Are the Markets Driving European Politics?

Der Spiegel poses the question to former Deutsche Bank CEO Hilmar Kopper in an interesting interview.

SPIEGEL: The markets are driving politics, leaving no doubt as to who is really in charge.

Kopper: I think that’s nonsense. Why does the political class refuse to accept that the market is merely a mirror being held up to them: neutral and incorruptible? What do people mean when they say that politicians must gain control over the markets? A planned economy? It makes me laugh. At times, politicians behave the way we did as little children, when we covered our eyes while playing hide-and-seek and yelled: You can’t see me!

SPIEGEL: So we should have seen the debt crisis coming?

Kopper: Yes, certainly two or three years earlier. Berlin, Paris, Brussels, the ECB, the IMF, the European Commission, the rating agencies, the banks — all of us. It’s the way it was in East Germany, when no one really recognized how broken it was. Or perhaps no one wanted to see it.

SPIEGEL: Is capitalism undermining the democracy that supports it?

Kopper: Why should it?

SPIEGEL: Governments have been replaced everywhere — in Spain, Greece, Italy and Portugal. Voters tend to elect people who aren’t promising overly drastic austerity measures. But “the markets,” for their part, don’t like this at all.

Kopper: The markets also don’t like it when people do nothing but save their money, but nothing can grow without investments. Citizens vote for their governments, even today. This couldn’t be more democratic. The Maastricht Treaty ratified by all member states provided the rules, so that more pressure could be applied to countries that don’t have a handle on their budgets. It was legitimate, and it still is legitimate. And now we Germans are seen as the evil ones in the European concert, just because we insist on stability and sticking to the rules — oh my God! We really have to put up with this.

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