Features

Angela Merkel is on her way out – and so is her vision for the EU

3 November 2018

9:00 AM

3 November 2018

9:00 AM

Whatever anyone’s views on the enterprise, there was one question always begging to be asked of the European Union: ‘What do you want to be when you grow up?’ At an early stage it wasn’t clear to everyone. Then the purpose and direction of travel seemed agreed — under the stewardship of Angela Merkel. She was there to settle disputes, authorise bailouts, offer German help to struggling nations and protect the project as it led to ever-closer union. Whatever else can be said of it, with Merkel at the helm at least the EU appeared to have direction. Not anymore.

This week — after another political drubbing for the CDU in Hesse — the German Chancellor announced that she would not seek re-election as head of the party she has led for 18 years. She also announced she would be stepping down as Chancellor at the next election, in 2021, a position she has held since 2005. During that time in office she has worked with four French presidents, four British prime ministers, and seven people who tried to run Italy. Her demise is proving a drawn-out affair — but we can see, in parallel, the demise of her vision of Europe. A clear, federalist vision which once seemed inevitable and now sorely lacks a leader.

Today there is simply no one on the scene capable of acting as the queen or emperor of that project, as Merkel has done for the past decade. That is due, in no small part, to the decisions she took and the hardness and hubris with which she acted when she held the most powerful position in Europe. The Merkel project had created a EU that had unachievable ambitions, seeking to govern countries with long histories of independence, and was fundamentally un-European in that it sought to impose uniformity upon the most gloriously diverse set of countries on earth.

It’s odd to think how recently it was that Merkel and her vision of Europe seemed unassailable. The first scent trails of her political mortality came in 2016, when in regional elections in Pomerania the three-year-old Alternative für Deutschland (AfD) beat her own party into a humiliating third place. Then came last year’s German elections, in which the CDU suffered its worst results since 1949. Merkel spent six humiliating months trying to persuade other parties to go back into coalition with her — fighting off repeated challenges from critics among her own colleagues, most prominently the interior minister Horst Seehofer.

It is easy to see why they have tried to move against her. Merkel’s great selling point — her rock-like immovability — had become an obstacle, being seen as intransigence in a Europe that badly needed to change. Indeed, that immovability turned out to be disastrous before both challenges that Europe had to respond to during Merkel’s reign: the financial crisis, and the wave of demographic change.

The Europe that Merkel led pushed the creation of a currency before it had created a country. When the global financial crisis hit the unsound structure that was the euro, Merkel had two options. She might have explained to her electorate that Germany had benefited from the euro. That its exports had soared because of it (with a currency which the IMF reckoned to be artificially devalued by around 30 per cent). She might have explained that now was the time for the eurozone to turn into a full transfer union, moving money from the richer unions to the poorer ones.

Or she might have accepted that the eurozone covered economies that were simply too different — that German and Greek accounting practices would, to put it politely, never fully meld — and that an orderly separation of the union might be in order.


The immovable ‘Mutti’ (as the Germans used to fondly call her) took neither course. Instead she oversaw a system that imposed sado-austerity on southern Europe, left the eurozone ill-prepared for the next crisis, and set the stage for events that would lead to her own downfall.

German unemployment now stands at a historic low of under 5 per cent. In Italy, by contrast, it’s 10 per cent, a decade after the slump — and an appalling 31 per cent among the youth, far higher than the 19 per cent at which it stood before the crash. The fiscal straitjacket that Merkel forced upon the Italians (imposed by bureaucrats whom she and Brussels had in turn imposed on the Italian public) helped create an entire generation of Italians who started their lives with no chance of work. And who were receptive to new political parties who would point to a whole new way of doing things.

Had Italy been able to respond to the crash in its own way, things might have been very different. As Joseph Stiglitz has observed, the project of which Merkel was the champion tied together countries with ‘vastly different economic and social backgrounds, denying them the vital ability to manipulate their exchange and interest rates’. What may have felt like burden-sharing in Berlin felt very different in Athens and Rome. And now the political consequences of this have finally led back towards their instigator.

But the mistake which was to prove the turning point for her chancellorship, and the European project, was the migration crisis. At its peak, in 2015, Merkel showed not only her immovability, but a unilateralism which was staggering. Throughout that period, Merkel seemed to think that she had the right to continue making decisions on behalf of an entire continent. When she unilaterally announced the suspension of normal border and asylum procedures in August that year, inviting refugees to Germany and declaring ‘We can do this’, she consulted few of her counterparts and listened to the warnings of none.

Only as Germany became overwhelmed did the Chancellor’s presumption become clear — as did the consequences. Just as Europe had in her view shared the burden during the financial crisis, so should fellow member states split the bill that Merkel had run up alone in Berlin, in her one heady moment of moral intoxication. But the rest of Europe turned away. From Westminster to Warsaw, nobody wanted to share the burden for decisions that they knew their own electorates would not forgive.

Overnight, Merkel turned from a force of stability into a wild gambler with her country’s future. And in election after election, the rest of Europe began to pull away from her. The Hungarians were at first the most vocal. But Berlin, like Brussels, could cope with the souring of relations with the Visegrad countries, condescending to them as trainee Europeans who had not quite grasped how things are done. This narrative was harder to sustain once Britain voted to leave the EU. It became impossible once Italy, a founding member state, started heading in another direction. Five Star had been boosted by the decade of outside-imposed austerity, while the Lega was catapulted by Italy’s first-hand experience of Merkel’s invitation to the world to come to Europe.

We see this crisis playing out still, with the EU recently rejecting Italy’s proposed budget and sending the Italians back to do their maths again — with threats of billions of euros in fines if they don’t cooperate. But the Italian government is not simply going back to study and come back with the right answer. And opposition to Merkel-ism pays well at the Italian polls. Opinion surveys show the Lega have almost doubled their share of the vote since March. At some point soon, they could head back to the polls and come back with a result which will cause an even greater nightmare for the north. The Italians have had enough.

The same is true in Greece and Poland, where things are turning ugly. Politicians there are once again trying one of their favourite extortion tricks — the Polish President and MPs from Syriza in Greece once again taking up the subject of second world war reparations. Both are arguing that Germany did not sufficiently compensate their countries for the crimes of the Nazi era. According to President Andrzej Duda, a group of Polish experts is looking into the issue, and has already concluded that ‘-Warsaw was levelled to the ground’, which ‘we were never compensated for’. A cross-party report from Greece, meanwhile, says that Germany owes Greece €299 billion for the occupation. One has to admire the uncommon restraint the Greeks have shown in not rounding up that bill.

Wherever you look — and whatever one feels — the conclusion is the same: this is not a Europe of ever-closer union. Instead, the EU has become a source of instability in the continent by its Merkel-like refusal, or inability, to reform. As she begins to exit, she leaves a country where the AfD is the main party of opposition, where protests in Chemnitz and elsewhere have seen outbreaks of Nazi saluting, and where everybody seems to be talking about the war.

Her throne will likely sit empty, because there is only one politician in Europe who seems to have any desire whatsoever to take it. Emmanuel Macron is facing the usual problem in France of a public that perennially votes for revolution and then resists all change. But the French President has been preparing for this moment of continental leadership for years — composing whole treatises on EU reform. His idea is to further centralise the eurozone, with an EU finance minister and a joint eurozone budget. For this, he needed German buy-in: as he warned Germany earlier this year, ‘our ambitions cannot be realised alone’.

Merkel was all set to back his eurozone plan in return for his supporting an EU-wide plan to manage migration. Which might all have been fine. But now that Merkel has announced her own exit, Macron has lost the only real ally he had. Salvini will certainly not be helping him. And none of the other countries, even if they wanted to, are in a position to bring along their increasingly reluctant fellow members.

Apart from Macron and the Commission, no one in Europe has taken the lesson from the Merkel era that ‘more’ EU and fewer nation states are the way to go. Rather, the pendulum has swung the other way. And unless the Commission develops a sci-fi-like ability to become self-aware and take over the world, it looks like the role of leader of Europe will remain vacant.

There will be a future for the EU — just not the one that seemed inevitable at the height of Merkel’s power. For whatever the view from Brussels and Berlin, during the Merkel years, the rest of the continent suffered the growing pains and decided one country at a time that this wasn’t what they wanted to be. The end of an era, certainly. But not the end of the world.

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