http://www.guardian.co.uk/business/2012/may/20/saving-eurozone-wont-solve-crisis

... What we are witnessing is a potentially cataclysmic conjuncture of the continuing crisis of modern finance capitalism and the inherent defects of the eurozone as originally conceived.

There are many paradoxes and ironies about this crisis. The whole idea behind the European Union was to ensure that there were no more wars in Europe. Closely associated with this aim was the desire to avoid the levels of unemployment and social unrest that caused the rise of extremist rightwing political parties. (Does a day go by without a reference to Hitler in the press or on the radio?)

In championing the exchange rate mechanism and then the eurozone, the French wanted to ensure that economic policy in Europe was not dominated by the Germans. Yet the latter continue to be more obsessed by folk memories of Weimar inflation than by the unemployment that led to extremism.

This is a battle that has certainly not been won by the French – indeed, when my friend Jean-Claude Trichet became president of the European Central Bank, he was widely accused of having "gone native".

The result of the French election shows that François Hollande is now being expected to take up the cudgels. Optimists – there are still some around – point to some apparent concessions by German policymakers on the subject of the asymmetry of eurozone economic policy. For instance, if southern members of the eurozone are ever going to narrow the gap in their price competitiveness with Germany, then the Germans should actively aim at a higher inflation rate. There is also wider recognition of the need for major infrastructure projects...

http://www.guardian.co.uk/commentisfree/2012/may/20/andrew-rawnsley-dont-blame-the-germans

... The jabbing fingers are furiously angry ones on the streets of Athens where German flags are burnt and the newspapers dress Ms Merkel in Nazi uniform. The jabbing continues in editorials in the American press, which charges Berlin with being single-handedly responsible for taking the world economy to the brink of the abyss. The jabbing is dressed in the language of diplomacy at this weekend's G8 summit where Barack Obama, François Hollande and David Cameron have ganged up on the German chancellor.

The American Democrat, British Conservative and French Socialist may not agree on much else, but on this, at least, they are together. It is one second to midnight in the eurozone because a recalcitrant and miserly Germany has refused to step up to its historic responsibility to do what is necessary to save the single currency. If the eurozone implodes, and carries away the global economy with it, the buck will stop in Berlin.

Let us begin by acknowledging that Germany does deserve a big helping of blame for the very scary state of the eurozone. Berlin shares, principally with Paris, responsibility for the original sin. That was to construct a badly designed and over-stretched single currency area containing contradictions that would explode under stress. In the pursuit of a European ideal, Germany forgot its usual prudence when Berlin nodded and winked at the admission of countries – Greece being the most extreme example – for whom euro membership was not only inappropriate but very dangerous.

It is fair enough also to observe that Germany has repeatedly failed to offer leadership that rises to the scale of the present crisis. When Germany has led, it has not always been in a well-judged direction. The austerity programme imposed on the Greeks as the price for continued membership of the euro was too draconian to be implemented in a democracy. The voters would surely revolt and they duly have.

The European Central Bank has been denied the necessary firepower to get ahead of events because the Germans wouldn't allow it. Ms Merkel has never been a very easy partner for her peer group. One of Gordon Brown's officials who had a ringside seat during the negotiations at the London G20 describes her thus: "Incredibly stubborn. Immovable. She simply digs in." One of David Cameron's team says dealing with the German chancellor is "like trying to squeeze blood from the proverbial stone"...

http://www.deccanherald.com/content/250908/apocalypse-fairly-soon.html

... Yet financing isn’t enough. Italy and, in particular, Spain must be offered hope - an economic environment in which they have some reasonable prospect of emerging from austerity and depression. Realistically, the only way to provide such an environment would be for the central bank to drop its obsession with price stability, to accept and indeed encourage several years of 3 per cent or 4 per cent inflation in Europe (and more than that in Germany).

Both the central bankers and the Germans hate this idea, but it’s the only plausible way the euro might be saved. For the past two-and-a-half years, European leaders have responded to crisis with half-measures that buy time, yet they have made no use of that time. Now time has run out...