Krugman's mistake

Dear Mr. Krugman,

First of all, I'd like to say that I'm the type of person who appreciates frankness. I'm definitely not a fan of mincing words. The bush is not there to be beaten around. And this much is certain: I cannot hold a candle to you, sir. You won the Nobel Prize. I've only won the Ernst Schneider Prize, along with my colleagues in DW's business department. (I won't bother going into more detail - you can google it if you like.)

You've just written in your #link:http://www.nytimes.com/2014/12/01/opinion/paul-krugman-being-bad-europeans.html?rref=collection%2Fcolumn%2Fpaul-krugman&_r=0:esteemed column for The New York Times# about the Old Continent and how it is languishing and heading, as if in slow motion, toward another disaster - in stark contrast to the dynamic US economy. (I'm with you so far.) To blame, you say, are not the countries on Europe's periphery, such as Greece or Italy. Nor is France the culprit. No, you blame Germany.

In your opinion, Angela Merkel and Wolfgang Schäuble are the bad guys who hung the Europeans out to dry for the sake of their country's own economic interests. Respectfully, Mr. Krugman, you're mistaken.

You're not the first person to accuse our companies of exporting too much while Germans consume too little. Nor are you the first to criticize the fact that our unbalanced trade deficit is swelling to a precarious level. Germany has had to listen to such accusations for a while now, whether from the IMF, the US Treasury Secretary or its European neighbors.

But these accusations don't ring truer the more they are repeated. What is Germany supposed to do? Forbid its innovative mechanical engineers from being so innovative? Instruct its carmakers to stop what they're doing and produce more Trabants? Increase people's salaries by law? Fortunately, that's still a matter for unions and management.

I admit, I'm not a fan of Germany's new debt-free budget either. Wolfgang Schäuble wants to go down in history. Sure, it's his for the taking, but it's not really necessary. And frankly, we could use a few billion more euros for meaningful investments. For sure, the German government is making a number of costly mistakes, and Germany is going to have a high price to pay once the bills roll in. But that doesn't bother anyone else in Europe (for now).

Yes, Berlin should stop imposing its advice on Paris and other European capitals. It's the responsibility of the EU politicians in Brussels to keep the member states in check and urge - no, demand - fiscal discipline and reforms. But Berlin can just as well do without your advice, Mr. Krugman. Look at your home country: Do we advise the US government to refrain from fracking because it rattles the energy markets and interferes with a sustainable shift to renewable energy? Do we advise Washington to finally start chipping away at the gigantic mountain of debt that is far more threatening to the global economy than Germany's export surplus?

I'll tell you who got Europe into this whole mess (the Europeans' own mistakes notwithstanding) - it was the big American investment banks and all their gambling that triggered the global financial crisis. It certainly wasn't the respectable German savings banks. The enormous bailouts have driven the economies of many countries to ruin. I firmly believe that we have to find a global solution to this problem, but that's not going to happen as long as we continue only to point fingers at one another. Maybe that could be inspiration for your next column.

On that note, have a thoughtful weekend!

Yours,

Henrik Böhme