It was late April 2017 when the penny finally dropped in Berlin. Until then, the assumption in Germany had been that despite 10 years of virtual stagnation and unemployment at 14%, one of the mainstream parties would emerge victorious in the French presidential elections due the following month.
Yet, with the campaign in its final stages, opinion polls suggested Marine Le Pen, leader of the extreme rightwing Front National, was on course to become the next president of France. Le Pen's message was simple. France should leave the euro, run its own economic policy along protectionist lines and have a blanket ban on immigration.
How did it come to this? For the past five years, ever since the election of François Hollande as socialist president in 2012, Germany had called the shots in Europe. Hollande's early attempts to forge an anti-austerity coalition with Spain and Italy quickly came to nothing and by the late summer of 2014 the French president purged his government of those on the left of his party calling for growth to be given a higher priority than reducing the budget deficit.
Angela Merkel, the German chancellor, saw this as the moment that Hollande finally grew up. She praised his commitment to budgetary rigour and structural reform. France, she said, should prove itself to be as committed to reform as Spain, Europe's poster child for austerity in the tough zero-growth year of 2014.
French Keynesians argued in vain that Spain was following the same beggar-thy-neighbour route pursued in the 1930s when countries sought to grab a bigger share of a shrinking market by devaluing their currencies and putting up tariff barriers. Spain had followed the German prescription to the letter. It cut wages in order to make Spanish exports more competitive, but the knock-on effect was to make life more difficult for French and Italian producers.
Almost halfway through his presidency in August 2014, Hollande had yet to preside over two successive quarters of positive growth. The economy had flatlined in the first two quarters of the year and the jobless rate remained stubbornly above 10%. Hollande's approval rating had slumped to 17%.
What France needed in the summer of 2014 was a more aggressive monetary policy from the European Central Bank and for Berlin to announce a Marshall Plan for Europe. What it got was more of the same, with few of the rough edges knocked off. The policy errors of the late 1920s and early 1930s were repeated, resulting in longer dole queues and rising levels of poverty. Parties on the extreme left and extreme right were dismissed as irrelevant. But support for them grew. And grew.