The rise of extremist parties in Europe could lead countries to leave the single currency if far-right leaders were to gain power, a leading adviser to the German government has warned.
Ottmar Issing, who has held senior positions in the Bundesbank and the European Central Bank, said public anger at austerity measures served to make populist politicians more appealing – with potentially serious implications for the euro.
“Leaving is committing economic and political suicide. This would not exclude that it might happen,” said Dr Issing, who is chairman of a group advising the Merkel administration on financial reform. “I think it could only happen if a government was in such a disastrous situation that extreme parties over a period of time get a majority, and this can only happen on the basis of populism and not accepting any more measures that are needed.
“I think it’s a big challenge for the responsible parties in the middle of the spectrum to explain to the people . . . why these hardships are necessary.”
Dr Issing’s remarks to an audience in Berlin came days after an anti-immigration party won its first parliamentary seats in Sweden, a non-euro country. The success of the Sweden Democrats mirrors the advance of extremist parties within and outside the euro zone, as mainstream politicians worry about the cumulative impact of austerity measures to deal with the economic crisis.
Anti-Islamist Geert Wilders more than doubled his party’s seats in the Dutch elections in the summer, leading to political gridlock as the country’s leaders struggle to form a government without him. In Belgium, hardline Flemish separatist Bart De Wever claimed victory in a general election. Although he does not cast himself as far right, his uncompromising nationalism is a prime factor in the stalemate that has bedevilled the country’s politics.
In French regional elections last March, Jean-Marie Le Pen’s National Front seized 12 per cent of the first-round vote. In Italy, the xenophobic Northern League saw its tally in regional elections rise to 13 per cent. Hungarian ultra-nationalists Jobbik are also advancing, taking third place earlier this year in a general election.
Irish Times
