Tuesday, June 30, 2015

Dylan Matthews — "For Germans, economics is still part of moral philosophy": why Germany won't help Greece


Meet ordoliberalism. Neoliberalism is amoral, but ordoliberalism is stringently moral. It's perhaps no coincidence that the German Schuld means both debt and guilt, and therefore sin. "Ordoliberalism" also indicates the German fixation on order and orderliness (rectitude). Were Americans would say, Everything is OK, Germans say, Alles ist in Ordnung.

This means it is going to be very difficult to get a workable deal with respect to Greek unsustainable debt that German politicians can stomach themselves and also sell to their constituency, since the only way to deal with debt that is not payable is to write at least some of it down. This is an underlying reason for the seemingly unreasonable demand for a level of austerity that makes debt repayment unsustainable for the Greek economy.

Vox
"For Germans, economics is still part of moral philosophy": why Germany won't help Greece
Dylan Matthews

2 comments:

Pearce Tournier said...

The tenets of that vague thing Ordo-Liberalism are, however, infinitely malleable. Just think of Helmut Kohl's corruption and influence peddling. Ordo-Liberalism is now, and has always been, an excuse.

Ignacio said...

At heart there are a lot of bigots and racists in Germany, morality is just an excuse to express that. OFC Germany is just as corrupt at elsewhere, is only institutionalized in different ways. Remember that East Germany looting after unification was one of the biggest exercises in endemic corruption of the whole 20th century.