Wednesday, May 31, 2017

A Big Burden

Legacies can be a mixed bag.  Coincidentally, two figures who do, or will, illustrate that most clearly are/were German.

Attributing a little too much to Martin Luther's impact on 20th century European history, Lutheran historian Martin E. Marty summarizes

Luther contributed to anti-Semitism in Germany. Because Jews frustrated him by not accepting the gospel, he turned on them, writing, “Burn their synagogues and drive them out!” Not much happened with that sentiment for a couple of centuries, but beginning in the 1800s, anti-Semitism increased more and more. It’s stupid to say Luther is Hitler’s spiritual ancestor. But it’s not stupid to say that in his rather blind striking out at Jews, Luther unintentionally provided the passion, vocabulary, and rationale for some horrible things that happened to Jews in our time.

Connection with vocabulary and rationale probably were more prominent than his effect on passion, for events probably would have played out roughly as they did without Luther.  Although Luther was prompted most by the practice of buying and selling of indulgences common in the Church, the impact upon mankind of the Great Reformer is nearly unparalleled because (according to the editors of Christianity Today)

Every Protestant Reformer—like Calvin, Zwingli, Knox, and Cranmer—and every Protestant stream—Lutheran, Reformed, Anglican, and Anabaptist—were inspired by Luther in one way or another. On a larger canvas, his reform unleashed forces that ended the Middle Ages and ushered in the modern era.

Not bad for an individual who in his later years became bitterly anti-Semitic and anti-Catholic.

Although lacking Luther's personal failings, Angela Merkel has in the past contributed to Europe's economic woes. Danny Vinik- in an article with a highly misleading headline- explains 

For years, German rules and regulations have held down wage growth. With productivity growing faster than workers' pay, German manufacturers have developed a competitive advantage against their international counterparts. Furthermore, this slow wage growth, in combination with tight fiscal policy, has led to less German consumer demand, an especially large problem for countries like Spain, Greece and Italy that have suffered because of lower consumer demand since the financial crisis. In other words, German citizens could be buying Greek wines and Italian pastas, providing an influx of money into those countries. But German economic policies have choked off such consumer spending, holding back both the recovery of their weaker neighbors as well as the global economy.

“By not encouraging a stronger domestic demand, Germany continues to be reliant on trade and exports to maintain their economic strength,” said Bruce Hirsh, a former assistant U.S. trade representative. “They would, of course, claim that’s just good economics. Whether that’s the case or not, it’s certainly having that impact.”

Germany has also benefited from the euro. The value of the euro is based on international trade and capital flows of the 18 countries that use the currency. Because Germany has a relatively stronger, more productive economy than its EU counterparts, the euro is effectively undervalued for Germany. In other words, if Germany was still using the deutschmark, the currency would be stronger, reducing exports and increasing imports. Germany would be less competitive internationally if it had a national currency. According to an International Monetary Fund report from last year, German’s inflation-adjusted exchange rate is undervalued by 10 percent to 20 percent, up from 5 percent to 15 percent in 2014. And in 2016, Germany’s dollar-denominated current account surplus — the amount savings exceed investment — was $300 billion, the largest in the world.

“When the euro is weak, Germany will be exceptionally competitive globally,” said Setser. “That’s a byproduct of participation in the euro.”

The Germans have also exported these macroeconomic policies to the rest of the Eurozone by forcing nations like Greece to adopt tight fiscal policy in exchange for bailouts. Such policies have benefited German manufacturers which have maintained their economic competitiveness, but it has led to a very slow recovery across Europe, which has weighed on the global economy.

If Angela Merkel were an American, she would be a very bad choice for Secretary of the Treasury or any other economic post.

But she is not an American, and is instead the head of state of Europe's premier economic powerhouse.   Further, she is not Chancellor of Germany while Ronald Reagan, Bill Clinton, George W. Bush, or another reasonably conventional politician heads the world's greatest superpower.

She is Chancellor at a time when the USA is headed by someone alternately not reasonable or ignorant, who consistently "plays the president on television and on Twitter."

Angela Merkel and the German people are highly conscious of the history of the first half of the twentieth century, and have been accordingly reluctant to assume military leadership in Europe.

History has taught us the peril of a militarized Germany, a lesson we were taught by British diplomat Hastings Ismay, who in the 1950s described the purpose of NATO as "to keep the Americans in, the Russians out, and the Germans down."

That aphorism is no longer valid, given that the European nations now are in a stage of cooperation, not competition. Fred Kaplan notes "Russian President Vladimir Putin's chief foreign policy goal is to restore the old Soviet Union," which can be accomplished "only if the European Union is weakened and the ties between the United States and Europe are severed." Donald Trump is pursuing those twin objectives, and the response must come from Berlin.

God must be partial to irony.  In the sixteenth century, it was up to Martin Luther, a monk with severe shortcomings, to call "foul" on the Roman Catholic Church. In the twenty-first century, it is up to Angela Merkel, who has stifled economic recovery on the continent, nonetheless to assume the role thrust upon her as leader of the Transatlantic Alliance, hence of the free world.

Share |

No comments:

On a Positive Note, It's What He Believes

During the War of 1812, Master Commandant Oliver Perry wrote to Major General William Henry Harrison " we have met the enemy and they ...