Veritas – Brace! Brace! Time for Merkel to take controls of the eurozone
David Warren, Australian inventor of the black box flight recorder, noted a key benefit of his invention was airlines could finally hear how pilots reacted to stressful situations.
It suggested pilots did okay, until about seven things went wrong simultaneously.
At that point, ringing alarms risked overwhelming them, and Warren’s ‘flight’ recorder turned suddenly into a ‘crash’ recorder, instead.
“Just tell pilots the main problems, they can work out the most important thing to do next,” Warren said years ago.
The days have long passed when only one eurozone warning signal each morning greeted German Chancellor Angela Merkel in her Berlin ‘cockpit’ – for that is where the eurozone’s course is being set now, not from Brussels.
Merkel probably now loses count of how many warnings sound each day.
About eurozone debt; about the euro; a planned-then-abandoned referendum; peripheral bond yields nearing, then hitting 7%; the irate press; furious German voters and domestic SPD Opposition; from a peripheral British prime minister; even, briefly, about the Slovakian parliament!
The original alarm – Greece’s debt to GDP ratio – probably seemed relatively small back in 2010 – like one landing wheel puncturing. Politicians organised a suitably low-key, ‘one-off’ rescue package.
The problem was, of course, markets already wondered if one puncture would cause a wing to snap, the fuselage to shatter, and the nose to grind down the runway.
Merkel and her eurozone peers should have reacted to these numerous alarms – but only one sounded at a time.
Greece, then Ireland, then Portugal, then bank exposure, Spain, Italy and now even France….
Merkel cannot now ‘jump ship’ and abandon the eurozone and euro. She has said Europe’s economic and peaceful future depends on its survival.
In any case, Germany parachuting now would, paradoxically, be suicidal for its exporting life-blood, because the reinstated deutschmark would rocket.
Berlin must now work out how to land the eurozone, if possible in one piece. There is a sense this week events could accelerate if politicians do not finally take a firm hold on the controls.