26 October 2008

26 October 2008 - It's the economy, stupid, not the banks or the Jews

A German economist has warned that we are repeating history:

BERLIN (Reuters) – A leading German economist compared the criticism of bankers over the global financial crisis to anti-Semitism in 1930s Germany, according to a newspaper interview released Sunday.

"In every crisis, people look for someone to blame, for scapegoats," Hans-Werner Sinn, president of the Munich-based Ifo economic research institute, told the newspaper Tagesspiegel.

"Even in the global economic crisis of 1929, no one wanted to believe in an anonymous system failure. Then it hit Jews in Germany, today it is managers," Sinn said, according to a transcript of an interview to be published in Monday's edition.
More than 60 years after World War Two, comments seen as qualifying the horror of the Holocaust, in which Nazis killed 6 million Jews, still cause a stir in Germany.

The newspaper said Sinn had authorised the quotes. No one was immediately available at the Central Council of Jews to respond to the comments.

Sinn welcomed the government's 500 billion euros (340 billion pounds) bank rescue plan and said that, if politicians had done nothing, as was the case in 1929, the results could have been a meltdown of the financial system and mass unemployment.

It could have led to the radicalisation of the Western world and eventually a crisis of confidence in the economic system, said Sinn.

"German history is with us and it is quite clear. The Nazis grew out of the crisis between 1929 and 1931. The Pied Pipers would be ready again today."

(Reporting by Madeline Chambers; editing by Andrew Dobbie)

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