Could the rise of Golden Dawn save the Eurozone?

In Germany's nightmares, inflation leads to Nazis. But now that there are Nazis anyway, perhaps we'l

More growth would obviously do a lot to help the Eurozone. For Spain and Italy, a healthy level of growth alone might be enough to pull them out of crisis mode. For Greece, more would have to be done, but it would be a strong start.

Unfortunately, that growth is being at least partially quashed by the outspoken desire of Germany (and thus the European Central Bank) to keep inflation low. High inflation in Germany would overcome the problem that the Eurozone currently has where wages in Spain, Greece and Portugal need to fall relative to those in the core, but are showing no signs of doing so.

Why is Germany so against inflation?

Well, the fact that high inflation would negatively impact the German economy is obviously a large part of it. But equally important is the experience of the German people in the 1930s. Put bluntly, there is a fear in Germany that high inflation leads to fascism.

Which is why the rise of Greek neo-nazis Golden Dawn (whose flag looks like an alternate-universe version of the swastika) could be a blessing in disguise. Albeit a really, really good disguise. Because the one thing Germany hates more than inflation is Nazis.

Greece has price of a little under 2 per cent. There are a lot of things causing the rise of their homegrown Nazis, but hyperinflation is not one of them. So right now Germans are seeing their worst nightmare happen even though they managed to keep inflation low across the Eurozone.

Could this mean that they'll back off slightly over their overbearing desire to keep inflation low?

Well, so far there isn't a huge amount of encouraging news. On Wednesday, the FT did report that:

A future German inflation rate above the eurozone average could be part of a natural adjustment process as crisis-hit countries pulled themselves out of recession, the Bundesbank argued in evidence to German parliamentarians.

Except that that was only a couple of days after the Bundesbank president wrote in the same paper that:

To prevent the recovery stalling, demands have been directed at the Eurosystem to deliver yet lower interest rates (or at least to forego raising them), yet more liquidity and even larger purchases of assets.

However, the assumption underlying such well-intentioned advice does not hold up to closer scrutiny.

So they don't appear to have been spooked into monetary expansion anytime soon. Perhaps Golden Dawn aren't really a blessing in disguise after all; sometimes, to misquote Freud, a Nazi is just a Nazi.

The leader of the fascist Golden Dawn party. Photograph: Getty

Alex Hern is a technology reporter for the Guardian. He was formerly staff writer at the New Statesman. You should follow Alex on Twitter.

Carl Court/Getty
Show Hide image

To stop Jeremy Corbyn, I am giving my second preference to Andy Burnham

The big question is whether Andy Burnham or Yvette Cooper will face Jeremy in the final round of this election.

Voting is now underway in the Labour leadership election. There can be no doubt that Jeremy Corbyn is the frontrunner, but the race isn't over yet.

I know from conversations across the country that many voters still haven't made up their mind.

Some are drawn to Jeremy's promises of a new Jerusalem and endless spending, but worried that these endless promises, with no credibility, will only serve to lose us the next general election.

Others are certain that a Jeremy victory is really a win for Cameron and Osborne, but don't know who is the best alternative to vote for.

I am supporting Liz Kendall and will give her my first preference. But polling data is brutally clear: the big question is whether Andy Burnham or Yvette Cooper will face Jeremy in the final round of this election.

Andy can win. He can draw together support from across the party, motivated by his history of loyalty to the Labour movement, his passionate appeal for unity in fighting the Tories, and the findings of every poll of the general public in this campaign that he is best placed candidate to win the next general election.

Yvette, in contrast, would lose to Jeremy Corbyn and lose heavily. Evidence from data collected by all the campaigns – except (apparently) Yvette's own – shows this. All publicly available polling shows the same. If Andy drops out of the race, a large part of the broad coalition he attracts will vote for Jeremy. If Yvette is knocked out, her support firmly swings behind Andy.

We will all have our views about the different candidates, but the real choice for our country is between a Labour government and the ongoing rightwing agenda of the Tories.

I am in politics to make a real difference to the lives of my constituents. We are all in the Labour movement to get behind the beliefs that unite all in our party.

In the crucial choice we are making right now, I have no doubt that a vote for Jeremy would be the wrong choice – throwing away the next election, and with it hope for the next decade.

A vote for Yvette gets the same result – her defeat by Jeremy, and Jeremy's defeat to Cameron and Osborne.

In the crucial choice between Yvette and Andy, Andy will get my second preference so we can have the best hope of keeping the fight for our party alive, and the best hope for the future of our country too.

Tom Blenkinsop is the Labour MP for Middlesbrough South and East Cleveland