Mr Roger Cohen of the New York Times writes in his column:
A strong Europe is essential to America’s recovery. The United States is too stretched — militarily and economically — to do without the cohesion of its closest allies.
There are three major European powers: Britain, France and Germany. Britain is going through a meltdown so severe that the joke there is that the country’s the next Iceland. That aside, its European credentials are always a little suspect.
And:
The recession is severe in Germany, but the country still has a savings ratio of 11 percent (it’s negative in the United States), a strong manufacturing sector and, after spending a staggering $1.8 trillion to integrate the Communist East, it has managed to get its budget close to balance.
And that is where I think America and the UK should learn from Germany. I have found it increasingly baffling that almost every economist has pointed to the need to increase consumption, the need to make people start buying again. I find it a little problematic that people do not seem to want to discuss how part of the current economic crisis was created by people buying what they cannot afford and spending money they do not have. I hear stories of people having more than three credit cards, and I simply do not get it. That is where Germans can teach Americans and the Brits a bit. An average German, for instance, spends what they have saved; and I don’t think there are many who hold multiple credit cards.
If only one lesson is taken away from the current global economic crisis, it should be that people cannot just keep spending money they do not have without eventually running into trouble. But, sadly, it seems that is not a lesson people are prepared to learn. At least that is what is shown by rhetorics of economists and policy makers who aim to get banks to start lending again, and people to start borrowing and spending again.
You can read Mr Cohen’s column here.
