A Euro Sabbatical

by Hans-Werner Sinn Hans-Werner Sinn is Professor of Economics and Public Finance, University of Munich, and President of the Ifo Institute. 29.02.2012

Introduction

Many people regard debt relief and socialization of debts as the only way out. This help has been given. The recent agreement gave Greece relief of €237 billion ($316 billion), about 30% more than Greece’s net national income of roughly €180 billion euros. But such help only entrenches the wrong prices – and thus the economy’s lack of competitiveness. The debts will re-emerge like a tumor, growing year by year, while undermining the creditworthiness of stable eurozone countries.
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