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The Introduction of a Common Currency (May 7, 1998)

In this article from the left-liberal weekly Die Zeit, skeptical attitudes about the introduction of the Euro are tied to a general shift in public opinion with regard to European integration. Initially, as this journalist notes, integration could not go fast enough for many German citizens. Now, however, it was the rapid pace of integration that was sparking criticism. The author ventures a look into the future: a successful European currency could give Europe greater external strength, but it could also lead to tension within the community.

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The Euro. Now What? The Drama of Brussels and the Future of the Euro
The Monetary Union Brings Lots of Conflict and New Strength

Let’s forget about Monsieur Trichet and Mijnheer Duisenberg,* we’re talking about Europe: Europe is thriving, thanks to a statesman who did something historic for the second time. Helmut Kohl, the chancellor of German unification and European integration, will likely be voted out of office in the fall. Based on the mood in the country, years of work on the Euro and Sunday’s success** will do him absolutely no good in the fight for reelection. Kohl has been made to look like a loser because he did not assert himself completely.

Many Germans see themselves as the losers of the European Union. For them, the switch from the Deutschmark to the Euro is a sacrifice, not a gain. Some view it as a loss of power. Up to this point, the German Central Bank has held sway; it ultimately made decisions about the money and interest rates of neighboring countries. It made European economic policy. In the minds of nationalists in disguise, this, unfortunately, is a thing of the past, as though it were not a result of German predominance that all of Western Europe has accepted a currency system and a central bank based on the German model.

It is striking how the basic mood in the Federal Republic has turned around. Public opinion changed in the late 1980s. Before: When it came to European integration, things couldn’t go fast enough. Criticism came raining down whenever Brussels or the European Council failed to make progress. After: Everything was moving too quickly. Hold your horses! We’d better put the monetary union on the back burner!

European integration is no longer a welcome venture. Germany is afraid of the risks. In the postwar era, Germany saw opportunities and benefits for a long time. Europe offered a substitute identity for those who were no longer proud of being German. The EC provided support in the time of the Cold War. Its agrarian policies helped German agriculture immensely. And the Common Market spurred industry, which developed with renewed rigor.

*Jean-Claude Trichet, the former president of the Banque de France, and Wim Duisenberg, the former president of the Central Bank of the Netherlands, stood at the center of a heated dispute between Germany and France about who would lead the new European central bank that would run the new common currency. France wanted Duisenberg, the German-backed candidate, to sign an official agreement stating that he would step down from the position of president in 2002, four years into his eight-year term, so that Trichet could take his place. The dispute came to an end when Duisenberg announced that he intended to retire voluntarily in 2002. In the end, Duisenberg served as president from 1998 to 2003, at which point he was replaced by Trichet – trans.
** On Sunday, May 3, 1998, the leaders of the European Union agreed that 11 countries would adopt the Europe’s new single currency, the Euro, on January 1, 2002. The decision was reached after a 12-hour dispute between Germany and France about who should run the new European Central Bank – trans.

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