From: "Harald_Schumann"@spiegel.de Received: from notes3.spiegel.de (notes3.spiegel.de [112.11.0.12]) by mail.spiegel.de (8.8.4/8.7.3) with SMTP id LAA23944 for <lbo-talk at lists.panix.com>; Thu, 18 Mar 1999 11:14:10 +0100 (MET) Received: by notes3.spiegel.de(Lotus SMTP MTA v4.6.2 (693.3 8-11-1998)) id C1256738.00385AA5 ; Thu, 18 Mar 1999 11:15:32 +0100 X-Lotus-FromDomain: SPIEGEL To: lbo-talk at lists.panix.com Message-ID: <C1256738.00385A69.00 at notes3.spiegel.de> Date: Thu, 18 Mar 1999 11:13:36 +0100 Subject: Re: Farewell to Oskar Mime-Version: 1.0 Content-type: text/plain; charset=us-ascii Content-Disposition: inline
Brad de Long wrote:
Senior U.S.policymakers viewed Lafontaine as a useful counterweight
to the deflationists in Europe. For six years, now, U.S. policymakers
like
Lawrence Summers have been lecturing European finance ministers and
central
bankers on the desirability of demand expansion in Europe--and Oskar
Lafontaine is one of the few European politicians who openly agrees
with
the U.S.
That sounds rational. But why they refused to support him in public ? There
was no Wall
Street manager nor a US politician, who ever said in public, Lafontaine is
right. Instead
they supported the absurd central bank cult, saying a rate cut is
necessary, but
unfortunately not possible, because the german finance minister demands it
and endangers
the political independance of the ECB council.
Brad de Long wrote:
And no one has yet explained to me why Lafontaine did resign...
The main reason is, that the chancelor, Gerhard Schroeder, and his aid Bodo
Hombach (comparable to your White House chief),prefered to cooperate with
Lafontaines foes
in the business comunity instead of
supporting his legisaltive efforts. Other than Lafontaine, they realized,
that simply being
elected in a modern media democracy does not mean you are in power.
Lafonatine and his
amateurs did nearly nothing to convince the public and manipulate the media
in their
direction, while his foes knew how do it perfectly.
Imagine the scene: Lafontaine comes out with a new tax code, trying to
eliminate the
biggest loopholes for corporations. Their effective tax load has reached
the lowest level
in the whole OECD during the Kohl era. Then, the CEO of Allianz, Europes
most powerful and
biggest financial conglomerate threatens in public to move around 10.000
jobs to London or
another european tax heaven. A similar threat comes from the utility giant
RWE (30 % of the
german electricity market + 20 billion Euros annual turnover in other
branches like
machines,telecom, conmstruction etc.) and Daimler-Chrysler (which did not
pay taxes in
Germany since 1995).
What was the chancellors reaction? Did he protest against the blackmail
method? Did he
declare that the german tax system is extremely injust and needs to be
reformed the
Lafontaine way? No, against the advice of his finance minister he received
Allianz boss
Schulte-Noelle for a private conversation and promised a soon correction of
the terrible
new tax law. And this was only the last example of Schroeders Anti-Oskar
course. So, Oskar
realized he could not win anymore, thats all. What was the title of his
last book? "Dont be
afraid of globalisation!" - that was bad analysis and even worse advice.
Harald