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Uber Alles? Not So Fast!

  • Francesco M. Bongiovanni
Chapter

Abstract

A pillar of rectitude, stability and a star performer, Germany is not all that it seems. Its economy has structural weaknesses. It assumed the moral high ground in the Greek crisis yet Deutschbank and Volkswagen are spectacular examples of two iconic German companies caught cheating on a world scale. The mantle of leader of Europe has fallen on it but Germany has by and large promoted its own narrow self-interest, often to the detriment of its European partners. Following the autumn 2017 elections, a new element of political uncertainty and instability entered Germany’s political scene. At a time when Europe needs to embrace courageous reforms, the only thing that may be worse than a strong Germany is a weak Germany.

A Benign Hegemon

It is difficult not to admire Germany. Germany gave us Bach, Einstein, Beckenbauer, Mercedes-Benz, Oktoberfest and Schiller, and won yet another soccer World Cup in 2014. It makes the world’s best cars, managed the impossible feat of absorbing its poorer Eastern half and reformed itself to embrace globalization and become the world’s number one exporter. It enjoys a ‘feel-good economy that’s proved more egalitarian than its European peers’.1 It is an economic powerhouse dwarfing the rest of Europe and batting in the same league as the USA and China. A benign power and a moderate democracy championing soft power, Germany seems to excel at everything it does. Its strength and reputation stem from various sources including stability, a moderate stance in world affairs, the general perception that Germans are serious, reasonable, disciplined and have their heads on their shoulders, and, most of all its economic prowess. The ‘German Question’ has, however, haunted European politics since Bismarck unified Germans into a nation-state in the late nineteenth century. It was larger, more populated and more powerful than any of its neighbours. Alluding to the Cold War reality that saw Germany divided by the infamous Berlin Wall into a western and an eastern half, François Mauriac joked that he loved Germany so much that he was happy to have two of them. A cosy pas de deux featuring France and Germany used to define the post-Second World War European agenda, with France hiding its weakness behind Germany and Germany hiding its strength behind France. This state of affairs provided some form of balance and stability to European matters. Today this paradigm is no more. Due to its own success as much as to the rapid decline of France and the recent British estrangement, Germany is alone in the driving seat. Former US Secretary of State Henry Kissinger who famously complained he didn’t know which number to dial if he needed to ‘call Europe’ finally has his answer: +49. The new reality of German hegemony is already shaping the future of Europe and not necessarily for the better. That much became obvious from two monumental challenges Europe found itself confronted with in recent times, the eurozone crisis and the refugee crisis. In the course of both crises Germany made decisions and everyone else fell into place, with results that were far from satisfactory. In all fairness let us keep in mind a simple fact: there are no pan-European politicians. Germany has its own interests just like any other nation-state. The German Chancellor is elected by Germans and, while the rest of Europe is doubtlessly important to German hearts, the Chancellor’s job is first to promote what she or he perceives as the interests of Germany itself. Germany’s position is firmly entrenched as the dominant European power and the EU ‘centre’ is weak (not weak enough said the British). Brussels’ politicians are, after all, mostly glorified bureaucrats with a small EU budget to play with and the power of utmost legislative nuisance, which they wield with great pleasure. Consequently for the foreseeable future the de facto leader of Europe will be elected by the German people.

For all its prowess Germany has recently used its dominant European position to dictate key European policies, often with disastrous results. Germany’s diagnosis that the eurozone crisis was of a fiscal nature was plain wrong. It led to the imposition of severe austerity measures across the board in troubled countries. As a result they were condemned to depression, high unemployment and ever-rising debt burdens. The refugee crisis was another instance of Germany unilaterally exercising its hegemonic power with dire consequences for itself and the rest of Europe. As we have seen, Germany’s generous offer to take in masses of migrants turned out to be a hasty, emotional decision that was not well thought out. It precipitated a crisis with side-effects that included Brexit and the death of Schengen. What emerges from these examples is a Germany that may not necessarily relish its newfound leadership yet no longer shies away from asserting its power and imposing its views on others, and not necessarily with good results.

Annoying Details

The myth of German rectitude was spectacularly debunked by the revelation of vast cheating operations at the iconic company Volkswagen and at another icon, Deutsche Bank. Germany claimed the moral high ground throughout the eurozone crisis, proclaiming loud and clear that the Greeks deserve to suffer because they cheated. Well, sorry to break the news, Angela, but Volkswagen and Deutsche Bank have been caught cheating on a large scale, and they are not exactly Greek. The giant German car manufacturer that owns brands such as Volkswagen, Audi and Porsche was hammered with some 22 billion USD worth of fines for having equipped its diesel cars with software purposely designed to deceive US emission and pollution controls. As a result, over 600,000 cars were recalled in the USA.2 In 2017, Volkswagen was poised to recall another 281,000 cars in the USA, this time for purely technical reasons related to malfunctioning fuel pumps.3 Merkel herself recognized that the auto sector has ‘seen a great loss of trust’.4 One could be excused for finding the recent criticism of the country’s car industry voiced by Merkel and other government figures a bit hypocritical, given the very cosy historic relationship between Germany’s two main political parties (Merkel’s CDU and Schulz’s SPD) with the car industry. Also given that Merkel (who had anointed herself with the title ‘automobile chancellor’ before her 2013 re-election and whose political party received a 700,000 euro donation from the Quandt family, who happens to own part of BMW) fought in Brussels against a ceiling on gas emissions proposed by the EU. Also given that no concrete measures have been proposed to rein in the auto industry5 which employs over 800,000 people in Germany alone.6

Deutsche Bank’s woes were known for quite some time. Falling income due to low lending revenues in an age of low interest rates may have contributed to the institution’s increasingly adventurous posture abroad. The massive hiring of risk-prone investment bankers in its US operations two decades ago may have compounded the problem. Yet, not only did the bank embark in questionable, high risk operations but it knowingly defrauded investors for years and on a large scale. Among the many criminal lawsuits it was faced, Deutsche Bank pleaded guilty in 2015 to charges of rigging Libor, resulting in a 2.5 billion USD fine from authorities in the USA and the UK.7 It was given another 14 billion USD fine from the US Justice Department a year later, due to the bank’s fraudulent practices in relation to mortgage backed securities.8 Yet in the financial industry crime often pays and in the USA Deutsche Bank was bailed out by US taxpayers during the latest financial crisis with assistance loans aggregating over 350 billion USD: about twice what Lehman Brothers received. The bank’s profitability in recent years has been dismal. It lost almost 7 billion euros in 2015.9 It ‘posted a net loss of 1.9 billion euross in the final quarter of 2016 as legal costs for past misdeeds weighed heavily on results’.10 Its stock price crashed and the IMF warned in 2016 that the institution had become the ‘world’s most important net contributor to systemic risks in the global banking system’.11 With 1.8 trillion euros in assets (equivalent to almost 60% of Germany’s GDP) and more than 100,000 employees,12 the bank was obviously too big to fail. Some observers said that Germany could be expected to rescue the bank in which case it would be doing what it has prevented other European countries from doing with their own failing banks. During 2016, speculation was rife. Rumours ranged from a possible merger with the partly state-owned Commerzbank to Berlin’s potential use of a loophole according to which a state can recapitalize a bank as a ‘preventive measure’ with public money if the bank fails a stress test (which could be a fake test). Germany has insisted in the past that the bondholders and depositors of banks in Europe should be hit before any state aid is allowed and pushed for this policy to be enshrined in EU Bank Recovery and Resolution Directive rules. Yet, if it feels it would serve its own interests, Germany is likely, once more, to break the rules. This would be to the great pleasure of other troubled countries who would finally feel free to do the same, signifying the end of any serious efforts to improve a financial sector badly in need of reform all over the continent. Berlin’s immediate priority was, unsurprisingly, to put pressure on the USA to reduce the huge fine. At the end of 2016 the bank announced that it had reached a settlement with the US Justice Department at 7.2 billion USD. In 2017 the bank seemed to be slowly improving its position. It was poised to downsize some of its operations yet remained plagued by serious problems. For a country that prides itself on following rules and being the epitome of rectitude it seems Germany is on its way to be Uber Alles at the top of the podium for receiving the world’s biggest fines for cheating and breaking rules.

It Isn’t All that It Seems to Be

In recent years German leaders have been trumpeting the success of the German economic model. There are ample reasons to rejoice. Germany has achieved the remarkable feat of absorbing its much poorer eastern half following the fall of the Berlin Wall. It injected over 2 trillion euros which resulted in a remarkable convergence of living standards between West and East although a gap remains. Interestingly enough it is between the North and the South that the gap is now growing. The German south is becoming richer and its north poorer (the northern states collectively have 371 billion euros of debt and annual exports worth 391 billion euros; the southern states collectively have 170 billion euros of debt and annual exports worth 559 billion euros).13 This worrisome trend led Demographic Risk Atlas, a study of population trends, to suggest that Germany’s north-south divide could become larger than Italy’s.14 To its credit, Germany enjoys an almost full employment economy (3.9% unemployment only), its GDP has kept growing since 2005 (by mid-2016, the economy had grown 2.1% year-on-year),15 its total debt level in 2017 is the same as it was in 2005 and its fiscal position shows a positive balance.16 The German economy is the envy of many. Its economic success is to a great extent a reflection of the success of the Mittlestandt: a universe of well-run family enterprises that restructured themselves to jump on the globalization train and propelled the country to become the world’s number one export machine (with no little help from an undervalued euro). Yet it is easy to forget that—despite its commendable AAA rating—prior to its respectable growth performance, Germany had effectively seen little GDP growth since just before the financial crisis in 2007. Its average growth rate (adjusted for inflation) of only 0.8% from 2007 to 2015 led American economics Nobel laureate Joseph Stiglitz to say ‘this is not the performance of a champion!’. It is also easy to forget that German productivity growth has continuously declined over the past 20 years (just as it has done in France and Italy), while capital expenditure as a percentage of GDP has also been declining (again, the same goes for France and Italy).17 The infrastructure investment rate is the lowest of any big developed economy (The Economist blames the Merkel ‘government’s obsession with balanced books’ which ‘has led it to invest too little’).18 None of these facts are good news for the future direction of economic competitiveness. Germany’s arcane tax code, one of the most complicated on the planet, contributed to its ranking behind Macedonia in the 2015 World Bank country classification of ‘Ease of doing business’. German rankings in the World Economic Forum’s global competitiveness survey for road quality, railway quality and internet bandwidth visibly worsened from respectively 5th, 4th and 12th in 2010–11 to 16th, 11th and 29th in 2017.19 The German service sector, representing 60% of the economy, remains mired in the past and ‘an insecure, low-wage service sector is growing’.20 It comes as a surprise that, according to Eurostat, 9.7% of the German employed population was living below the poverty line (defined at approximately 940 euros per month) in 2014 (an increase compared to 2006’s 7.5%): above the European average of 9.5%.21 Since Angela Merkel assumed power in 2005 the percentage of the population below the poverty line (established at 60% of median income) has more than doubled in ten years.22 According to The Economist,

‘The lowest-paid 40% of German workers are earning less in real terms than 20 years ago. Food-bank use is up. The rate of investment has been dropping since 2012. Bridges creak and potholed roads challenge even the best-engineered suspensions’ […] Dirty coal is filling some of the gap left by the closure of the country’s nuclear plants as part of an ‘energy transformation’; the country’s carbon-dioxide emissions are up […] Mrs Merkel bears a good bit of the blame for all this […] after her 12 years as chancellor the tax system remains strikingly unprogressive and state governments’ ability to invest in infrastructure or anything else is limited by an excessively rigid ‘debt brake’.23

The German economy is on one hand the envy of the world yet remains, in certain respects, a myth that rests in no small part on depressed wages and on an undervalued currency. Disciplined German workers have stomached wage restraint for more than a decade (wage restraint acts like an artificial internal devaluation, making German goods even more competitive and, by the way, Germany was quick to criticize Ireland’s ‘tax dumping’ but will not tolerate its wage restraint being labelled as ‘salary dumping’). Similarly, the euro will probably remain undervalued for Germany, helping its exports. These factors can be expected to continue fuelling growth for the foreseeable future: Germany seems to be living through a magic moment.

The Missing Goods

Legitimacy of leadership in international affairs derives not just from economic or military power, but also from the delivery of ‘international public goods’: initiatives and actions that bring obvious benefits to other nations. After the Second World War, the USA led the free world and gained legitimacy because it delivered international public goods. These included the Marshall Plan that helped rebuild Europe, a credible military protection umbrella and acting as the architect of institutions such as the IMF and the World Bank. What about Germany today? In the Trump era, some commentators ventured that ‘Merkel could oversee a truly consequential change in foreign affairs, a shift from Pax Americana to Pax Germania’, with Germany becoming the guardian of the ‘liberal world order’.24 They said a fourth mandate would see Merkel ‘preside over the creation of a newly powerful Germany’25 and become ‘leader of the free world’.26 Perhaps. What is more certain is that Merkel’s steadfast, reliable and polite style of leadership, her advocacy of international alliances and European unity (under German leadership of course) contrasted with that of a US leadership that seems erratic under Trump. Merkel has given the impression of injecting a dose of much needed stability into a world in turmoil. But what international public goods does Germany concretely deliver beyond what benefits itself? On the security front Germany, today a pacifist nation par excellence, has always been happy to allow France and the UK to lead. Moreover, a 2015 Pew Research Center poll showed that a 58% majority of Germans are unwilling to use force to defend a NATO ally under attack, the highest such proportion in Europe.27 NATO members are supposed to spend 2% of their GDP on defence (the target was agreed by NATO members in 2006). In reality, the USA covers about 70% of all NATO allies’ defence expenditure and only four other NATO members (Estonia, Greece, Poland and Britain) abide by the 2% target.28 France spends close to 2%, while some spend more, such as Greece which spends 2.5% (due to the threat it perceives from Turkey). Some spend less, such as Germany which spends only 1.2%.29 The better Germany has been doing, the less it seems to have been willing to spend on defence. In 1989, West Germany was spending 2.7% of GDP on defence, a figure which had dropped down to 1.4% by the year 2000, after reunification, where it remained until 2013, decreasing then to 1.2% by 2016.30 The USA pushing Germany and others to spend more on defence is nothing new and is not a ‘Trump thing’. Robert Gates, the Defence Secretary during Barack Obama’s presidency declared: ‘The blunt reality is that there will be dwindling appetite and patience in the US Congress, and in the American body politic writ large, to expend increasingly precious funds on behalf of nations that are apparently unwilling to devote the necessary resources.’31 The consequences of Germany’s cavalier attitude in respect of NATO’s military readiness are real, they are not American inventions: German forces used broomsticks instead of machine guns during a NATO exercise a few years ago because of a shortage of equipment; not a single German submarine was deployable in the autumn of 2017; German military pilots have been ‘using choppers owned by a private automobile club to practice because so many of their own helicopters are in need of repair.32 As reported by Reuters in 2016, Merkel herself recognized that ‘In the 21st century, we won’t be getting as much help as we got in the 20th. We need to greatly increase the Bundeswehr budget to get from 1.2 to 2%’ (a goal she set for 2024). Her Minister of Defence Ursula Von der Leyen admitted that other NATO members saw Germany was ‘doing so well economically’ and she recognized that ‘we must bear a larger, fairer, share of the burden for trans-Atlantic security’.33 In all fairness to Germany defence spending by Europeans in general has usually matched the overall perception of threat. It steadily declined after the end of the Cold War, but Europe sought to reverse the falling trend after Russia annexed Crimea in 2014.34

Is change in the air? Many in Europe would like to see Germany substantially expand its military forces and get more involved in European defence. But if there is change it is likely to be marginal as there is little appetite for it in Germany. German Foreign Minister Sigmar Gabriel made it clear that the 2% NATO target was neither ‘reachable nor desirable’ for Germany.35 In all fairness, one is entitled to question the validity and wisdom of this 2% ‘magic number’, which does not rest on anything solid and reduces the complex issue of defence to a quantitative parameter. In the case of Ukraine, for instance, Europe outspent the USA ten to one on its non-military responses to Russian actions in recent years—through foreign assistance, trade deals, sanctions, energy policy, and more—so in a sense Merkel can be excused for calling the 2% spending standard ‘narrow-minded’.36 But if so, then one can also question the 3% eurozone rule on deficits that Germany insists on every country respecting and which does not rest on any economic theory either. Another case of Berlin sticking by the rules when it suits its situation and ignoring them otherwise. As a result of lack of traction for serious defence spending, initiatives such as the Framework Nations Concept launched in 2013—a clever way for Germany to share resources with smaller European countries in exchange for the use of their troops so as to avoid real military expansion while showing more involvement—will have a marginal effect.37 Recent declarations by Berlin and Paris to the effect that they are working together toward a European security force, viewed by some as a reaction to Trump’s prodding (these initiatives actually go back a lot further),38 are also likely to have a marginal effect on overall European defence. Why has rich Germany been spending so little in recent times? First of all because after the fall of the Soviet Empire Germany does not perceive any direct existential threats to its security. Secondly because it can get away with it. Just as Germany was the first country to break the rules of the euro when it was in difficulty in 2003 and got away with it.

What about delivery of international public goods on the economic front? Here too Germany fails the test. Germany’s solidity underpins the euro but it has been unwilling to allow more symmetrical adjustments or measures such as Eurobonds or a softening of austerity measures to help stimulate weaker European economies. The same ‘selfishness’ applies to current-account surpluses. In February 2017, Germany reported the world’s largest current-account surplus: a monumental 270 billion euros. (compared with a 60 billion euro deficit for France).39 Chronic features of the German economy, these surpluses are testimony to its success. They are, however, controversial, because they create imbalances with Germany’s European partners as well as with the rest of the world. They represent distortions which have been criticized, among others, by the IMF, the US Treasury Department and the OECD. These surpluses are the result of several factors including wage growth restraint coupled with the fact that Germany invests little and saves more than it invests (excess savings end up as funds that Germany lends or invests abroad). If Germany was serious about lowering its surpluses (and stimulating weaker European economies) it would take measures to raise domestic wages faster, invest more at home and run deficits. But newfound German fiscal orthodoxy has it that deficits are anathema to the extent that a famous ‘debt brake law’ was enshrined in the constitution, capping structural borrowings at 0.35% of GDP (well below the 3% limit set by eurozone rules) from 2016 on, to prevent the temptation of using the Keynesian remedy of deficits. Germany is a nation of savers. Public opinion has latched on to the dogma of fiscal orthodoxy and German voters are loath to spend hard-earned cash on directly or indirectly helping other European countries. As a result, the wilful correction of structural current-account imbalances is just as unlikely to become reality as are any meaningful concessions aimed at making the eurozone more workable or helping weaker economies. French President Macron’s desire to reform the EU and the eurozone will probably flounder on the reality that nothing of substance will happen without Berlin’s approval; Berlin is unlikely to make concessions on anything substantial (even less so after the far-right AfD entry to the Bundestag in the fall of 2017) and Merkel’s weakened political position at home. Supremely confident and practical, Germany will first see to what it perceives as its own interests. The lack of international public goods emanating from Germany means the legitimacy of its de facto leadership only rests on the relative economic power it enjoys today compared to other European nations.

In all fairness one would be remiss not to consider the German point of view. Germany is not a nation of risk takers or big spenders. It is a nation of conservative and hard-working savers. Moreover it spent a lot on its reunification after the fall of the Berlin Wall. Unlike Southern Europeans Germans have had the merit of recognizing the need for painful structural reforms at home. They bit the bullet and undertook these reforms years ago. Reforms require sacrifices so Germans rightly ask: ‘Why, after all the sacrifices that got us where we are today, do we have to pay for others who refuse to undertake similar reforms? Moreover, we know that whenever we help them we take away the incentives for them to reform as we did?’ How do you think Germans would feel about helping a country, such as France, where people retire years earlier? Or one, such as Italy, where a woman has been known to get paid leave from her job because her dog was sick?40

The Joys of Becoming More ‘Normal’?

Angela Merkel’s popularity reached high levels as she ruled during a period in which everything seemed to blissfully go Germany’s way. The Kanzlerin projected an image of stability, sobriety and sound moral principles that endeared her to her constituency who fondly called her mutti. Yet history may remember her one day as the most divisive German Chancellor since the end of the Second World War. It is not just that, as Foreign Policy magazine put it, ‘After 11 years in power, Merkel’s CDU has run out of ideas’.41 Many feel that Berlin’s newfound unilateralism and assertiveness have severely damaged the European edifice. Under Merkel’s watch Germany’s handling of the eurozone crisis ended up firmly dividing Europe into creditors and debtors and contributed to economic collapse and massive unemployment in most of southern Europe. Her handling of the recent immigration crisis—unilaterally deciding to open the doors to a human tsunami and subsequently impose quotas—resulted in Brexit, the death of Schengen, an East–West cleavage and walls between countries, something Europe had not seen for a long time. Her decision to ignore the Dublin agreements in the case of Syrian migrants was taken without the consultation of her European partners. While it may have been partly motivated by commendable humanitarian concerns, it was doubtlessly also taken with the narrow interests of Germany’s demographic predicaments in mind. In Germany itself, her open-door immigration policies created profound divisions. They resulted in a palpable worsening of the country’s domestic security and stability and paved the way for the emergence of the far right. As a result, the AfD, founded only in 2014, accessed the Bundestag (parliament) in 2017: a first in postwar Germany. With its 13%, the far right is not about to assume power in a country where 80% of the people say they are centrist (compared to 51% in France).42 Germany is likely to continue being a ‘beacon of moderation and stability’, yet ‘one in eight voters supported a party that said Germans should be proud of the soldiers who fought in the Nazi army.’43 With the CDU/CSU (Christlich Demokratische Union Deutschlands/Christlich Soziale Union in Bayern) coalition of Christian democrats that traditionally governed German politics achieving its worse score in many years in 2017, the Kanzlerin faced the need to establish alliances comprising smaller, untested parties. The AfD intends to make itself heard loud and clear in the Bundestag and so a ‘noisy and fractious edge’ will be introduced ‘to a legislature previously marked by a relatively calm and collegiate tone’.44 According to World Politics Review columnist Frida Ghitis, ‘Merkel has vowed to regain the votes of those who backed the AfD. That will likely end plans for closer ties to the European Union, and it means German politics and policies will need to move to the right […] We can now say goodbye to sedate and predictable politics in Germany.’45

Autumn 2017 saw another important thing happen for the first time since the end of the Second World War. Following the failure of coalition-building negotiations in the aftermath of the September elections, Germany was, for the first time, without a government. On 20 November 2017 the world woke up to the reality that Germany—the exception, the epitome of stability—was starting to look a bit more like a ‘normal’ country by the day as the spectre of a new election loomed and the future of the Kanzlerin was in question. In an article ominously entitled ‘Germany Has Plunged Into Unprecedented Political Chaos’, Foreign Policy reported the words of University of Hannover sociologist Detlev Claussen: ‘It’s an ideal situation for the AfD, which will paint the mainstream parties as bumbling elites ready to compromise everything and waste taxpayers’ money […] The AfD will look all the more respectable now. It’s very likely that come fresh elections we’ll see a further shift to the right. This would be extremely bad for Germany—and for Europe, too. Now there’ll be in less room for negotiating EU reforms, and Germany-first sentiment will be all the louder.’46 Having a few months earlier praised the virtues of Germany observers and the media now concurred that Europe ran the risk of losing this pillar of stability, especially in a post-Merkel era. Having praised Merkel as the new ‘leader of the free world’ in a February 2015 article by journalist Jochen Bittner, The New York Times warned of ‘serious uncertainty for all Europe and the West’ in November 2017. The first casualty would be French President Macron’s grand plans for further integration and reform of the EU and the eurozone, for which he needed Berlin’s full attention and cooperation. Germany would, instead, probably be thinking ‘Germany first’ even more and would be busy licking its wounds. Brexit talks would be further complicated by a weakened Berlin. ‘The European Union, mired in the severest crisis since its founding, was counting on Merkel and a new German government to deliver, in tandem with France’s President Emmanuel Macron, the energy and vision for far-reaching reforms to deepen European integration’ wrote Foreign Policy ‘But now everything, including the EU’s prospects, is up in the air’. On the other hand, Macron would probably see a weakening of Germany as an opportunity to reassert more leadership from France on the continent and a rebalancing of the Paris-Berlin partnership was not all that bad for Europe. According to former Italian Premier Enrico Letta, the few months following the German election amounted to the last chance for France and Germany to join hands in order to undertake much needed European reforms.47 Scenarios of political instability in Germany are, however, easy to over-dramatize. Extreme scenarios—such as the far right coming to power, or a succession of Italian-style short-lived, unstable governments—are entirely out of the question. In all likelihood, the prudent Germans will work something out that will take the country not too far from its current trajectory. Nevertheless, a slightly more divided and less stable Germany, where the AfD could gain slightly more power, would mean an even more self-centred Germany. The paradox, from a EU perspective, is that the only thing worse than a strong Germany is a weak Germany. CNN warned that ‘The EU is mired in its gravest crisis since its founding, shaken by Brexit, the stubborn eurozone crisis, lack of unity, and the rise of a far right in its midst. Donald Trump’s erratic international policies have dramatically underscored the need for the Europeans to get their act together on security and foreign affairs […] This is why the EU needs and expects a strong Germany—now more than ever […] The EU is stuck in a holding pattern as long as the German crisis persists.’48

The point of this section is not that Germany is ‘bad’. Far from it. One can only admire this country’s undeniable successes across in many fields. It has been a pillar of European construction, stability and order. It is arguably the most successful post-modern power at the dawn of the twenty-first century. Yet, in order to better understand the world around us, a little debunking about German myths is in order. The point is that for all its prowess Germany is not infallible. It can make mistakes: small as well as big. Despite being Europeanist, Germany roots for Germany—and will continue, mostly unopposed, doing what it perceives as being in its self-interest—and why should it be any different? Whether it wanted it or not, Germany has found itself firmly Uber Alles, in the position of de facto leader of Europe, unchecked, and in control of the European agenda. All the more since the rest of Europe has been unable to get its act together. Yet, Germany’s reluctance to see beyond its narrow self-interest, its self-righteousness, its fixation on economic orthodoxy and its tendency to exercise its hegemonic position with scant regard for its European partners, mean Germany is unfit to lead Europe.

Footnotes

  1. 1.

    Rainer Buergin. ‘Germany’s Success Could Wreck Martin Schulz’s Bid for Power’. Bloomberg.com  – Bloomberg. 16 August 2017.

  2. 2.

    ‘USA/dieselgate: peine de prison pour un ex-ingénieur de Volkswagen’. Lefigaro.fr – Le Figaro. 25 August 2017.

  3. 3.

    ‘USA: Volkswagen rappelle 281.000 voitures’. Lefigaro.fr – Le Figaro. 29 August 2017.

  4. 4.

    Oliver Sachgau. ‘Merkel Cites ‘Trust’ Problem With German Carmakers’. Bloomberg.com . 9 September 2017.

  5. 5.

    Michelle Fitzpatrick. ‘Les mensonges de l’automobile au coeur de la campagne électorale allemande’. France24.com . 15 August 2017.

  6. 6.

    Oliver Sachgau. ‘Merkel Cites ‘Trust’ Problem With German Carmakers’’. Bloomberg.com . 9 September 2017.

  7. 7.

    Ben Protess, Jack Ewing. ‘Deutsche Bank to Pay $2.5 Billion Fine to Settle Rate-Rigging Case’. Nytimes.com – The New York Times. 23 April 2015.

  8. 8.

    Arno Schuetze. ‘Deutsche Bank to fight $14 billion demand from US authorities’. Reuters.com – Reuters. 16 September 2016.

  9. 9.

    Jack Ewing. ‘Deutsche Bank Announces $7 Billion Yearly Loss as Legal Issues Weigh on Results’. Nytimes.com – The New York Times. 20 January 2016.

  10. 10.

    ‘Deutsche Bank prepares 8 billion-euro capital increase’. Reuters.com – Reuters. 3 March 2017.

  11. 11.

    L. Shapiro, Lili Bayer. ‘Signs of Trouble for Deutsche Bank’. Geopoliticalfutures.com . 1 July 2016.

  12. 12.

    Mark Thompson, Paul R. La Monica. ‘Deutsche Bank: Does it need a bailout?’. Money.cnn.com . 30 September 2016.

  13. 13.

    J.C. ‘Explaining the Munich miracle. On almost every indicator, Germany’s south is doing better than its north’. The Economist. 20 August 2017.

  14. 14.

    ‘The beautiful south. Germany’s new divide’. The Economist. 19 August 2017.

  15. 15.

    Rida Husna. ‘Germany GDP growth rate’. Tradingeconomics.com . 15 August 2017.

  16. 16.

    Mathilde Golla, Clémentine Maligorne. ‘Sous Merkel, l’économie allemande s’est imposée comme moteur de l’Europe’. Lefigaro.fr – Le Figaro. 24 September 2017.

  17. 17.

    Dr. Philip Ehmer. ‘Labour productivity of large euro area countries drifts apart – Italy falling behind’. Kfw.de . 26 July 2016.

  18. 18.

    ‘Why Angela Merkel deserves to win Germany’s election’. Economist.com – The Economist. 9 September 2017.

  19. 19.

    ‘The Germany that doesn’t work’. The Economist. Page 25. 17 June 2017.

  20. 20.

    J.C. ‘German politics is about to tip rightwards’. Economist.com – The Economist. 17 September 2017.

  21. 21.

    Estelle Peard. ‘Dans la Ruhr, la désespérance des travailleurs allemands pauvres’. AFP. 11 May 2017.

  22. 22.

    Mathilde Golla, Clémentine Maligorne. ‘Sous Merkel, l’économie allemande s’est imposée comme moteur de l’Europe’. Lefigaro.fr – Le Figaro. 24 September 2017.

  23. 23.

    ‘How Angela Merkel is changing, and not changing, Germany’. Economist.com – The Economist. 9 September 2017.

  24. 24.

    Johanna Scbuster-Craig. ‘Angela Merkel, Donald Trump and the free world: is the stage set for a strong German leader to eclipse America?’. Newsweek.com – Newsweek. 11 July 2017.

  25. 25.

    Jacob Heilbrunn. ‘Will Pax Germania replace Pax Americana?’. Latimes.com – Los Angeles Times. 9 February 2017.

  26. 26.

    Johanna Scbuster-Craig. ‘Angela Merkel, Donald Trump and the free world: is the stage set for a strong German leader to eclipse America?’. Newsweek.com – Newsweek. 11 July 2017.

  27. 27.

    ‘Many NATO Countries Reluctant to Use Force to Defend Allies.’ Pewglobal.org . 8 June 2015.

  28. 28.

    ‘Germany rebukes Tillerson over call for Nato allies to boost defense spending’. Theguardian.com – The Guardian. 31 March 2017.

  29. 29.

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Copyright information

© The Author(s) 2018

Authors and Affiliations

  • Francesco M. Bongiovanni
    • 1
  1. 1.

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