Germans Resent Plans To Bail Out Greece
STEVE INSKEEP, host:
It's MORNING EDITION, from NPR News. Good morning. I'm Steve Inskeep. Renee Montagne is in Boise, Idaho today, visiting Boise State Radio.
We've been reporting on the economic crisis in Greece, which is now spreading elsewhere in Europe. Spain and Portugal have been given credit downgrades. And it's falling to the continent's two economic heavyweights, France and Germany, to calm markets and contain the damage, if they can. They are coming together on a package, though it took a while to get there, and the different approaches had to do with politics, history, national temperament.
Eleanor Beardsley sends this report from Berlin.
ELEANOR BEARDSLEY: Back in March, when it became clear that Greece was unable to handle its burgeoning debt burden alone, French President Nicolas Sarkozy immediately proposed a concerted eurozone bailout package.
President NICOLAS SARKOZY (France): (Through translator) France and its partners will do what's necessary. I want to be very clear about this: The countries in the eurozone will fulfill their engagement. The euro is our money, and it means we will act in solidarity. There can be no doubt about this.
BEARDSLEY: When calls for a European rescue of Greece first mounted, German Chancellor Angela Merkel huddled with advisors and quickly decided that a bailout must be avoided at all costs. But as the crisis has worsened and showed signs of spreading, Merkel has come on board.
Getting support for the measure has been difficult in Germany. Polls show most Germans are against a bailout. Some of that reluctance might be explained by what could be called bailout fatigue.
Businessman Gerald Lisowski(ph) is having a class of wine at a trendy sidewalk cafe, just a few blocks from where the Berlin Wall once stood. The area used to lie in run-down East Berlin, but that was a long time and a lot of money ago, says Lisowski.
Mr. GERALD LISOWSKI (Businessman): We paid 20 years, more than 100 million -billion euros to the East Germany.
BEARDSLEY: Lisowski says Berliners have had to make sacrifices, and are still paying taxes to absorb their former poor, eastern half.
Unidentified Man: (Foreign language spoken)
BEARDSLEY: The fact that the Greeks are protesting austerity plans attached to their bailout money has not gone down well here. In Athens and other cities, civil servants, dockworkers and even the country's air force pilots have gone on strike against cutbacks and raising taxes in the retirement age.
Politically, it is harder for Merkel to support the bailout than Sarkozy. Her party risks defeat in a regional election on May 9th, and the parliamentary vote to release Germany's $11 billion share of the bailout money will probably take place just before that poll.
Markus Kerber is a professor of finance at Berlin Technical University. He says there's another reason Germans don't want to bailout: The Deutsche mark represented 40 years of sound fiscal policy.
Kerber says with the euro, Germans don't feel they're in control.
Professor MARKUS KERBER (Finance, Berlin Technical University): We are more and more confronted with the situation whereby our monetary destiny is decided by people we have never elected, and by people on whom we have no influence. We have no influence on Greek policy. Why do we have to pay for that?
BEARDSLEY: Kerber says other eurozone nations who run trade surpluses - the Netherlands, Finland and Austria - also resent having to bailout debt-ridden members.
Michel Godet is a Frenchman and an economic advisor to his government, but he agrees with the Germans. He says France has the same Mediterranean mindset as Greece and, like Greece, finances its growth through deficit spending. The big difference between the two countries is that the French government is not corrupt and is able to collect taxes, says Godet. He believes French taxpayers will pay dearly for the Greek bailout.
Professor MICHEL GODET (Economic Adviser to the French Government): What does it mean to help Greece? It means to increase our own national deficit. Because the rate of the French debt is 5 percent, and the Greek one is around 8 percent. So this game will not continue forever, you know.
BEARDSLEY: Both Godet and Kerber feel that some countries should leave the eurozone, or perhaps there should be two eurozones. But for millions of Europeans, including Germans, the euro has been a symbol of strength and unity, and they want to defend it.
Berliner Guilla Mayor(ph) is out walking her dog. She says the Greeks must change, but they can't be left to fail.
Ms. GUILLA MAYOR: They have to pay their taxes, just like Germans have to do. But Germany must give money for the Greek. We are together, all of the states who have the euro, they must stand together.
BEARDSLEY: Whether or not that will happen is the next chapter in this growing European financial crisis.
For NPR News, I'm Eleanor Beardsley in Berlin.
INSKEEP: Thomas Marzahl also contributed to Eleanor's report.
NPR transcripts are created on a rush deadline by a contractor for NPR, and accuracy and availability may vary. This text may not be in its final form and may be updated or revised in the future. Please be aware that the authoritative record of NPR's programming is the audio.