Merkel 'taking Europe in wrong direction'

2012-02-12 14:54

Berlin - American billionaire George Soros slammed German Chancellor Angela Merkel in an interview published on Sunday, warning that her policies could lead to a repeat of the Great Depression.

"I admire Chancellor Merkel for her leadership. But unfortunately she is taking Europe in the wrong direction," the financier and philanthropist told the weekly Der Spiegel.

Soros warned against addressing the crisis with spending cuts, urging the injection of funds instead.

"Otherwise we will repeat the mistakes that plunged America into the Great Depression in 1929. That's what Angela Merkel doesn't understand," he said.

US President Franklin Roosevelt addressed the crisis in 1933 with his New Deal, inspired by British economist John Keynes, which combined a reform of the banking system with major infrastructure projects.

Soros also told Der Spiegel, in remarks published in German on the magazine's website, that he thought Europe could handle the crisis without the help of the International Monetary Fund.

He said it was a mistake to offer a bailout to Greece tied to high interest rates. "That's why the country can't be saved today, and the same thing will happen to Italy if we put this country in the straitjacket of paying harsh interest rates," Soros said.

A Greek default would cause an escalation of the crisis and could lead to a run on Italian and Spanish banks, and "Europe would explode", he said.

  • Hartmut - 2012-02-12 15:45

    It's about time somebody see things as they are. But the very same is vali for South Afica!! If we want to grow as a nation we can't do that without a certain inflation, because the necessary investments have to be pre-financed which is inflationery. if you cut spending, you cut taxes, available income, andsoforth>>> depression

      Alma - 2012-02-13 13:01

      Soros may be right as far as Europe is concerned but he is a mischief maker in many countries, including America and of course he is all for a World Government in which he will be top dog. The whole Euro thing was a huge mistake. For instance, one cannot run an industrial Country such as Germany in the same way as you would run Greece, which is a tourist country and that is only one point. But George Soros is not to be trusted, that's for sure

  • Bobbie Booyse - 2012-02-12 22:59

    Dear Mr. Soros, considering your own country, the US has a National Debt of the tens of Trillions and that its Germany's money that have to keep paying to bail faltering European economies out -- I'd simply advice minding your own business.

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