Markus Ziener Headshot

Letter to Europe

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Barack Obama may be the anti-Bush. But make no mistake: That doesn't mean he is a European. This at least has become crystal clear in the weeks since he took over at the White House. Barack Obama is an American president making politics for America. If his ideas coincide with the ones of Europe -- fine. That makes things easier, more pleasant. But anyone who believes that this president is looking for counsel from his European friends is simply wrong. Barack Obama wants to take advantage of the crisis to completely overhaul the U.S. and to take the country to new heights. If he succeeds then in a few years Europe will have to deal with an ally who is one thing above all: self-confident.

Due to the financial crisis the differences between major parts of Europe and the U.S. have surfaced much faster than expected. The economic trouble almost operates like a catalyst. Look for instance at the stimulus debate. Although the American government has significantly toned down their criticism of the European programs to revive their economies internally the charges continue -- with Germany as the main culprit. Berlin is accused of not doing enough, spending only petty money to increase demand, even asking for a free ride on the backs of countries like the U.S. who are injecting hundreds of billions of dollars into their economies.

Over are the days when it was an honor to carry the label world export champion. These days the narrative goes like this: Germans want others to pay for their export-driven economy while not doing enough themselves. Did we miss here something? Wasn't there a time in the U.S. when competitiveness was something one could be proud of? And isn't it the best proof of being competitive if your stuff sells well on a global market? Not any more. Now Germans get hammered for being a top seller of goods.

Since this storyline is so catchy, facts don't matter much any more. Take the size of the stimulus: If you add the automatic stabilizers which are significantly higher than in the U.S. -- for example welfare benefits for the unemployed -- relative to the GDP the German package is almost as big as the American. The EU commission calculates that the German stimulus amounts to 4.7 percent of GDP while the EU average is 3.3 percent. The U.S. stimulus equals 5.3 percent of GDP. So why all the fuss?

And yes it's true that Germans carry some historical baggage when it comes to accumulating debt, printing money and risking high inflation. In the 1920s hyperinflation wiped out all the savings and discredited the young democracy of the Weimar Republic. One may say that this is long ago. Maybe. But in the German psyche this experience is deeply rooted. Therefore people and government are cautious when fiscal imbalances are looming.

And by the way: Germany is not the only country in Europe that has legitimate reason to drift from the American approach. The French have also difficulties to follow the Americans 100 percent and so do a number of other European countries. At the same time the differences are not so much about the direction in general, it's more about scope and pace. One size fits all -- this strategy simply doesn't work here. The crisis is way too complicated.

So with all the cheer and jubilation we will witness in the next couple of days around Obama Europeans should carefully listen to what exactly the U.S. president is saying -- to make out what is good or bad for them. This time it's more than ever about the nuances -- to avoid a hangover once illusion meets reality.