Jens Weidmann, 46, has been at the helm of Germany’s central bank, the Bundesbank, since 2011. As guardian of the country’s monetary policy, he has more than once clashed with Mario Draghi, head of the European Central Bank. In particular, Mr. Weidmann, who is also a member of the ECB’s governing council, has opposed Mr. Draghi’s policy of quantitative easing. While he has received backing from the German government, Mr. Draghi has gotten his way in Europe: This Monday, the Italian’s trillion-dollar bond-buying program has kicked into gear.
Mr. Weidmann sat down with Uwe Jean Heuser and Mark Schieritz to talk about the new flood of money, the deeper causes of the crisis and political backing in times of confrontation.
Die ZEIT: Mr. Weidmann, there’s a quote we’d like you to hear.
Monetary policy is about phasing out the non-standard measures introduced in response to the crisis and drawing a clear line between monetary policy and fiscal policy. Do those words ring a bell?
Jens Weidmann: Yes, they certainly do.
That’s what you said when you took office more than three years ago. What’s happened in the meantime?
Plenty of things have happened. Tension has ebbed and flowed as the euro area crisis has progressed, but those words are no less relevant for the future path of monetary policy than they were back then.
The European Central Bank has begun buying up government bonds, so we don’t appear to be anywhere near phasing out the measures introduced to tackle the crisis right now.
That’s true. But I have repeatedly pointed out that the crisis is more like a marathon than a sprint – and that it’s going to take a great deal of time to overcome the root causes of the crisis. So it’s very tempting indeed to dump the problem at the door of monetary policymakers. But there’s no simple way out of the crisis, and firing up the printing presses in particular won’t eliminate the problems that sparked the crisis in the first place.
But no one is listening to you.
I wouldn’t say that.
Time and again, you’ve been outvoted in ECB governing council meetings, most recently in the decision a few weeks ago to purchase government bonds.