Eurozone crisis: Germany, the hobbled giant
3 November 2011
It dictates the agenda of EU summits, defines the rules, makes an entire continent wait, and always ends up imposing its will. With the euro crisis Germany finds itself alone at the head of the Union. But is it up to this new role? Excerpts.
One proceeds with political power like with a bank account of several million euros: one doesn’t mention it. One just has it, that’s all. Germany has done well out of the game for many decades: important, but never having to waste words about it. And when things got tricky, all German governments have been past masters at the art of making themselves small, politically. But that's over. Today, everyone is talking about Germany’s influence.
It’s been happening in Brussels these last few dramatic weeks. “Does Germany want to tighten the reins on the Greeks even more?” a representative of a small EU country was asked. He took a deep breath before answering: “The Chancellor is a very powerful woman.”
More he wouldn’t say. In the opinion of an Italian diplomat, Merkel is powerful not only because she represents the largest country in the EU, but “also because she is the most serious of the heads of government. The others are afraid of her.” Romano Prodi said that, in Europe, she is the “lady” who makes the decisions, “and then the French president gives a press conference to explain them.”
The rescue of the euro could come to rest entirely on Germany’s shoulders because it’s the only economy that seems strong enough to hold up the others. Since the summer of 2009, when the rest of the eurozone began to slide deeper into crisis, the economic power of Germany has grown stronger: its GDP rose by nearly seven percent, and exports went up by over 25 percent.
But Germany is exercising this hegemony against its will. It’s not prepared to play this role, and it never aspired to it either. Making cars and quality machines is part of Germany’s self-image. But playing a leading role on the international scene? The rescue of the euro not only asks much more of Germany than it wants to give. It may ask for more than it can give.
Franco-German couple - a polite fiction
The term “hegemony” comes from the Greek word hegemon, which means “leader”. Even today a slight shudder runs down the backs of elderly Germans when they hear talk of German supremacy. History made Germany force the unification of Europe without standing at the forefront of the process.
Then, after reunification, sovereign Germany concealed its power within the monetary union. The euro was brought in according to German designs: with a central bank that would be just as independent as its own Bundesbank, and with as little inter-state coordination as possible. But Germany did forego taking on important posts. That was, rather, left to the French.
France has long played the role of the leading political power, while Germany stood out economically. But today France could also pose a problem for Germany within the eurozone.
According to surveys, two thirds of Germans feel no direct effect of the euro crisis. In France, though, it’s the other way around. No wonder: France needs more jobs. Since 2000, half a million jobs have been cut in the industrial sector alone, and the jobless rate now stands at ten percent. The old rule that without France, Germany could hardly make a move in the EU may still hold true today. But the situation has changed. And the French are in desperate need of the Germans, much more so than the other way round. The old Franco-German couple, writes the Financial Times somewhat snidely, is nothing but a “polite fiction”. It is Germany that is playing the de facto leading role in Europe.
One doesn’t become a good leader, however, by imposing one’s position after long and tough negotiations. A good leader acts quickly and early – at the moment when the need to be rescued, and not just when the situation becomes dangerous to himself. A good leader has a clear idea not just of what shouldn’t be happening, but of what should happen in the future.
Furthermore, is Germany capable of doing what it should and must do – but doesn’t want to? The Federal Republic has grown as strong outside the country as it has grown weak with paralysis at home. While in Brussels the fight is for the future of the euro, in Germany the fighting is between the Bundestag and the Bundesrat, the coalition and the opposition, the government and parliament. This has been on display in the debate on the enlargement of the European Financial Stability Facility, which has dominated Germany for the past two weeks.
German meticulousness irritates
While the CSU regularly gets hysterical to compensate for its dwindling influence, the FDP, the other coalition partner, is fighting tooth and nail simply not to disappear. In normal times, public opinion and the opposition are the most dangerous opponents of a government. In Germany today, the worst enemy of the coalition is usually the coalition itself.
The system of the Federal Republic, which historically has been defined to set limits on, control and fetter its own power, is annoying the entire continent: the German paralysis is becoming unbearable for Europe, which must wait on the decisions of the Bundestag, the FDP or CSU – or even on some regional vote.
Domestically, the government is being asked to find a compromise between efficiency and democracy and to allow participation of the parliament, which is keen to have its say. Externally, at the European summits, the federal government seems bound hand and foot.
Other countries also have constitutional courts, federal systems or systems of proportional representation that lead to coalition governments. Unlike Germany, though, none has all three at once, and in few are they so important as in Germany.
It's not just the German meticulousness that irritates the other Europeans. It’s also the idea that Germans are using this meticulousness strictly to their own advantage. What is all this doing to Greek democracy? How long will the Greeks still agree to have elected officials who have neither the ability nor the right to make decisions? How can the Union be popular if democracy is placed on “stand-by” mode? In these times of crisis, these questions are falling by the wayside. But hegemony also means commitment to others.
Translated from the German by Anton Baer