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Germany : The Economic Leader Of The 17 Nation Eurozone

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Germany is seen as the economic leader of the 17-nation eurozone. Berlin has had a considerably better public debt and fiscal deficit relative to the gross domestic product (GDP) of the most affected eurozone members. The Chancellor of Germany, Angela Merkel, insisted on ‘austerity’ by the affected states, especially worst-case Greece, rather than ‘bailout’ with external help. Thus, resulting in a polarized euro-opinion divided between the ‘austerity’ school and the more populist ‘growth’/bailout school. Germany’s action will be key to both the eurozone’s and the euro’s survival. She [Angela Merkel] rejected renegotiations of a fiscal pact on Europe’s belt-tightening, yet seemed open to talks on growth in a CNBC interview. She said, …show more content…

However, Germany, as the anchor economy of the Eurozone, has continued to benefit for over a decade. Its advantages lie partly in the size and diversity of the eurozone. Berlin called for demanding austerity measure that implied the belief of the Conservatives that intrusion of the government in the realm of production was a minimal measure. Nonetheless, public spending should have been cut drastically by eliminating deficits in the budget in order to empower private entrepreneurs to invest in productive activities. Resistance to the strict German prescription of austerity has grown since April 2012. It was no longer possible to ignore protests against budget cuts for all. The growing sentiment rallied against budget cuts and in favor of growth across Europe. Voters of Germany made the austerity-oriented ruling Christian Democratic Union (CDU) face a stinging defeat in the elections of May 13, 2012. Whereas its rival, the Social Democratic Party (SPD) opposed austerity and gained ground. Eurostat, which handles statistics for Europe, declared in May that unemployment in the 17 states of the eurozone had risen to a new high of 10.9%. Germany’s social capitalism with its ecological sustainability has been a successful system of organizing economic activity. It may have proved even superior to the US Wall Street capitalism.

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