Dimitri Papadimitriou speculates that Germany might just end up being the eurozone country that decides it’s not worth staying in the union.
Germany, says Papadimitriou, has boxed itself in such that, as one of the only eurozone countries that’s growing, it must ultimately bear the major responsibility for the rescue packages that are being offered for troubled countries like Portugal, Greece (x2), and Ireland—and that may soon have to be put in place for Spain. While an exit is unlikely as long as Angela Merkel is in power, Papadimitriou reminds us that she’s up for re-election next year, and the winds of political change have started blowing in Europe.
Read it Multiplier Effect
Will Germany Break Out of the Box It Has Put Itself In?
by Michael Stephens
That Germany will be first out has been my bet from the get-go. The Bundesbank will never go for what fiscal union would take and going forward would not be possible politically in Germany anyway. It's only going to be possible to punt for so long before the reckoning. And Germany has the DM to fall back on.