The European Central Bank was engineered by the United States to ratfuck Europe. Eurozone countries can’t implement Keynesian economics because they’re not allowed to deficit spend over 3%; they’re forced to implement neoliberalism. The countries don’t have fiat monetary sovereignty, unlike the US.
Michael Hudson, 2010: Europe Sacrifices Labour for Finance
Europe’s policy of planned shrinkage controverts the prime assumption of political and economic textbooks: that voters act in their self-interest, and that economies choose to grow, not to destroy themselves. Today, European democracies – and even the Social Democratic, Socialist and labour Parties – are running for office on a fiscal and financial policy platform that opposes the interests of most voters, and even industry.
The explanation, of course, is that today’s economic planning is not being done by elected representatives. Planning authority has been relinquished to the hands of “independent” central banks, which in turn act as the lobbyists for commercial banks selling their product – debt. From the central bank’s vantage point, the “economic problem” is how to keep commercial banks and other financial institutions solvent in a post-bubble economy.
How did the US engineer the ECB?
Its design has Washington Consensus fingerprints all over it. Not to say that the US did it alone, without the involvement of European capitalists. The US has military bases all over Europe: major decisions don’t happen without the US’s tacit approval. The US had Europe in a vassal position during the Bretton Woods era, and wasn’t about to give up its economic dominance.
