The supposedly harsh bailout terms imposed on Greece this weekend have unleashed a torrent of Germany-bashing. Already routinely — and unflattering — compared with a despicable German leader from the past, Chancellor Angela Merkel is now accused of staging a “coup” in Athens by demanding that it live up to the commitments it made in the past.
Much of the criticism is too ludicrous to be repudiated. But to the extent that it reflects a growing unease in Europe with German leadership, it warrants attention.
For one thing, Germany is not as forceful as its detractors maintain. And when it is, that’s not a bad thing.
A German victory?
Starting with overestimating German power: It’s worth pointing out that its leaders went into a European Council this weekend ready to eject Greece from the euro and came out supporting a third bailout.
As Gideon Rachman put it in the Financial Times this week, “If that is a German victory, I would hate to see a defeat.”
The German government has just agreed, in principle, to another multibillion-euro bailout of Greece — the third so far. In return, it has received promises of economic reform from a Greek government that makes it clear that it profoundly disagrees with everything that it has just agreed to. The Syriza government will clearly do all it can to thwart the deal it has just signed.
Only one in two Germans still favor keeping Greece in the euro. Even fewer are under any illusion that the country will manage — this time — to put its house in order.
The point of the previous bailout terms was to make Greece more like Germany: competitive, frugal, hardworking and incorruptible. That has failed. Seven years of economic crisis and five years of support from other European countries and the International Monetary Fund have not changed the Greek mentality.
If their voting behavior is any indication, the majority of Greeks never accepted they were ultimately responsible for the situation they found themselves in.
The German-led rescue operation may have only exacerbated the Greeks’ sense of entitlement and self-victimization. Rather than accept the need for liberal economic reform and greater self-reliance, they blame their creditors for imposing cruel austerity measures and believe they deserve help, in the name of European “solidarity,” without doing anything in return.
Warning to others
At this point, insisting on spending cuts and reforms is less about saving a country many Germans — including Merkel’s hawkish finance minister, Wolfgang Schäuble, and a growing number of Christian Democrats — see as a lost cause. It is about showing other potential laggards in the eurozone that there is no going back; that an election in one country cannot supersede the democratic decisions made by the bloc as a whole (as Greece’s ruling Syriza party seemed to think); and — perhaps most importantly — that there is a limit to German patience.
François Heisbourg, an advisor at the Paris-based Fondation pour la Recherche Stratégique, argues in the Financial Times that by openly contemplating a Greek exit from the eurozone, “Germany has demonstrated that economics trump political and strategic considerations.”
Maybe. But that has been a long time coming then.
For decades, the Germans tolerated the “French” vision, which was that the numbers don’t have to add up as long as there is the political will. The Germans were willing to make up the difference for political reasons. They subsidized French farmers and industries and got the single market in return. Economic union was supposed to lead to political union over time.
Now that the French president, François Hollande, is proposing to turn the eurozone into a political union with its own budget and parliament, the Germans are doubtful. They wonder if it’s worth paying for the integrationist pretensions of the French and their friends in the south anymore when their rhetoric about ever-closer union may be just that and the real aim seems to be duping the Germans into permanently subsidizing the lifestyle of Mediterraneans in a much-dreaded “transfer union.”
The worst to come out of the latest Greek crisis, argues the Frankfurter Allgemeine‘s Berthold Kohler, is that it has exposed this split between France and Germany, traditionally the joint engines of European integration.
If Europe’s two leading powers no longer see eye to eye on the reforms that are needed in the EU, the future looks bleak indeed.
To be fair, the Franco-German parity that was at the heart of the European project for much of the twentieth century ended decades ago. Since Germany reunified in 1990 and sponsored the entry of former East Bloc states into the “West” — rebuilding a Mitteleuropa that the Cold War had shattered — France has played a secondary role.
Germany was — and is — content to keep up the fantasy that it is only one half of the entity that rules Europe. When France (and Italy) resisted ejecting Greece from the euro this weekend, Germany, despite having the support of the rest of the bloc, relented and agreed to a third bailout. It is still uncomfortable throwing its weight around.
At the same time, Germany is clearly the dominant power in Europe and the German left is starting to get nervous about it.
Return of power politics
Der Spiegel, a weekly that has long been critical of Merkel’s seemingly unambitious, step-by-step policy for saving the euro, laments that her government “has destroyed seventy years of postwar diplomacy on a single weekend.”
What happened in Brussels over the weekend was the return of the power politics of the nineteenth and twentieth centuries in which the strong impose their will on the weak.
The leftish Süddeutsche Zeitung called the chancellor “Europe’s new enemy” and said, “The monetary union is not working.”
Sven-Christian Kindler, the opposition Green Party’s budget spokesman in parliament, insisted that Merkel had made an historic mistake. “For the first time in sixty years, Germany has demanded less Europe rather than more,” he said.
The over-the-top rhetoric reveals a left-wing anxiety that Germany might return to its old ways.
Adenauer, not Bismarck
It is unlikely to. As the Atlantic Sentinel has argued, the country’s violent twentieth-century history necessitated a radical break with the past and a total rethinking of national values after the end of the Second World War.
Bild, the Germany’s top-selling tabloid, may call on Merkel to channel the “Iron Chancellor” and show the Greeks the door, but it is not the ghost of Otto von Bismarck that informs policymaking in Berlin. It is the example set by the country’s first postwar chancellor: the dull but competent Konrad Adenauer. Merkel adopted his 1957 election slogan when she promised the Germans “No Experiments” in 2013.
Germany doesn’t want power. It doesn’t want to dominate Europe. But it does and it has to.
Germany has the largest population in the European Union with almost twenty million more people than France. It has the bloc’s largest economy, accounting for over 20 percent of Europe’s yearly economic output. It contributes disproportionately to European solidarity funds. And Germany’s views largely overlap with those of member states in Central and Northern Europe. No one else is in a better position to lead.
If the last seventy years are any indication, Germany will (continue to) do so cautiously and — Southern European stereotypes notwithstanding — tolerantly.
Breaking the rules
German leaders like Merkel seek consensus and allow the “rules” their conservative voters care about to be broken if it suits the political interests of a united Europe.
Germany did so in 2005, when it and France exceeded the bloc’s deficit ceiling without consequence.
It did again in 2010 and 2011, when it reneged on the bloc’s “no-bailout” agreement to rescue Greece, Ireland and Portugal.
And it has overlooked the broken promises of Greece and the repeated fiscal treaty violations of France, Italy and Spain in the years since in order to keep the currency union together.
What is changing is that “Europe” is becoming almost a normal political issue in Germany. Relieved of World War II guilt, the German right feels it can be more critical of big-state, universalist ambitions in Brussels.
This is not an unhealthy shift. European integration should not be a goal in itself. Federalists need to be restrained if there is to be a “Europe of nations” — which was the aspiration of not a German but a French leader: Charles de Gaulle — rather than a United States of Europe.
A Germany that is more levelheaded about where the European Union should go and more honest about what it can do is in everyone’s best interest.