Jens Weidmann knew his job wasn’t going to be easy. After all, Germany’s Bundesbank president owes his job to the fact that his predecessor, Axel Weber, had thrown in the towel in the midst of the euro crisis.
Mr. Weber resigned because he didn’t feel German Chancellor Angela Merkel was supporting him sufficiently in the fight to stop the European Central Bank from buying the government bonds of heavily-indebted euro-zone countries. He stepped down, followed by another ECB board member, Jürgen Stark.
Since Mr. Weidmann took over in May 2011, he has repeatedly experienced how lonely life can be as the Bundesbank’s representative on the governing council of the ECB, the body which sets interest rates and broader monetary policy for the entire 19-nation euro zone. With a reputation as the most hawkish of the ECB’s council, he has few allies. Again and again, Mr. Wiedmann has failed to prevent moves to expand monetary policy in the currency bloc.
That hasn’t stopped him from trying. Mr. Weidmann has spent the past five years fighting tirelessly against debt mountains and floods of printed money that he believes are a danger not just to Germany but to the euro zone at large. In an exclusive interview with Handelsblatt, he warned that those risks are only likely to grow over time.
But there’s also a reason he hasn’t stepped down like his predecessor. Above his own convictions as a central banker, there is one thing that’s more important to him: The reputation and independence of the ECB.