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Helmut Kohl is the cause of the euro crisis

Edith Rigler has sent
me her regular view from Europe, and I decided to add my own item to the list today.  This is because I spotted a very
interesting article by Wolfgang Munchau in Der Spiegel that blames Chancellor
Helmut Kohl for all our European ailments and issues. 

Here are the essentials
of Wolfgang’s column:

On the thirtieth anniversary
of the Helmut Kohl’s appointment as German Chancellor, everyone has been saying
how great were his achievements. 

were not great. 

If anything, he is the
person responsible for the mess that Europe lives with today. 

His ‘big idea’ was to reunite East and West Germany
when the Soviet Empire fell. 

We could
and should have let East Germany go away but he insisted in German unity and
that this was essential to European unity. 

It turns out to be quite the opposite, as It planted the seeds of today’s
euro crisis. 

By transferring the capital
of Germany to Berlin, West German politicians became immersed in a political culture
that is closer to Moscow than to Brussels, Paris or London. 

A different mindset came into play, and Germany
no longer saw itself as part of the EU, but as an independent power on a par
with Russia, the USA and China. 

Had we
stayed as a Federal Republic, we would have continued to feel ourselves as an equal
partner and would now be acting like the Netherlands: critical, but constructive.  We would have handled the euro crisis deftly
and fiscal union would already be the reality, the Greek debt written off and
confidence back in the system but, after
the vast expense of reunification, Germany just has not been able to
contemplate the sacrifice that these actions would entail. 

Kohl dreamed of complete European unity but instead,
thanks to his misguided actions, he may now live to see its destruction.


Meanwhile, here's …

Things worth reading: the European View (15)

Debit cards continue to win market share from
credit cards
Capgemini/RBS/Efma, October 10th,

The 2012 World Payments Report has just been
released. Its key findings are:

  • Debit cards continue to win market share from credit cards;
  • Brazil is now the second-highest ranking country by payment volumes
    after the US;
  • Payment volumes continue to be resilient, showing growth of 7.1% in
  • In 2010, payment volumes grew fastest in developing countries
    (nearly 17%);
  • Regulation can be both an obstacle and a driver to innovation.

What drives innovation? A new report provides
some answers
Committee on Payment and Settlement Systems,
October 2012

In order to obtain an
overview of payments innovation globally, the Committee on Payment and
Settlement Systems (CPSS), recently published the report ‘Innovations in Retail
Payments'. Some of the key findings of the report are:

  • Technological developments necessary, but
    not sufficient
  • Regulation is not just a European issue
  • Cooperation and standardisation are key factors for successful

Review of the Payment Services Directive (PSD)
is under way
European Commission, October 1st,

The Commission is
currently reviewing the impact of the PSD on the internal market with a view to
proposing a revision. Specifically, the Commission is reviewing whether

  • additional currencies outside the EEA should be included in the
  • provisions which are currently categorized as “exceptions” should
    be removed,
  • electronic money institutions (EMIs) and payment institutions (PIs)
    should be merged into one category of payment services provider (PSP),
  • new players in the payments market should have access to bank
    account information,
  • non-banks should have access to payment and settlement systems

The Commission has
thus published an issues paper in which it invites feedback from stakeholders
in the market by the end of November. 

The social costs
of retail payments in the EU amounts to €45 billion, nearly 1% of the combined
GDP of 13 European countries
 European Central Bank, October 2012

How much does it cost
to make a payment? A new report released by the European Central Bank (ECB)  analyses the social and private costs of
making retail payments in 13 European countries and discovers that they are
substantial, amounting to around €45 billion, or almost 1% of their combined
GDP. If extrapolated to cover the 27 Member States of the European Union (EU),
these costs would be around €130 billion.

Responses to consultation on shadow banking
have now been published
European Commission, October

In March 2012 the
European Commission issued a consultation paper on “shadow banking”. The 140
responses by public authorities, associations and individual contributors have
now been published and can be viewed on the Commission website.

Recommendations on reforming the structure of
the EU banking sector have been published
European Commission,
October 2012

The so-called Liikanen
Group (named after Erkki Liikanen, Governor of the Bank of Finland) has been
charged to present recommendations re. reforming the EU banking sector. The
Group recommends actions in the five following areas:

  • Mandatory separation of proprietary
    trading and other high-risk trading activities,
  • Possible additional separation of
    activities conditional on the recovery and resolution plan,
  • Possible amendments to the use of bail-in
    instruments as a resolution tool,Document6
  • A review of capital requirements on
    trading assets and real estate related loans, and
  • A strengthening of the governance and
    control of banks.

Read the full report here. 

Twenty years of European Single MarketEuropean
, October 2012

2012 marks the
twentieth anniversary of the EU. Here are some facts and figures:

  • Originally there were just 12 Member
    States; currently there are 27
    European Union Member States
    . In 2013, Croatia will join the Single
  • The Single Market was initially open
    to 345 million people in 1992. It can now be accessed by over 500 million people.
  • The EU has 495 million inhabitants  and has thus the world’s 3rd largest population after China and India. By
    surface area, France is the biggest EU country and Malta the smallest.
  • The EU has the largest GDP of any economy in the world.
  • At a global level the EU is the second largest region, behind
    Asia, by number of Internet users, with more than 380 million users – 73%
    of all EU households are connected to the internet.


About Chris M Skinner

Chris M Skinner
Chris Skinner is best known as an independent commentator on the financial markets through his blog, the Finanser.com, as author of the bestselling book Digital Bank, and Chair of the European networking forum the Financial Services Club. He has been voted one of the most influential people in banking by The Financial Brand (as well as one of the best blogs), a FinTech Titan (Next Bank), one of the Fintech Leaders you need to follow (City AM, Deluxe and Jax Finance), as well as one of the Top 40 most influential people in financial technology by the Wall Street Journal’s Financial News. To learn more click here...

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  • Stefan S.

    The german reunion would have come anyway after the collapse of the USSR, maybe not so fast, that was mere accident.
    The (for example) british interest for europe did not vanish because of the german reunion. It hasn’t been there before and was -if ever- tangible only on the income side…
    The referenced Spiegel article, which you are reflecting uncritically, is IMO total nonsense. It is the attempt to redefine with might and main a real positive part of the German history as something negative.

  • Chris Skinner

    Thanks Stefan
    I posted this as I wondered how extreme or mainstream Wolfgang’s view would be received by those of us dealing with EU integration in banking today. I don’t believe that the unification caused our issues today, but I do find Wolfgang’s view that Germany became infected by communist ideals and therefore less democratically European, an interesting angle.
    We cannot change the past but did the unification create a more or less European Germany I wonder.