Bailout Rebellion in Germany Heats Up

Wolf Richter's picture

For the first time ever, a clear majority (60%) of Germans no longer sees any benefits to being part of the Eurozone, given all the risks, according to a poll published September 16 (FAZ, article in German). In the age group 45 to 54, it jumps to 67%. And 66% reject aiding Greece and other heavily indebted countries. Ominously for Chancellor Angela Merkel, 82% believe that her government's crisis management is bad, and 83% complain that they're kept in the dark about the politics of the euro crisis.

"There cannot be any prohibition to think" just so that the euro can be stabilized, wrote Philipp Rösler, Minister of Economics and Technology, in a commentary published on September 9 (Welt, article in German). "And the orderly default of Greece is part of that," he added. Instantly, all hell broke loose, and Denkverbot (prohibition to think) became a rallying cry against the onslaught of criticism that his remarks engendered.

Even Timothy Geithner, who attended the meeting of European finance ministers in Poland, fired off a broadside in Rösler's direction. In the same breath, he proposed the expansion—through leverage, of all things—of the European bailout mechanism, the EFSF. According to Austrian Finance Minister, Maria Fekter, who witnessed the scene, he warned of "catastrophic" economic risks due to the disputes among the countries of the Eurozone and due to the conflicts between these countries and the ECB. Then he demanded in dramatic terms, she said, that "we grab money with our hands to stabilize the banks and expand the EFSF unconditionally."

The smack-down was immediate. German Finance Minister, Wolfgang Schäuble, took Geithner to task and explained to him in no uncertain terms, according to Fekter, that it was not possible to burden the taxpayers to that extent, particularly not if only the taxpayers of Triple-A countries were to be burdened. A bailout "with tax money alone in the quantity that the USA imagines will not be feasible," Schäuble said. (Wiener Zeitung, article in German).

Vocal support for Rösler came today from a group of 16 prominent German economists. If the government in its efforts to stabilize the euro didn't consider the insolvency of a member country, they warned, Germany would become subject to endless extortion (FAZ, article in German). And to impose a Denkverbot concerning it would be a step back into "top-down state thinking." They further lamented that these policies would turn the Eurozone into a transfer union. If the government wanted to establish a transfer union, it should discuss that with the German voters, they demanded, because it would be a fundamental change in the E.U. constitution and should be legitimized by vote. Otherwise, Germany would be "threatened by a populist movement to exit the E.U."

Meanwhile, on his visit to Rome, Rösler had to face down Italian Finance Minister, Giulio Tremonti, who'd "vehemently" demanded the creation of Eurobonds, sources of the German delegation said (Zeit, article in German). President of the European Commission, José Manuel Barroso, supported Tremonti's demands. But Rösler, like Merkel and others, rejected the idea. Transferring liabilities to other countries would remove pressure from debtor nations to reform, he said, differences in yields being a market-driven incentive to get the budget in order. Eurobonds are also legally impossible, he added, based on a recent decision by the German Federal Constitutional Court.

Eurozone must be honest: Big haircuts for bond holders, debt limits for all, says Die Zeit (article in German). The drama of saving European banks that hold Greek debt, and the debt of other tottering Eurozone nations, has been going on for a year and a half. Each effort to keep Greece on track follows the familiar script. Politicians promise spending cuts. Greeks demonstrate. E.U. inspectors check things out and leave angry. Germans declare that Greece will not get any relief until it fixes its problems. Then Greece notices that it needs yet more money and threatens to default. Germany nods. And the next installment gets paid.

By now, all hope for a happy ending has dissipated. Greece is suffering from a multitude of problems that defy quick fixes, among them a huge pile of debt, an inept and corrupt fiscal system where taxes are simply not collected, dysfunctional institutions, and a government-dominated economy. Even unlimited amounts of money can only defer the end game.

But there are already victims. The most recent one: The concept of an independent, apolitical central bank whose primary purpose is guarding the value of the currency, rather than monetizing the debt of countries that have spent beyond their means.

To see how it all started, read my first post on the Bailout Rebellion in Germany
Wolf Richter -

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
Construct's picture

The very concept of a bailout is ludicrous. You cannot have capitalism without bankruptcy. But we are coming to the end of this bullshit one way or another anyway. Countries/Central Banks are so indebted now that when the next crisis comes its game over.

Buck Johnson's picture

Germany knows whats going on, the rest of Europe wants them to continue to bailout the others mistakes without any undo hardships.  Germany is gone from the EU, just wait.

20yearRevolution's picture

I have argued for years that the EU and Euro experiment was the same as a couple getting a house, a bank account and a dog, but not wanting to get married. Even worse, they tried to make it work with a polyamourous relationship...guess it was fun while it lasted. Trade keys anyone?

Axenolith's picture

<quote>The concept of an independent, apolitical central bank whose primary purpose is guarding the value of the currency</quote>

When the hell is anyone going to get it through their thick skulls that this was and is NEVER the true objective of a central bank?!?!?!

Georgesblog's picture

Singin' my song, Axenolith. Central banks are in the wealth transfer business. They get real things, populations get worthless paper, For all of the gold that China has been buying, they're still stuck with a landfill of worthless paper. Central banks pillage everybody with poverty. Debt is the weapon. I wouldn't know anywhere near what I know if I hadn't met John Perkins when I was a Board Op in talk radio. I was thinking of John when I wrote "The Real Weapon of Mass Destruction: POVERTY" and "Fiat Addiction" The same methods that enslaved Africa are now working in the United States and the EU.

gwar5's picture

I always said the German people don't have the desire or stomach for this, nor should they. 

German hegemony of the EFSF and of Europe means they will have to be the enforcers. They will be despised by everyone else in the EU.  And they will lose big $$ anyway.



Soul Train's picture

True, and I am really surprised how long it is taking the German people to put an end to this. I would think there would be more street protests and riots - the Germans don't put up very long with having their wallets emptied. And this Eurozone circus act has gone on long enough.

I would like to hear from some German readers on this topic. Are you willing to subsidize (transfer your wealth) to Greece, Italy, Spain, and Portugal for this and next generation ???

Another comment, interesting reading Timmy's quote as it tells us how these American government thieves operate back home in the good ole' honest integrity USA -  that "we grab money with our hands to stabilize the banks and expand the EFSF unconditionally."

Ned Zeppelin's picture

Last I checked, the Germans will do, albeit reluctantly, as they are told by their leaders. No different than here, in fact we are far more docile in the US.  Greece will be bailed out, the new ECB saviors will see to it, and the ECB will deliver the printed goods and expand its balance sheet just like the Fed.  Why on earth would the banksters allow any other outcome? 

evolvedmonkey's picture

Americans disapproved of the bailouts to the degree of something like 90%... yet they happened anyway, and the sheeple did nothing (probably have even forgotten about it by now). With only 60% opposition, Germany does indeed appear rather complacent. This article seems rather sensationalist; premature at the very least.

Vendetta's picture

they voted for the other head of the two-headed hydra and got the same animal.  Its the 'power' of political division at work, making people think the "other side" isn't the same as "their side".  All fools eaten alive by the hydra.

Georgesblog's picture

We know that Commerce is a war zone. The conflict never ends. The world is made up of factions, struggling to gain advantage in the corporate structure. This is the context of history.  "From Babylon To The United Nations: Road Map To Armageddon" was written as a long series of daily posts. 


BernankeHasHemorrhoids's picture

Geithner has proven beyond a shadow of a doubt that he is a worthless criminal who deserves nothing less than a bullet in the head. He should be made to suck cock in every prison in America along with that Muslim bastard, Obama bin laden.

Ned Zeppelin's picture

Ever hear of a cocktail called a Bin Laden? 

Two shots and a splash. 

obejoyful's picture
Bailout Rebellion in US Heats up should be the headline

This week BofA unloads a bunch of worthless morgages on Fannie Mae so the bailout of the US banks continue.  Now we are backstopping the EU, how is there no riots in the streets over this crap.

SamAdams1234's picture

Someone answer this question:

If the PIIGS go down, which banks hold the debt?

What will be the consequence to the banks who hold that debt?

Will the collapse spread and to whom?

Who and which countries are left standing?


smiler03's picture

I found this chart useful to show who owes what to who.

I have no idea about will happen if it starts going tits up

Georgesblog's picture

Good question. It looks like the politicians are playing "Hot Potato" with the Federal Reserve making noise about jumping in. I see it as a backdoor wealth redistribution scheme. 

SamAdams1234's picture

Someone answer this question:

If the PIIGS go down, which banks hold the debt?

What will be the consequence to the banks who hold that debt?

Will the collapse spread and to whom?

Who and which countries are left standing?


Ned Zeppelin's picture

The wishes of the German people will be ignored - just like TARP here. 

bankruptcylawyer's picture

there's 2 choices.


bailout the banks and destroy society or

destroy the banks, then bailout the economy.

falak pema's picture

Spot on, and we are NOW at the ELEVENTH hour, one hour before mid-night.

I've been posting the same view, and pointing to the historical example of Philip the Fair and the Knights Templar in 1307/1314 in France, the leading power structure and economy of that age.

He destroyed their power as they were both a failed MIC structure of their age and a banker network. Their power was such they answered to no one but the Pope. They were truly transnational. They'd lost the Crusades, sterile exercise to ramp up an ideologically hate based war fed by the Popes in that region; which basically was a pretext to capture the East - West spice/silk routes trade from the Greeks of Constantinople and bring it back to Latin Europe (They succeeded  in this globalisation venture for a time, as the Crusaders + Venice's fleet took Constantinople from the Greeks, destroying forever their Empire in 1204. But Lost it again in 1261 as they did Holy Land in 1291). In the meantime the Templars became the BAnksta TRUST of the West, with inumerable churches run by them, a threat to Pope's  and King's economic power.

Philip the Fair destroyed their banksta network and nationalised their treasures.

We have to do the same today.  We have that historical reference. But O'bammy is no Philip the Fair...quite the contrary.


savagegoose's picture

fuck america let em devalue.

what if the rest of the world says fuck it, we'll stay the same with ea other and america can nosse dive? who the fuck is going to build factories in a shit hole like usa anyhow? just cuz the peasants are cheap to hire?

its only inflation in foreign countries if you peg to USD, if you float higher,  commodity price rises, are negated by your stronger local dollar. it dont mean shit that america is going ot hell in a hand basket, prices would remain the same.

Phil Free's picture

I hate going ot hell.  At least we can nosse dive with ea other.


Au Shucks's picture

There is but one solution.  It isn't a new one to humanity, but certainly unknown to most in the West.  The only answer is a Jubilee.  Anything short or less than complete and total private debt erasure cannot stop the collapse.  The PTB know this.  We must ask ourselves why they would rather throw the globe into complete chaos and economic, societal and political destruction rather that reset the debt.  The truly wealth bond holders would not be harmed by jubilee, but instead would be perfectly positioned to restart their wealth/power accumulation.  So, again... we must ask ourselves "why?".  The answer is not ignorance.  It is not greed.  It is not political hurdles. 

it is intentional.  unfortunately, that brings us back to "why?"


Nobody special's picture

A lifetime of intentured servitude may be a problem for the servant, but the master won't complain.  Do you really think the Elite want you free?  You have never been free.  You thought you were free and so you toiled hard for false a$$ets you thought provided future.  In years gone by, you could earn *some* freedom if you played the game well.  That opportunity is ending.

Those on the top have control and if those below them reduce consumption, who do you think benefits?  It doesn't take too many years of poverty before someone with a leased hummer will settle for a bicycle.  They simply need to have nothing before they get the bike.  And then they'll work... hard... to get up again, building surplus and bettering the lives of those who would consume.  Building riches for the top.

It is easy to understand what TPTB are doing now.  They're crushing the grapes to make wine.  You consume a lot and make little in excess.  You are grapes.  But once crushed, you consume less and create more excess clawing your way back to a better life.  Now you are wine.  Didn't know you would be harvested?  Should'a studied history.


Sidenote:  Death and dispair are tools that maintain the power elite.  Those who fail to see the opportunity provided by servitude are still grazing.  Leave naievity behind.  Lift your head and look around.  There is little coming that the elite fear.  In times of strife, they make their greatest gains.

Georgesblog's picture

The circumstances prove that God was right, to begin with. Men take steps sideways, end up going around in circles, and die in the wilderness. Yet, they keep coming back for more. It seems to be a basic component of human nature that people become self - destructive when money is involved.  

AnAnonymous's picture

The magnitude of the resources consumed by the US world order makes Jubilee impossible.

Debt is about replacing back resources you consume immediately.

Jubilees were bearable in times when the resources were consumed lowly.

Following that, if a jubilee, a new debt scheme will be implemented right after that.

Debt covers for two acts of consumption, the one done in the present and the one to be done in the future.


TwelfthVulture's picture

Plus, you all ignore the point that in Jubilee property returns to the ORIGINAL holder (from the last jubilee).  i.e., you don't get to writeoff your mortgage and keep the house.

AnAnonymous's picture

Considering the current mess in terms of debt and the fallacy introduced by the western civilization that success was owed to overcoming the environment, well, who gets what after a jubilee is very secondary.

cabtrom's picture

It is not about debt. It is about control.

Stuck on Zero's picture

So, exactly what role does public opinion play in the functioning of the illuminati in Germany or the United States?

Phil Free's picture

A decently important one.  A spike in public opinion can spark riots and runs on banks, after all.  This is why it is controlled and guided as it is.  Herd mentality -- a herd is easily guided in the desired direction.


franzpick's picture

My estimate is that 90% of sovereign executive energy is now being focused on 'perception management'.

chumbawamba's picture

"an inept and corrupt fiscal system where taxes are simply not collected"

Inept!?  That's exactly how a tax collection should work, e.g. not at all.

I am Chumbawamba.

X.inf.capt's picture

simple and to the point

i am in awe of the chumba

falak pema's picture

Dance the sirtaki on the beach like Zorba the greek, and stay a slave to foreign empires since donkey's years. If you don't pay taxes to your OWN republic, you pay debt slavery to other people's Oligarchies. Right NOW, Greece, its people, have the worst of BOTH worlds. No Republic and double penetration by the cheating local Oligarchs and greedy, predatory foreign ones.


Freddie's picture

Predatory foreign lenders?  The whole EU Euro "experiment" by the elites is total BS. IT created another layer of kleptocrat politcians to rob the populace,  Allowing a country that does not have a developed economy and never will to be side by side with a country that is the largest exporter of quality products is madness. 

A lot of you f***s on here want to keep bailing out govt workers and union employees like Hussein and Geithner just did.  They took US tax money to bail out govt and union workers in Greece.  Germany taxpayers should not have to carry Greek govt workers.

sun tzu's picture

Be a slave to the DC-NYC oligarchy so that you won't become a slave to the Brussels-London oligarchy

dcb's picture

I would like to see Germany and the other countries do the right thing and allow people to vote. But I think that won't happen. The first thing to realize is we loive in false democracies. We are ruled by the financial elites of the global system. No better example than Geither himself (not an elite, a puppet of them).


Look at his intitial answer. More taxpyaer money for the banks, in fact unlimited. and he's the president's premier financial advisor. At least in the europen press they have some debate. That doesn't even appen in the US we are so controlled.


Good article by the way.

unky's picture

For all Non-Germans: The FDP just said it should be allowed to think about a Greek default. The only reason they did this was because there will be regional elections in Berlin upcoming soon. The FDP is below 5% which means they will not go into the local parliament there.

If they truly would oppose the bailouts they would have been against it from the beginning of all the European bailout shit in 2010.


Look: All major parties in Germany agree to the bailouts (CDU, SPD, Green Party). If the both parties in power (CDU+FDP) loose some voters they just need to "consider a stop of the bailouts". This is enough to bring back the voters to them. But what actually happens is nothing. Meaning the bailouts will happen anyway by the same parties.


The CDU was loosing ground in Berlin too, so they paid some people to set some cars on fire, making the people demand more security and survailance activity by the government, hence support the vote for CDU (as the SPD is unable to manage the cars on fire).

nah's picture

how do you get 'debt limits for all' when the banks will cook the books... come on these guys need to come round to more than just greeks are dumb people


the central banks have no enforcement mechanism AT ALL



Kataphraktos's picture

You know, sometimes you ZH assholes really piss me off - contributors, TD and commenters alike.

My family lives in Greece. Those working are seeing massive salary cuts and unconstitutional one-off taxes. My retired parents have had pensions cut by 25%, one-off real estate assessment taxes (also unconstitutional) and special "national unity" taxes added to already back-breaking taxation.

This isn't about Germans against Greeks. This is about the raping of both German and Greek citizens by politicians to benefit bankers.

Another reminder: the kleptocratic regime that exists in Greece today was muscled into place by post-Yalta British and American intervention during the post-WWII Greek civil war, and kept in power by repeated political interventions, including a 7-year junta for which the Clinton White House officially apologized.

So reap what you sow, Anglo-Saxon assholes, and enjoy as defaulting Greeks tear your crypto-fascist societies to shreds. Perhaps, instead of making snide remarks about lazy Greeks - funny, considering the average 32 hours Germans work compared to the over-40 hours Greeks work - you could help a brother figure out how to get some well-deserved nooses around the necks of some vampiric Greek oligarchs and fat Jabba-the-Hutt government ministers.

ZeroAffect's picture

"So reap what you sow, Anglo-Saxon assholes, perhaps, instead of making snide remarks about lazy Greeks you could help a brother figure out how to get some well-deserved nooses around the necks of some vampiric Greek oligarchs and fat Jabba-the-Hutt government ministers."

First, most ZH'ers understand the USA is going to 'reap what has been sowed' by Wall Street banksters and corrupt government officials. 2nd, most ZH'ers would like to "get some well-deserved nooses around the necks of some vampiric" banksters and corrupt government officials here in the USA, politically speaking for sure.

Lastly, do not equate true ZH'ers to the trolls that use the site to sow discontent and post inflammatory comments about Greeks, Germans, Jews, Tea Partiers or Anglos. That is an attempt to evoke bad feelings against so-called 'Anglo-Saxon assholes'. So, don't allow them to suck you into playing their racist games of hatred and spew mindless drivel.

You could help keep the ZH community informed with information from your point of view. Just keep your viewpoints objective and straight-forward.

AnAnonymous's picture

Lastly, do not equate true ZH'ers to the trolls that use the site to sow discontent and post inflammatory comments about Greeks, Germans, Jews, Tea Partiers or Anglos. That is an attempt to evoke bad feelings against so-called 'Anglo-Saxon assholes'. So, don't allow them to suck you into playing their racist games of hatred and spew mindless drivel.


But those games are the heart of US citizenism.

This communauty is represented by all their members, including those who are called trolls and happen in this case to be the most numerous.

You could help keep the ZH community informed with information from your point of view. Just keep your viewpoints objective and straight-forward.

US citizens are propagandists. Facts only serve one purpose for them: material to be distorted to serve their propaganda.

Georgesblog's picture

Getting harvested i8s the price of playing the debt game. No one is immune from the culling of the herd. The United States is next, after Europe is devoured. This is playing out exactly as I described it in "Land & Wealth vs. Debt & Promises: The End Game" 

L G Butz PhD's picture

OK, so . . . are you from the future?

If so, are you aware of the quantum physics theory specific to time travel unlying conjecture regarding possible damage to chromosomes? 

If not, you DO know that predicting the future with certainty can do nasty things to certain vital organs high in fatty tissue, including but not limited to, the brain?

Georgesblog's picture

Stating the evidence of history is not predicting the future. Unlike those scientists in Italy, I'm not expected to predict earthquakes, and I don't do it. Describing the modus operandi of the racketeers at the central banks is a completely different matter. Writing pleasant things for the fraud addicts of the world is another thing that I don't do. 

Freddie's picture

What about the govt union employees and other union workers?  We see it in America where these vioolent criminal thugs in Wisconsin (many are teachers) and longshoreman in Washington state - resort to violence to protect their cushy jobs and benefits.