May 23, 2012 Leave a comment
Most of you readers will know me as the Swiss guy. That is because of the website, the fact that I live in Switzerland and am a Swiss citizen. But I have not always been a Swiss. I was born in Germany, near Frankfurt. When I was young my parents immigrated to Canada and the US. Around 1994 I returned to Europe, with my wife, and lived in many places in Europe (eg UK, France, Germany, Austria, and of course Switzerland). In each place I have paid my taxes and been part of the system. I am telling you this because Chancellor Merkel is forgetting a very key aspect in this Euro crisis discussion. She is East German, and I am West German! Around the time of the walls falling my parents moved back to Germany from the US, where I was still living in Canada. I remember watching the walls fall on a TV in a dorm room and having a friend ask me, “does this make you feel good?” I answered yes!
About six months after the walls fell I traveled from Amberg Germany to Berlin. What I saw shocked me. East Germany was in a complete state of disrepair. The roads were horrible, houses did not have proper toilets, and everything looked so dreary. The East German economy was finished and nonexistent. East Germans were driving on the original roads built by Hitler. I am not kidding, as it was very interesting to see how long these roads lasted. The Chancellor of the time was Kohl. I have always liked Kohl as I thought he was one of Germany’s greatest statesmen. It helps that he was born in the same region was I was born ;). Kohl understood that for West Germany to move forward, it had to reunify with East Germany.
Enter my father, who was an East German. My grandfather was a capitalist who owned two companies that were taken away from him when the communists came to power. To make sure that my grandfather would not raise a fuss he was sent 5 years to a Siberian “work camp.” After his release my father and grandfather defected from the East to the West. My father after the wall fell wanted his old properties back, and he made a case of it. At this point enter West Germany, who having decided to reunify would also bail out East Germany. By bail out I mean BAIL OUT… Studies have shown that West Germany transfered 1.3 trillion dollars! Cost of reunification
Here is where you need to stop and think. West Germany rebuilt an entire country from scratch and I would argue in much worse economic shape than Greece. West Germany exchanged East German marks for Deutsch Marks on a 1 to 1 basis. West Germany agreed to honour the pensions of people who did not pay into the West German system. Imagine if West Germany had a Chancellor Merkel at the helm? Her solution would be austerity, austerity and more austerity! How would East Germany have fared? I will tell you how it would have fared, we would not have a reunified Germany and there would be no Chancellor Merkel at the helm!