German economy forecast to lag eurozone growth until 2026
The German economy is expected to significantly underperform the eurozone average until at least 2026, according to the European Commission's Autumn Forecast released on Friday.
Merkel, who grew up in East Germany, where Putin was a KGB operative, refused to be intimidated by the orchestrated machismo
Back in 2007, aware of her fear of dogs, Vladimir Putin invited his Labrador into a photo call during his second encounter with the then relatively new German chancellor. Angela Merkel was clearly uncomfortable as the beast sniffed her out. The Russian president smirked. “I understand why he has to do this,” she later said. “To prove he’s a man. He’s afraid of his own weakness. Russia has nothing, no successful politics or economy. All they have is this.”
Merkel, who grew up in East Germany, where Putin was a KGB operative, refused to be intimidated by the orchestrated machismo. Almost 15 years later, Putin is the only European leader who was already in situ when Merkel ascended to the chancellery in Berlin in 2005.
Since then, she has dealt with four French presidents, five British prime ministers, eight Italian premiers and four US presidents. But that sort of longevity is not uncommon in German politics — Helmut Kohl enjoyed an even longer tenure in the twilight years of the 20th century.
What’s uncommon, though, is that Merkel’s exit is voluntary. Had she decided to remain at the helm of the Christian Democrats (CDU), it’s possible that the outcome of last Sunday’s German election would have been different.
Towards the end of this year’s election campaign, Merkel felt obliged to go out on the stump and solicit votes for her preferred successor, Armin Laschet. The effort appears not to have paid off, given the CDU has scored its worst result since its postwar birth, conceding the first spot in the race to the Social Democratic Party (SPD).
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Laschet wasn’t the only continuity candidate, though. SPD leader Olaf Scholz, vice chancellor under Merkel in the most recent coalition, has also sought to portray himself as a worthy successor. One of them is more or less guaranteed to be the next chancellor, and the probably protracted negotiations ahead could leave Merkel at the helm of a caretaker administration for weeks or even months to come.
Given that the SPD and CDU are unlikely to opt for yet another coalition with each other, chances are that the next government will consist of three parties, with either of the big two teaming up with the Free Democrats and the Greens. The SPD and the Greens have both increased their vote substantially since the 2017 election, but the German Greens are hardly radical by any stretch of the imagination, and the SPD’s progressive tendencies are a thing of the past.
Either, or both, could prove perfectly adept at the task of uninspiring continuity. Merkel thrived as an able manager of the status quo, both within Germany and in the wider EU. She successfully strove to preserve the eurozone when it no longer seemed sustainable — and thereby maintained the inequities that define Germany (where the richest 1 per cent possess almost a quarter of all wealth) and Europe more generally.
A personally austere lifestyle translated into measures that enforced austerity in Germany and the wider EU, most notoriously in Greece. The Greek bailout essentially involved persuading European taxpayers to come to the aid of an ailing member of the fraternity, but the resultant funds merely passed through Athens and resulted mainly in replenishing the coffers of far richer nations’ (especially Germany’s) banks.
Southern European austerity was of a different order in comparison with the German variety, and made it that much harder for nations like Greece and Spain to cope with the mid-decade flood of refugees. It must be acknowledged, though, that in many ways the refugee crisis of 2015-16 was Merkel’s finest hour.
Another politician might have baulked at the idea of playing host to so many Syrians, Iraqis and Afghans (among others), but Merk—el declared “we can manage this” and threw open Germ — an borders for a while. It was an un — expectedly hu—ma—ne response to what was already a European crisis, and Germany has accommodated 1.7 million asylum seekers between 2015 and 2019.
That has proved to be a remarkably successful experiment, with high levels of integration and employment. But, of course, there has also been a backlash. Alternative for Germany (AfD) emerged as a fringe force in response to the Greek bailout, but its racist and neofascist ideology struck a wider chord in the wake of the refugee influx. It has lost some ground since then, but has retained a substantial foothold in the Bundestag.
Furthermore, Merkel was subsequently ins — trumental in reinforcing the Fortress Europe paradigm, including deals with Turkish and Libyan forces to retain further refugees.
Merkel’s confidence and relative competence have tended to obscure her broader lack of vision. Even so, one of her fiercest critics, former Greek finance minister Yanis Varoufakis, concedes that, notwithstanding her grievous shortcomings, “watching the pack of faceless banal politicians jostling to replace her, I very much fear that I shall miss Angela Merkel”. It’s hard to disagree.
Dawn/ANN.
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