From “Conspiracy Theories Fly As Europe Struggles,” Floyd Norris, NYT:
“Imagine for a moment that two decades ago, a newly unified Germany set out to take over the European Continent, as the previous unified Germany had tried and failed to do half a century earlier. This time it would use money, not guns, to accomplish the goal.
“There is, let me hasten to note, no evidence of any such conspiracy. But if there had been, things might have played out more or less as they have.
“Conceivably, Germany learned three things from the 1992 experience [when Germany’s raising of interest rates forced other European countries to do the same, hurting their economies], and mapped out a course with those lessons in mind. First, absent fixed exchange rates, its export-oriented companies faced the risk of periodic competitive devaluations from the rest of Europe.
“Second, a currency union could help German exports if the euro’s value were held down by less competitive economies.
“Finally, if Germany adopted a low-interest-rate policy, and superlow rates arrived in European nations accustomed to high rates, banks could open the credit spigot and create a debt-financed boom in much of Europe. That would invite a mushrooming of imbalances. Ultimately, deeply indebted countries would face a crisis, one that they could solve only if they acquiesced to German policies and surrendered a large part of national sovereignty.
“The endgame may be approaching. Troubled countries are facing an increasingly clear choice. They can stay in the euro zone, and face years of endless recession. They can abandon the euro, perhaps bringing catastrophe but giving them the freedom to devalue their new currencies. Or they can accept the German offer: Surrender sovereignty. Accept German leadership and domination of a unified Europe. Then we will bail you out.” Emphasis added.