict the future.

by ThatBritGuy (thatbritguy (at) googlemail.com) on Sat Feb 28th, 2015 at 07:49:19 PM EST
[ Parent ]
That depends on what 'liberal' means. In economics and political science in England it meant the transition from traditional ways of handling land, labor and capital that had evolved organically, even if not with much consideration for the lower rungs of society,  over thousands of years. At least it understood that the needs of subsistence of the lower classes had to be taken into account. Liberal economics turned many of those concerns into 'externalities' and smashed the organic view of society into millions of individuals, each with the 'personal responsibility' to take care of themselves, regardless of how impossible that might be. Such problems were not the concern of businessmen, who had to operate now according to the 'rational' rules of the new liberal economic political economy.

Classical Liberal Economics was the champion of the business class and the middle class against the rules of the feudal order. Especially of interest were changes to the way in which the biggest embodiment of capital - land - was treated, and of the substitution of 'rule of law', adjudicated by impartial trained jurists for rule by the aristocracy from traditional practice, but labor was next in line. And the rationality was from the context of economic competition. That is the core of present day conservatism and 'ordoliberalism' seems to me just another suit of clothes for the ideology, perhaps with truncheons as accessories.

I certainly did not take Schauble to be a liberal. Nor do I find adherents of the Austrian School to be particularly liberal according to how that term is used today. But then 'liberalism' today remains tainted by the economic liberalism of its youth in the early 19th Century. But Socialism has been smeared beyond recognition by a concerted, well funded 50 year PR campaign from the right. Karl Polahyi's Great Transformation is my touchstone here. He was a Socialist in Red Vienna after WW I who moved to England where he wrote his much neglected masterpiece. Unsurprisingly, conservatives prefer to ignore it. It would be hard for them to deal actively with his criticisms.

"It is not necessary to have hope in order to persevere."

by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Sat Feb 28th, 2015 at 08:11:22 PM EST
[ Parent ]
That depends on what 'liberal' means.

Liberalism is a centuries-old family of ideologies that developed in rather different directions in different parts of the world over the past two centuries, although all past and present forms are based on some notion of "freedom". In South America, 19th-century liberalism was much like Whig liberalism, and it moved further right to become the class ideology of the narrow urban bourgeois. In the USA, 19th-century Whig liberalism made way in the 1930s to a liberalism you are familiar with today, one emphasizing "[government provision of] equal opportunities [to practise individual freedom]" (which took roughly the same position as Social Democracy in Europe), while those liberals who didn't want to go the Big Government route chose the "libertarian" tag. In Europe, parallel to Manchester capitalism, there have been forms of liberalism that emphasized a radical rejection of royalism and clericalism, and forms that absorbed nationalism (the notion of "national freedom") and thus weren't against state intervention in the economy. In the mid 20th century, these made way to new forms that reacted to fascism and communism. These included the Central Europeans going into US exile and mingling with the libertarians there who advocated a full withdrawal of the state from the economy, and who birthed neo-liberalism (in which, IMHO, the central ideological novelty is that it is okay to impose "economic freedom" by taking away people's political freedom of choice). In post-WWII West Germany, one of significance was ordoliberalism, which wanted the state to limit itself to imposing order and rules upon private competition with the aim of limiting both the excesses of capitalism and the excesses of collectivism. But there was a wider notion (including but not limited to ordoliberalism) of "social liberalism", which viewed wealth concentration as an inherently corrupting and oppression-breeding condition prone to trigger a blowback and thus to be tamed by strong state re-distribution. This had influence not only on the card-carrying liberals of the FDP, but parts of the CDU (and later the SPD), though it shouldn't be over-valued: for many it was a fig leaf, a counter to "real existing socialism" across the Iron Curtain, and its anti-monopolistic theses never stood a chance against the idea of national champions (especially when large state companies like telecommunications or railways were eyed for privatisation from the eighties). But this liberalism is not Schäuble's background, while liberalism developed further since 1989 in Germany, too: the ordoliberal notion of imposing order to limit excesses of capitalism (in particular reining in and splitting up employer associations) or the social-liberal notion of re-distribution to counter-act wealth concentration are gone almost completely, while the rest merged with the imported Anglo-Saxonized neo-liberalism.

*Lunatic*, n.
One whose delusions are out of fashion.

by DoDo on Sun Mar 1st, 2015 at 03:58:33 AM EST
[ Parent ]
ARGeezer:
But Socialism has been smeared beyond recognition by a concerted, well funded 50 year PR campaign from the right.

42% of Germans find that socialism/communism are a good idea that was only implemented badly. https://www.freitag.de/autoren/felix-werdermann/linksextremes-deutschland/view?utm_content=buffercfa b3&utm_medium=social&utm_source=twitter.com&utm_campaign=buffer   Someone should organise them.

by Katrin on Sun Mar 1st, 2015 at 04:30:26 AM EST
[ Parent ]
I should have more specificly aimed that remark at Anglo countries. Advantage Germany and much of Continental Europe today. But the current EPP ascendance has rendered that moot and success of financial interests in governmental capture has gone just as badly, if not worse, for any concern about Social Europe as has developments in the USA. Worse because Germany and Europe had much more in the way of social protection to lose.

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Sun Mar 1st, 2015 at 12:17:36 PM EST
[ Parent ]
Yes, that makes sense. I believe that even the Anglo countries have some socialist traditions to connect to, though. The problem is that in most countries there is no party or organisation that could convincingly try to organise these people. And if Syriza fails, this will remain so.
by Katrin on Sun Mar 1st, 2015 at 12:52:50 PM EST
[ Parent ]
The wealthy buy out and/or co-opt all potential threats. And co-opted government officials, often personally convinced of the 'rightness' of their positions, add a serious layer of official disapproval. Then almost all media is owned by very wealthy people and the editors know where the red lines are.

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Sun Mar 1st, 2015 at 01:25:20 PM EST
[ Parent ]
I certainly did not take Schauble to be a liberal. Nor do I find adherents of the Austrian School to be particularly liberal according to how that term is used today.
Maybe I'm influenced by both the kind of people who call themselves "liberales" in Spain, as well as by Germany's Ordoliberalism.

A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman
by Migeru (migeru at eurotrib dot com) on Sun Mar 1st, 2015 at 09:46:02 AM EST
[ Parent ]
I have never been able to call myself a 'liberal' since reading The Great Transformation. I have liberal views on social issues - which is almost  all that remains of 'liberalism' in the USA. When the economic aspects are ignored you are missing the train and getting only the whistle. That is how we have ended up where we are.

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Sun Mar 1st, 2015 at 01:28:47 PM EST
[ Parent ]
This Spiegel article is a nice study in propaganda: it narrates Schauble's (supposed) thoughts throughout, but completely omits those of Varoufakis. The third-person talk gives a semblance of objectivity to an absolutely biased piece.

*Lunatic*, n.
One whose delusions are out of fashion.
by DoDo on Sat Feb 28th, 2015 at 03:12:32 PM EST
[ Parent ]
A Spiegel Alert automatically popped up in my head.

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Sat Feb 28th, 2015 at 03:19:25 PM EST
[ Parent ]
We haven't used that macro for some time: SPIEGEL alert

*Lunatic*, n.
One whose delusions are out of fashion.
by DoDo on Sat Feb 28th, 2015 at 03:27:39 PM EST
[ Parent ]


A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman
by Migeru (migeru at eurotrib dot com) on Sat Feb 28th, 2015 at 07:16:45 PM EST
[ Parent ]
And what is Schäuble up to now?

ekathimerini.com | Schaeuble softens tone, says Greece 'needs time'

"The new Greek government has strong public support,» Schaeuble said in an interview with German newspaper Bild am Sonntag.

"I am confident that it will put in place the necessary measures, set up a more efficient tax system and in the end honour its commitments.

"You have to give a little bit of time to a newly elected government,» he told the Sunday paper. «To govern is to face reality."

Schaeuble also insisted that his Greek counterpart Yanis Varoufakis, despite their policy differences, had «behaved most properly with me» and had «the right to as much respect as everyone else».

Well if you combine the obviously Schäuble-approved Spiegel article and the above, it's his usual Overton-window-shifting tactic: say something inflammatory and then pretend that you meant it in a much more harmless way than interpreted by everyone.

*Lunatic*, n.
One whose delusions are out of fashion.

by DoDo on Sun Mar 1st, 2015 at 01:26:10 PM EST
[ Parent ]

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