Analysis of Michael Lewis

According to Lewis’ article, It’s the Economy, Dummkompf, Germany is the only country who can save the Euro from collapse. According to Lewis, the Greeks are seen as the most unlikely people to pay back their debt. Germans, on the other hand, are the biggest funders for European nations and their biggest hope for future funds.

Because of this, it is understandable that the German people are frustrated at the situation developing with the Euro. The Euro was developed in part to quell German ambitions by tying its economy to the rest of Europe. And the irony is, that the rest of Europe seemingly is going to rely on the Germans to avoid collapse. In addition to this, Germans do not think that the Greeks have been behaving as they are in the financial situation they are in. German magazines ran headlines that read “Why don’t you sell your islands, you bankrupt Greeks!”.

Lewis goes on to explain that perhaps out of frugality, Hamburg is swarmed with German tourists. Here, he notices a book written by a distinguished anthropologist that explains the historical anality of the German people. He goes over the vast amount of German words relating to scatological themes. This is a very interesting use of language that helps relay the economy issue into more common terms.

Lewis then speaks with finance minister Asmussen. Asmussen claims that the Greek government has not been adhering to the regulations that they claimed they would when entering the Euro zone. Greece’s debt is high, but it’s deficits have not decreased as they were supposed to have. The biggest problem with a Greek default is that it may cause other European banks to fail.

Lewis also makes reference to the problems faced by the Irish economy in his article, When Irish Eyes Are Crying. In this article, he explains that the Irish were among the richest inhabitants of Europe only ten years ago. Today, one of Ireland's largest bank, Anglo Irish, is facing losses of 34 billion euros.

Two other large Irish banks, partially owned by the government of Ireland, are also facing massive losses; although they are revealing much less about those losses. These two banks lent massive amounts of money not only to Irish property developers, but also to Irish homebuyers. However, it is now the homeowners in addition to the banks that will have to cover the losses caused by the burst of the real estate bubble. This is eerily similar to the consequences of the easy lending policies practiced by banks and promoted by governments in the Unites States as well as much of the West.

However, Lewis seems to lay the entire blame on the bankers and those making the loans. If one were to look at the whole problem, one would notice that this debt crisis needs to be addressed by lenders, borrowers, and governments. To act as if the notion that home ownership is a natural right that should be guarenteed by banks and governments is not what led to this problem is foolish. Lewis seems to fall for this trap by stating that "even in an era when capitalists went out of their way to destroy capitalism, the Irish bankers set some kind of record for destruction." This is a logical fallacy, as it is not true capitalism that leads to government intervention to promote home ownership. Banks colluding with government to lower lending standards does not constitute capitalism, but rather corporatism.

I find that Lewis uses very interesting devices to convey what he means about the economy in common-man terms. For instance, "Ireland’s financial disaster shared some things with Iceland’s. It was created by the sort of men who ignore their wives’ suggestions that maybe they should stop and ask for directions, for instance." By this, Lewis uses an analogy to convey that these economic problems are essentially caused by the perpetuation of economic authorities refusing to acknowledge that their policies are counterproductive.

In conclusion, Lewis is very talented at taking complex issues and using common language and analogies to make these concepts much more accessible to those that may not be very familiar with these issues.