With the Eurozone crisis in its fifth year, many continue to see the issue of Germany’s role and the future of the Euro as a prevalent one. In contrast to those who rally against the common European currency, C. Fred Bergsten continues to argue that Germany has an overwhelming number of reasons to make sure the euro succeeds, and that the Eurozone holds together through the crisis. While Germany has so far demonstrated the willingness to pay whatever price is necessary to preserve the Eurozone, Bergsten asks if it should indefinitely rely on financing its partners, or if it could rebalance its own economy in ways that would help adjust their imbalances. Are there feasible policy options, consistent with Germany’s affinity for stability, and abhorrence of fine-tuning, that could achieve such outcomes? Bergsten hopes such strategies might help overcome the “high-level stagnation” that is the legacy of the Euro crisis and could otherwise remain so for some time. C. Fred Bergsten was a Kurt Viermetz Distinguished Visitor of the American Academy in Berlin in Spring 2014.
06 Jun 14