In Defense of the German Saver
Negative interest rates have their uses, but the European Central Bank should be more mindful of the downsides.
A sign of comfort for the German saver.
Photographer: DANIEL ROLAND/AFPIf there is one thing the world should have learned over the last decade, it is that politics is usually more symbolic than pragmatic. A good policy attached to the wrong symbols can fail, while impractical or even irresponsible leaders can succeed by promoting popular symbols.
And yet this is a lesson we are still learning. Take, for example, the policy of the European Central Bank to charge negative interest rates, currently at -0.4%. Practically speaking, this does not bring big macroeconomic gains, and as symbolic politics it is proving disastrous — most of all in Germany, where it is turning people against the Eurozone.