Resignation provides a Stark reminder of the divisions within the eurozone

The problems facing the eurozone have been underlined by the departure from the European Central Bank yesterday of its senior German representative, Jürgen Stark. Stark, who is in essence the bank’s chief economist, has quit its six-member executive board. The ECB is saying that he’s leaving for personal reasons but it is widely suspected that he’s really off because he can’t accept the bank’s policy of buying up the debt of embattled eurozone economies. 

Stark will almost certainly be replaced by another German. Given the current political dynamics there, it is almost certain that whoever succeeds Stark will take an equally dim view of the ECB purchasing bucket loads of ‘olive zone’ debt.  A situation where the largest euro-zone economy is opposed to the policy of the European Central Bank is unsustainable in the medium term.

The euro crisis is forcing Berlin to choose between its two post-war strategic—and moral—imperatives, European integration and sound money.