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Comment by tomp | Hacker News Reader

> Germany is one of the riches countries on this planet.

A lot of that riches comes from the fact that EUR is a common currency both of economically successful countries like Germany and of economically weak countries like Greece. That makes the currency artificially undervalued, which boosts German exports and hurts Greek imports, making Germany more competitive and Greece less competitive (longer comment: https://news.ycombinator.com/item?id=8954377).

I think it's time Germany admits to that and pays its dues, by which I mean help finance the rest of EU (via a fiscal union).

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I'm not entirely sure what it is you're suggesting. The EU is designed to make us (Germany, France, etc.) more competitive. That unfortunately also means that countries like Greece don't profit as much (or at all, for that matter), but then again, nobody was forced to join to EU.

> I think it's time Germany admits to that and pays its dues, by which I mean help finance the rest of EU (via a fiscal union).

Do you really think we don't know what we're doing? You say we need to "pay our dues". You do realize we're talking about the fact that Greece can't pay it's dues, yes? As far as help financing the rest of the EU goes, keep on dreaming. There is no way any german is going to vote for that given that we have plenty of kids growing up below the poverty line.

> I'm not entirely sure what it is you're suggesting. The EU is designed to make us (Germany, France, etc.) more competitive. That unfortunately also means that countries like Greece don't profit as much (or at all, for that matter), but then again, nobody was forced to join to EU.

I'm suggesting that Euro (this has nothing to do with EU directly) can't survive if PIGS countries keep on loosing while Germany keeps on winning. Personally, I think it would be beneficial to keep the Euro and instantiate a fiscal union (like the US), but it's not up to me to decide. If Germany thinks it's in their interest to keep the Euro (and not have current Euro members exit the currency), it will have to think about other's interests as well. Ultimately, it's not a question if EU/Euro makes some countries more competitive (edit: relative to others) on this continent, but rather, if we stick together as a major global player.

> You do realize we're talking about the fact that Greece can't pay it's dues,

That's just because it doesn't control it's own currency. Otherwise, it could just devalue it, reduce the real value of its debt, and export more, i.e. normal monetary policy.

> There is no way any german is going to vote for that

The politicians will have to convince them, or do without the popular vote. It's not like the Greeks voted for austerity either...

Just out of curiosity, how would Greece having control of it's own currency reduce the real value of it's debt at this point? Considering 90%+ (to my knowledge but I could be wrong) of it's debt is to foreign countries and currently in Euro, even if it left the Euro and returned to the Drachma, wouldn't printing more money just reduce the debt's real value to it's internal creditors (pensions)?

Wouldn't that also be against what the current government is trying to achieve?

Yes. My answer was assuming that Greece never took up Euro in the first place. In that case, it would probably issue debt in Drachmas (although not all countries do - e.g. Argentina issued it's debt in USD under NY jurisdiction, because having defaulted so many times, it couldn't sell bonds in Pesos under its own jurisdiction).

This is utterly ridiculous. West Germany was FAR better off economically when the D-Mark was strong.

You're assuming that the D-Mark would be as strong (or possibly even stronger) as it was back then today. Which is a bold assumption. As a matter of fact, nobody (apart from some utterly ridiculous right-wing politicians) even considerers this an option.

If you literally mean that Germany was richer in the time before the introduction of the Euro, then simple GDP statistics show otherwise - not surprisingly, as it was a long time ago. If you mean the Euro was bad for the German economy, I wonder why you think that? By removing exchange rate risk, the Euro has made it easier for German businesses to sell to other Eurozone countries.

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