Boneheaded.

That’s how Paul Krugman, this year’s distinguished Nobel Prize laureate for economics, defined Germany’s response to Europe’s financial crises. Krugman is part of a vast chorus of economic gurus, journalists and politicians disgusted and enraged at Berlin.

“For the first time in my life, I am starting to feel twinges of anti-German sentiment,” Ambrose Evans-Pritchard, international business editor for the Daily Telegraph, wrote on Monday. “[E]ven Teutophiles who think that Germany has played an enlightened role for 60 years are losing patience with the antics of the finance ministry and Bundesbank, and with the dictatorial turn in Berlin’s EU strategy” (emphasis mine throughout).

European politicians are similarly enraged.

“France is working on it and Germany is thinking about it,” French President Nicolas Sarkozy jabbed recently in reference to Berlin’s sloth-like approach to solving Europe’s economic crisis. German Chancellor Angela Merkel’s habit of shooting down rescue efforts for Europe’s crashing economies has earned her the nickname Madame Non in France; in Britain, Frau Nein.

Across Europe, the impression is that Germany is fiddling while the Continent is burning.

Britain’s frustration with Berlin boiled over early last week when, ahead of Thursday’s EU summit in Brussels, Prime Minister Gordon Brown snubbed Merkel and invited only Sarkozy and José Manuel Barroso to London for pre-summit economic discussions. Press releases that claimed the snub was unintentional and denied reports of a rift in the EU were taken with a grain of salt. As Spiegel Online reported Thursday of last week, “Growing annoyance with Germany inside the European Union had hardly been the best kept secret in recent weeks.”

What’s going on? Why is nearly every European state furious at Berlin? More importantly, why is Germany stonewalling Europe’s rescue efforts? What does Germany expect to gain by infuriating its neighbors and isolating itself from the rest of Europe?

Europe’s economic chaos has received sparse coverage in America. That’s understandable: It’s hard to pay attention to the house burning across the street when your own house is going up in flames. Nevertheless, the economic fires roasting Europe’s economies are as deadly as those ravaging America’s economic house. In December, Europe’s manufacturing and service industries contracted at the fastest pace in a decade or more. Payrolls are falling. Consumer and executive confidence dropped last month to the lowest level in 15 years. Industrial production plummeted the most since 1993. Half of EU member states are running budget deficits; most others are right on the fence, and quickly eating into surpluses. Social unrest is now a reality, and the recent riots in Greece are fundamentally a result of Greece’s bankrupt economy and the government’s inability to solve its financial troubles. The Greeks are not alone; with recession striking Continent-wide, similar economy-precipitated crises are smoldering, particularly in Spain, Portugal and Eastern Europe.

Europe’s leaders are alarmed and scrambling to douse the flames. The problem lies with someone who is stalling these rescue efforts. Europe’s largest, most influential and best-positioned national economy disagrees with how its counterparts—particularly France and Britain, in addition to the European Commission—plan to put out the fires.

While London, Paris and Brussels seek the flamboyant American-style quick-fix, billion-dollar-bailout/stimulus-package approach, Berlin views that as reactionary and potentially dangerous. Instead of further rupturing national budgets by borrowing billions and haphazardly throwing money at the problem, Germany believes the bona fide solution lies in sound, cautious fiscal management that will solve the root cause of the problem.

“At a time when the global benchmark for decisive leadership boils down to the number of zeros that are attached to economic stimulus packages,” reported the New York TimesTuesday, “Germany has taken a different path.” Chancellor Merkel highlighted that path during a recent speech in the German region of Swabia, where she “lambasted the bailout mentality gripping Western leaders and lauded financial discipline, balanced budgets and the ethic of thrift …” (Washington Times,December 14). Every Swabian housewife knows the root cause of this crisis, she said: “You can’t keep on living beyond your means. … We are not going to participate in this senseless race for billions. We have to have the courage to swim against the tide.” Merkel was insinuating that German housewives know more about the cause of the economic crises than some European leaders.

Talk about bold.

Recently, Germany’s feisty finance minister, Peer Steinbrück, set off sparks during an interview with Newsweek. When asked what was wrong with the stimulus proposals being bandied about by Europe’s leaders, Steinbrück denounced the plans and said that the “speed at which proposals are put together under pressure that don’t even pass an economic test is breathtaking and depressing.” That was before the EU summit in Brussels where Europe’s leaders agreed to ignore EU rules limiting government borrowing and debt and decided to inject €200 billion, or 1.5 percent of the bloc’s gross domestic product, into European economies to bolster growth.

During the interview, Steinbrück specifically excoriated Britain for a recent tax cut: “Our British friends are now cutting their value-added tax,” he said. “We have no idea how much of that stores will pass on to customers. Are you really going to buy a dvd player because it now costs £39.10 instead of £39.90? All this will do is raise Britain’s debt to a level that will take a whole generation to work off.” Steinbrück called Britain’s efforts to kick-start its economy “crass Keynesianism,” in reference to the famous British economist who believed nations should spend their way out of recession.

Experts say that the German finance minister’s caustic swipe, aside from sparking outrage in Britain and being undiplomatic and divisive, also undermined the British pound and was designed to sap global confidence in the British government and economy. “The recession [in Britain] looks to be deeper than predicted,” wrote Philip Stephens in the Financial Times. He added,

[T]he last thing Mr. Brown’s government needs is a further weakening of confidence in sterling assets among international investors. It scarcely helps to have Germany’s finance minister declare that Britain’s strategy amounts to “crass Keynesianism.” … [The danger] has always been that international investors—in British government bonds, in particular—will take fright. Mr.Steinbrück seems to be egging them on in that direction.

Were Steinbrück’s remarks a direct attack on one of Germany’s largest competitors in the European Union? Of course they were! Why? Because, as Evans-Pritchard put it on Monday, there has been a “dictatorial turn in Berlin’s EU strategy.”

“[Y]ou can’t have a coordinated European effort if Europe’s biggest economy not only refuses to go along, but heaps scorn on its neighbors’ attempts to contain the crisis,”writes Paul Krugman.

Let’s not misunderstand. It’s not that Germany is not unwilling to deal with the economic chaos. Berlin has already passed a $31 billion economic package of its own—while still managing to balance its budget—and announced earlier this week that it is considering another stimulus package, to be released after the inauguration of Barack Obama. Over the past few days especially, it seems the Continent-wide uproar has caused Berlin to slightly soften its opposition to the let’s-slash-interest-rates-and-taxes, leverage-ourselves-to-the-hilt-and-pump-piles-of-money-into-our-economies approach to Europe’s economic crises.

Despite its relative softening, however, the German government still doesn’t believe that slashing taxes or handing out vouchers to promote spending are the primary solutions. Earlier this week, Merkel said that any stimulus package put forward will largely involve injecting money into the German economy by tackling infrastructure projects and promoting public works. Germany remains staunch in its refusal to bankrupt itself by injecting money into the failed economies of other European states.

But not everyone is furious at Berlin. Fiscal conservatives are praising Germany for its sound economic reasoning. “Germany is seemingly in good shape to weather the downturn,” wrote the Washington Times on Sunday, and is “in a better position than other nations such as the UK, Spain, Italy and France, for example, which have strained their budgets in attempting to stimulate the economy.” The Times concluded:

In the headlong rush to find an economic panacea, Mrs. Merkel is among few Western leaders keeping a cool head. As the EU moves forward on the Eastern Partnership and other platforms, she must continue to stand firm against the pressure to leverage Germany’s—and Europe’s—future with government bailout schemes.

It seems that Germany is giving the world a lesson in how it believes economic crisis ought to be handled! But we ought to dig a bit deeper to discern the true motives behind the German government’s resistance to the general stance of the rest of the EU on priming the pump of the European economies.

When it comes to economic management, the Germans are nearly the opposite of profligate Americans and some of their European counterparts. Where Americans want to spend their way out of a crisis, Germany prefers to save its way out. In general, the German national character is among the most thrifty, efficient and hard-working in the world. That’s partly why the German government abhors ridiculous spending and massive deficits. Even now, for example, Germany has a current account surplus of 7 percent of its gdp.

The prudent and thrifty national character of the German people is surely a reason for Germany’s fervent opposition to Europe’s rescue plan. But it’s not the primary reason!

History shows that Germany has a frightening tendency to exploit a crisis. In fact, as British political commentator Rodney Atkinson once told the Trumpet, “The German is expert in creating a crisis, then posing the solution, with an outcome designed to further his own ends.”

That’s what is now occurring in Europe!

Berlin’s stalling tactics are intensifying Europe’s economic crises. Europe-wide cooperation is essential if Europe’s bailouts and stimulus packages are to work. “[I]f Germany, the largest economy, refuses to go along,” Krugman said in an interview withSpiegel, “there will be no cooperation. Events have given Germany a strategic policy importance disproportionate to its size.”

This is a time-tested principle of European politics: Germany is creating a crisis with the intention of posing a solution that will further its own ends! By hijacking Europe’s plans to rescue its economies, Germany is essentially dictating European economic policy! Of course Berlin realizes it is infuriating its European neighbors. That doesn’t matter to it, because at the end of the day, whether European states like Berlin or not, this financial crisis will cause Europe to increasingly look to and rely on Germany as the savior of Europe!

Watch Germany. Watch Europe. Berlin’s strategy to establish itself as the leader of Europe is well underway—and there’s plenty more ground to cover! To properly understand what’s going on in Germany and in Europe, we must not only set our gaze on current events happening on the Continent, we must also set our minds on both history and Bible prophecy. This is what Christ meant when He said in Luke 21, “Watch and pray.” Watching world events will not save a person from the impending disaster. Our watching must be done in the context of urgent prayer and in-depth Bible study.

Actually, effective watching—that which leads a person to being so moved by the danger of the times in which he lives that he feels impelled to seek after God—is a function of prayer and how well a person knows the Bible and God’s prophecies regarding end-time events. To truly understand what’s happening in Europe, one must understand Germany in history and prophecy. If this subject genuinely interests you, it’s critical you read, in this order, The United States and Britain in Prophecy, Germany and the Holy Roman Empire and Who or What Is the Prophetic Beast?