As the ECB supposedly takes it foot off the gas, and EU Summits and 'events' loom large for the careening wagon of shared sacrifice, unity, and sovereign risk, perhaps it is the nodding donkeys of Greek and Italian technocrats juxtaposed with Ireland's feistier "R" word gambit (and of course Zee German Overlords) that makes Art Cashin reflect somewhat philosophically on recent headlines. Their stereotypical interpretation has him concerned as the potential for ever-increasing culture clashes increases across the pond as sour memories and generational hatreds abound.
Sour Memories, Generational Hatreds And Stereotypes - To put this part of the note in better perspective, let’s reprise some comments from mid-month. We were writing about some folks from Europe who were kind enough to pay a visit to an irregular meeting of the Friends of Fermentation.
The conversation quickly went from the topic of the day, Greece, to the topic of the year, the existence and survival of the Euro-zone.
As the conversation became more intense, emotions rose closer to the surface. One finally said – “Look, over the last 150 years, the Germans have tried to dominate Europe through military might more than three times. The results were horrible for all. The French hoped that a European Union could co-opt any risk of another occurrence. With Germany as the centerpiece of an economic union, they would be foolish to attack anyone in the hope of becoming dominant.” “What the French never realized”, he went on, “was that Germany might come to dominate Europe without the use of tanks or airplanes. Be careful what you wish for”. The others all nodded heartily in agreement.
I gently tried to question whether most of Europe really felt that the Germans were using the crisis as an opportunity to dominate Europe. In reply, they cited the heartfelt letter of the Archbishop of Athens that we had noted last week.
"You saw that His Excellency referred to the people suffering being comparable to what they had suffered under German occupation in World War II. Do you think that was an accident? He made that reference with a purpose."
This deep seated distrust of the Germans was rather pervasive in the group. Headlines and stories coming out of Europe in recent days suggest that my cocktail associates were not unique. The exchanges are quite sharp, especially in Greece.
Over the weeks, since the sniping at Germany and allusions to its militaristic past have grown to a near cacophonous roar in European circles. Henry Chu, in Monday’s LA Times had a column on the topic that was headed like this:
Germany finds itself back in power in Europe
Germany is the unquestioned boss amid Europe's debt crisis and economic woes. But the turnaround has inspired discomfort among its neighbors and among Germans.
But the true sense of how strong these feeling have become is most evident in a commentary piece in Monday’s Der Spiegel by Jan Fleischhauer. Here’s the opening paragraph:
The German parliament is set to approve a new multibillion euro bailout package for Greece on Monday, but instead of thanks, southern Europeans are expressing their dislike of us. Germans will have to get used to their new role: We have become the Americans of Europe.
Now they’ve done it - “the Americans of Europe”. The author then reviews the caricatures that are evolving:
Sentiment towards the Germans isn't very good in the region right now. Hardly a day goes by without Chancellor Angela Merkel being depicted in a Nazi uniform somewhere. Swastikas are a common sight as well. It doesn't seem to help at all that we faithfully approve one aid package after the other. If calculations by experts are true, then we are far beyond the point where we are just providing loan guarantees.
A good deal of the €130 billion expected to be approved by the German parliament on Monday will never be seen again. But if you read the editorial pages of newspapers in the crisis regions, for whom this money is intended, you would be led to believe that we are out to achieve what our grandfathers failed to do 70 years ago (and this despite the fact that research into Hitler outside of Greece is fairly unanimous in the belief that National Socialism didn't launch its tyranny of Europe with a bailout package).
It won't be long before they start burning German flags. But wait, they're already doing that. Previously we had only known that from Arab countries, where the youth would take every opportunity to run through the streets to rage against that great Satan, the USA. But that's how things go when others consider a country to be too successful, too self-confident and too strong. We've now become the Americans of Europe. The role reversal won't be an easy one either -- it is already safe to say that today. We Germans are accustomed to having people admire us for our efficiency and industriousness -- and not to hate us for it.
But before we complain too much about all this ingratitude, we should remind ourselves that we ourselves spent years passing the buck. As long as the global villain was America, the Germans joined in when it came to feeling good at the expense of others. The Americans also had every reason to expect a little more gratitude -- after all, it was their soldiers who had to intervene when a dictator somewhere lived out his bloody fantasies while the international community stood by wringing its hands.
It is a thoughtful and well-written essay that shows the kind of culture clashes that may be evolving as the sovereign debt crisis proceeds in Europe. Let’s hope we can move past the stereotype lest more unrest fills the streets.