Could Wolfgang Schäuble Save the Euro?
WHY YOU SHOULD CARE
Because traveling through Europe with a single currency is so much easier than carrying lira, francs, marks and pesos.
By Anette Kiefer
Some call him Chancellor Angela Merkel’s “Euro Fighter.” Others call him stubborn, tightfisted and power-hungry. He calls himself a “staunch European citizen” and “a cripple.”
Wolfgang Schäuble seems to have almost as many facets as the Europe he loves so much. His job has been particularly difficult since he took over as Germany’s minister of finance in 2009, the same year the euro crisis struck. But now, in the eyes of some, he’s the euro’s greatest — and perhaps final — hope.
Schäuble was elected to the German Bundestag in 1972, making him the longest-serving member today. Since German reunification in 1990, he has been a champion of the European Union.
“German unification and European unification are mutually dependent on each other,” he said in 1990, in his most famous political speech to date. “We have won our unity because Europe wanted to overcome her division.” His endorsement helped Berlin nab victory over Bonn as the capital of reunified Germany — and kept the European question in focus.
Now he’s trying to preserve the European dream by bolstering the euro.
The hope of a single currency for hundreds of millions of Europeans dates back more than 50 years. In the wake of two world wars, nations that had been enemies and were now partners had a long way to go to trust each other again, so the idea took time to gain momentum. It was not until the mid-1980s when concrete plans began to develop.
After the euro was officially introduced in 2002, its acceptance in member states grew, and they seemed to enjoy being in it together, for better or worse … until things turned worse. In a 2007 poll, only 36 percent of Germans were happy to have the euro, and many other countries were equally wary. The international financial crisis of 2009 drove the euro’s popularity down even further, and resentment among member states soared.
With countries like Greece faltering, half the continent felt like it was paying for someone else’s mistakes, while the other half believed it was being subjected to drastic cost cuts administered by foreigners.
None of which fazes Schäuble, who prefers to let results speak for themselves. After taking the finance helm, the press nicknamed him “King of Debt,” because Germany had to borrow more money from the banks than ever before. But Schäuble and his team quietly dug their way out of the red — a matter of pride for the Protestant from Freiburg.
Even as a boy, Schäuble had a reputation as a math genius and for being impatient “with others who were not as good as him,” his brother Thomas recalled. Now, two years into Schäuble’s second term as finance minister, the German government can run the country without having to borrow any new money for 2015 — and may even see a surplus — for the first time in nearly 50 years.
“We will only spend what we take in,” Schäuble promised, unable to resist the chance to goad his international colleagues. “This is a signal of reliability to the people and companies in Germany and in Europe.”
To make sure the euro enjoys similar success, Schäuble wants European policymakers to pass reforms to put their states’ financial houses in order. French leaders would prefer to use monetary policy — adjusting the euro exchange rate in their favor to stem economic decline — but Schäuble is clear: The French and other struggling economies must focus first on competitiveness, not on weakening the euro.
“Countries that have tried to manipulate the exchange rate in the past haven’t had a lot of success,” he said.
Schäuble would also like to see the establishment of a separate eurozone parliament for all 18 states using the currency, to allow them to integrate more closely and pass the legislation necessary to ensure economic reforms that support the euro.
“We need to enhance European integration in an intelligent way,” he explained.
Needless to say, other European countries are not amused, with the French rebuffing calls for a stronger euro, and the Swedish and British governments leery of greater integration.
At 72, Schäuble is hell-bent on making the euro his legacy. Rather than retire, he has expressed interest in another term; he’s convinced he can help save the eurozone.
“Wolfgang fights and struggles and slaves away for the euro because he knows that giving it up would mean sacrificing the most important achievement we as Europeans have been able to accomplish,” said the president of the European Commission, Jean-Claude Juncker.
Schäuble has no intention of letting them down.
- Anette Kiefer, OZY Author Contact Anette Kiefer