“One must prevent the dealings of the ECB from easing the pressure for improvements in competitiveness.”
(Angela Merkel, according to the FT.)
It is very good to see this sentiment being openly expressed by the German leader, since it is what we believe the German government thinks, and confirmation is useful. But, really, it is intolerable. Where in the treaties does it say that Eurozone monetary policy should be run in a sub-optimal and deflationary manner, thus increasing unemployment, putting the public finances under pressure and worsening economic distress more generally, so as to force other peoples’ governments to do things that the Germans think are good for them, but that have nothing to do with monetary policy?
No democrat should accept a Eurozone run along those lines.