Robin Brooks’ diagnosis is sharp - but his remedy sounds more like a trade idea than a policy solution. The facts he marshals are troubling: German growth is weak, manufacturing and exports have lost momentum and high energy costs have gutted margins. Brooks has been explicit that a return of the D-Mark would, in his view, restore Germany’s adjustment tool.
That said, two reality checks are missing from his argument:
1. A German exit would blow up the single market and inflict catastrophic economic and political costs across Europe, including on Germany itself. The narrative that a unilateral currency break would be a clean fix ignores the trade disruptions, legal chaos and market volatility that would follow. Germany’s exporters and access to the EU market are pillars of its prosperity; walking away from the euro would not be a tidy reversal but a multi-year, multi-front wrecking ball.
2. Who benefits politically and commercially from pushing the “euro must die” thesis? Brooks’s past roles (Goldman Sachs FX strategist, IIF chief economist) matter because his views arrive from inside networks that trade, structure and profit from currency and risk markets. Goldman, like other big banks, has a long public record of advising clients and arranging bespoke transactions that profited from currency and sovereign-debt complexity (think the Greek swaps controversy). That episode is a concrete example of how big banks can design instruments that served client and bank interests while complicating sovereign finances.
So read Brooks with two lenses at once: technical and incentive. Technically, the euro area needs better fiscal sharing, investment, and energy policy, not a geopolitical divorce that would shatter the single market. Incentive-wise, proposals that would create massive FX moves are hardly neutral; they create huge trading, hedging and advisory opportunities for global banks.
Finally: Brooks’s argument also underplays where the real policy mistakes were made in Berlin. The Green-Deal transition and sanctions that removed cheap Russian energy weren’t inevitable macro shocks - they were political choices that redistributed costs onto industry and households and pumped up energy bills. Those policy errors, coupled with weak domestic demand and investment constraints, are a more convincing proximate cause of Germany’s malaise than the mere existence of the euro.
Bottom line: the euro has flaws, but the cure Brooks prescribes would be a cure worse than the disease. And when a proposal aligns so neatly with the commercial playbook of big banks, we should demand not just economic analysis but clear answers on who stands to gain.
