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2015-07-22

Bill Emmott, a former editor of The Economist: Eurozone is happy to back Berlin when it is wrong and resist it when it is right, FT July 21, 2015

Eurozone is happy to back Berlin when it is wrong and resist it when it is right

Bill Emmott, a former editor of The Economist and executive producer of the ‘The Great European Disaster Movie’, FT July 21, 2015 

What I mean by “right” is the view expressed by Wolfgang Schäuble, Germany’s finance minister, that Greece should leave the euro, both for its own sake and that of the single currency itself. And even if you don’t think it is right, it is certainly logical.

It is hard to find a better definition of “wrong” than the fiscal pact of 2012, which mandates a universally tight fiscal stance in the eurozone, regardless of whether a country has an affordable level of public debt, regardless of the cost of borrowing and regardless of the state of aggregate demand, and which simultaneously rejects any idea that countries with large current-account surpluses bear any responsibility for adjustment.

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