Former Bundesbank head Tietmeyer, who paved way for euro, dies at 85

Former Bundesbank president Hans Tietmeyer, an elder statesman of European monetary policy who survived an assassination attempt in 1988, has died at the age of 85, a spokeswoman for the German central bank said on Wednesday.

Tietmeyer was instrumental in establishing independence and price stability as pillars of Europe’s central bank, principles central to the eurozone contract when the single currency was introduced in January 1999.

President of the Bundesbank from 1993 to 1999, he was a major driver of preparations for European monetary union and the establishment of the European Central Bank.

He helped stamp the Bundesbank’s brand of money-oriented inflation fighting on the fledgling central bank and also took on the German government over plans to revalue gold reserves to shore up Germany’s budget position.

Tietmeyer believed that while the ECB should create a foundation for a healthy economy by establishing price stability, member countries had to do their share to maintain competitiveness and sustainable growth.

“Germany and Europe have much to thank Hans Tietmeyer for,” former ECB president Jean-Claude Trichet said in a speech at a ceremony for Tietmeyer in March 2010. “He was resolute in ensuring that the euro would be a stable currency.”

From 1993 until his retirement in 1999, Tietmeyer earned a reputation as a principled pragmatist and skilled politician with a mastery of detail and a commitment to what he called stability culture.

Central to Tietmeyer’ thinking was the theory of social market economy prevalent at the Economy Ministry in the 1950s and 1960s under the tutelage of Ludwig Erhard, architect of the country’s post-war economic miracle.

In the run-up to the economic and monetary union, Tietmeyer warned repeatedly that countries joining would face painful adjustments if it was to work. “Without adequate prior economic convergence, the path toward monetary union is hugely risky,” he said in Die Welt in December 1991.

Born on Aug. 18, 1931, in the small town of Metelen, Tietmeyer was one of eleven children.

As a child, Tietmeyer cultivated a passion for table tennis – The Economist magazine once called him “Mr Ping Pong” – and grew up a devout Catholic. He briefly studied philosophy and theology before switching to economics and social science.

Tietmeyer’s high profile and tough policies made him a target for left-wing extremists. He survived an assassination attempt in 1988 when his assailant’s gun initially jammed, but 10 bullet holes were later found in his car.

The Red Army Faction later claimed responsibility

Tietmeyer joined the Bundesbank in 1990 and oversaw the transition into the euro era.