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Here come the liberals

For decades American conservatism defined global politics. Now we are about to witness a seismic cha

British politicians, commentators and the public like to believe in their sturdy autonomy. We have arrived at our decisions as freeborn men and women. We debate our ideas furiously in pubs, on radio phone-ins or via letters to the editor. We read the opinion pages. We elect a sovereign parliament that passes the laws and regulations that we mandate.

The truth is more subtle. We dance to another country's tune. It is the United States that makes the political, cultural and intellectual weather. It is the rich American institutes that develop the ideas for XYZ plan or ABC radical reform. Our academics, especially in the social sciences, want to get published in the American journals and ensure they please the editor in question. Our politicians watch closely to see what works in the US. We enjoy their movies and use their technology. The West Wing and Mad Men are part of our culture, as are Sex and the City and Friends. We think we are free; we are painfully and excessively influenced by the US.

Which is why the election of Barack Obama matters so much. In the tidal wave of tears of joy, analysis of county by county results, the "were you awake to hear the speech" conversations, naming the puppy and the critiques of Michelle's wardrobe - and yet another article on the big things in his in-tray - one thing has been underplayed. Obama's success will transform British politics. The centre ground will move significantly to the left.

No account of the rise of Thatcherism or the character of new Labour is possible without acknowledging the force and impact of the 30-year ascendancy of American neoconservatism. They won control of Washington in the late 1970s, creating the Washington consensus. No country - from communist China to the Nordic social democracies - held out. Everybody, to a degree, bought into the market fundamentalist consensus. Tony Blair could have held out more than he did - but the room for manoeuvre was tiny.

It went very deep. Editors of the top US social science journals published articles in this idiom because they had secured their jobs by conforming to it; ambitious British academics soon learned what was accepted and what was not. Young British investment bankers training in New York learned about the value of securitisation. Treasury officials on secondment to Washington bought into the consensus that privatisation and deregulation were the only ways forward. From social policy (remember zero tolerance and broken windows) to " light touch" financial regulation, and from a belief in labour market flexibility to distrust of public service broadcasting, the cultural and intellectual backdrop was conservative.

Obama's election ends that. American conservatism is now in profound disarray. It is not just that Republicanism has been forced back to the south and the mountain states: the intellectual paradigm that it championed led to nowhere but a credit crunch, a bloated and overpaid financial elite and the onset of a deep recession. No accident that Obama's lead jumped in the wake of the Lehman Brothers' bankruptcy and the part nationalisation of the banking system. Conservatism was on the ropes. A change had to come. Yes it did.

Here is a checklist of areas where the discourse is going to move left - intelligently and moderately because that is part of the Obama DNA. Firstly, trade unionism. Barack Obama shares the view of liberal Democrats that the best way to roll back the stagnating real incomes of the squeezed middle of the United States is to strengthen the bargaining power of organised labour. An empowered upper working class across all ethnic groups is the backbone of both the Democrat party and the economy.

This president is the most pro-union since Roosevelt. He wants to help unions organise and get recognition through a simple membership card check system, which workers can use freely and anonymously to signal their readiness to join - fiercely opposed by American business. This June, Obama even wrote to Tesco boss, Sir Terry Leahy, urging him to work with unions in the US (as he already does in the UK). The anti-unionism that led US officials to veto OECD reports that questioned labour market flexibility will be over. Now the US will encourage the OECD to publish evidence.

The BBC and Channel 4 should also be relieved at the victory. Obama is a strong supporter of public service broadcasting and caps on media ownership; he wants to see every American television and radio network commit to neutrality. In the US, one of the live issues is whether the Fairness Doctrine, requiring equal time between different points of view on broadcast media, should be reinstated - it was abolished by Ronald Reagan.

The subsequent avalanche of right-wing shock-jocks, the dumbing down of the American media and the partisanship of Fox News are even more an issue for the left in the US than the power of the right-wing print media is in Britain. For Democrats in the House, and Obama's chief of staff Rahm Emanuel, reinstating the Fairness Doctrine is of iconic importance. Obama may stop short of imposing a legal obligation on broadcasters - but he will go a long way towards it.

So it goes, too, with tax. This is the president who will redistribute income from the top 5 per cent earners above $200,000 to the other 95 per cent. There may not be much cash involved, but as Professor Avner Offer says in The Challenge of Affluence,, the point about higher tax rates is not so much the cash they raise but the signal they send about the dominant values of society. Obama has clear views on that. As he has on tax havens.

His reforms of Wall Street will be far-reaching; he will constrain bank bonuses, introduce tough new regulations and, as Roosevelt did, set up a wave of new banking institutions. He is already committed to a National Infrastructure Bank. When this is set up, financing roads, railways, bridges and dams across the US, the argument that Britain should have one too will become irresistible. Obama will try to deliver universal health provision. He will try to extend college access. He will want to build affordable homes. He will try radically to lower the US's carbon footprint, lower petrol consumption and improve energy efficiency. He will aim to reindustrialise the US.

As for foreign policy, he will be more multilateralist and there will be no Iraqs on his watch. But he is closer to Tony Blair and David Miliband (I think, rightly) as a liberal internationalist than many on the British left might like. Enlightenment values, democracy and human rights are worth asserting as universal rather than western principles. And, at the limit, worth fighting for. Trade is a big question mark. His party remains very protectionist.

For all that, the message is unmistakeable. Barack Obama will change the trajectory of the US.

I have found it odd to have been pro-BBC, pro-multilateralist Europe, pro-moderate trade unions, a City of London sceptic, pro-public service, pro-fairness and pro-redistribution for more years than I can remember. Now the leader of the world's hegemonic power, in control of its political, intellectual and cultural levers, is making this cluster of views the mainstream. The Labour Party and the wider liberal left are being given permission to be moderately and intelligently social democratic again. It may be a hackneyed phrase - but this really is a seminal moment.

Will Hutton is executive vice-chair of The Work Foundation

Obama's inner circle

Rahm Emanuel: chief of staff An Illinois congressman and the fourth-highest-ranking House Democrat. A centrist renowned for his aggressive manner, he is a former ballet dancer and was a volunteer mechanic in Israel's army during the first Gulf War in 1991. After working for the Clinton White House, he made $18m in two years at an investment bank. He is feared for his tactical prowess on Capitol Hill by Republicans and by Democrats who are not on his list of favourites.

Robert Gibbs: press secretary Gibbs has been with Obama since his 2004 Senate campaign, an affable Southerner with a temper. He was despatched on the trail in 2007 after concerns that Obama's message wasn't getting across; no adviser has spent more time at Obama's side. He made waves in a recent on-camera confrontation with Fox News's arch-conservative commentator Sean Hannity. Obama calls him "the guy I want in the foxhole with me during incoming fire".

Robert Gates The secretary of state for defence may hold on to his position in the short term to provide continuity in Iraq and Afghanistan. He has worked as a CIA chief and president of Texas A&M. He shares Obama's vision for emphasising "smart power" over raw military force, and keeping him on could lend a bipartisan aura.

Lawrence Summers Tipped for the position of treasury secretary, a post he held under Clinton, Summers is also a former World Bank chief economist and Harvard president. Intellectually, he is hugely respected, but his occasional tactlessness - notably his comments about women's aptitude for science - has earned him detractors.

Tom Daschle Tipped for a cabinet-level post, possibly secretary of state or health policy tsar, Daschle led the Senate for a decade before being voted out in 2004. His early support for Obama lent the candidate credibility, and his legislative know-how will be of use in driving the agenda.

David Axelrod A likely senior White House adviser, Obama's chief campaign strategist began his career as a reporter for the Chicago Tribune. He will be keeping his eye on Obama's 2012 re-election prospects, though probably with less of a hand in policy than Karl Rove had.

Valerie Jarrett A contender for a cabinet post, Jarrett is more likely to become a White House adviser. Co-chair of Obama's transition team, she is a businesswoman and a close friend of Barack and Michelle Obama.

This article first appeared in the 17 November 2008 issue of the New Statesman, Obamania

Photo: STEFAN BONESS/PANOS
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What Britain needs to understand about the profound and ancient divisions in Germany

As Angela Merkel campaigns for re-election, the balance of power in Europe is changing.

On 24 September, Angela Merkel will be re-elected chancellor of Germany and that, we might think, will be that. With Merkel and France’s Emmanuel Macron in control of the European project, populism will surely be vanquished and the old Franco-German core of the EU restored. Yet things are changing, and if western Europe wants Germany to keep singing “Ode to Joy” as enthusiastically as “Deutschlandlied”, it will have some work to do. Our Brexit negotiators need to see how important this is to Macron, to other European leaders and, above all, to thinking Germans.

For we may all soon miss the old, self-effacing Germany. Despite having such economic power, it always seemed to have no greater wish than to exist as part of a larger whole. Konrad Adenauer, its first postwar chancellor and founding father, made Westbindung (“binding to the West”) the heart of West German politics. Adenauer came from the deeply Catholic Rhineland, “amid the vineyards” as he put it, “where Germany’s windows are open to the West”. His instinctive cultural sympathy was with France, but he knew that West Germany’s existence depended on keeping America in Europe. France he courted out of profound conviction, the US out of clear-eyed necessity, and he was worried that after him this twin course might be abandoned. His demands for reassurance during his final year in office led to John F Kennedy’s “Ich bin ein Berliner” speech of 1963. Every West German knew about that, and about the Berlin Airlift: these became locations of national memory from which West Germany triangulated its sense of self.

There were some Germans for whom this was too much. Anti-Americanism was ingrained among West Germany’s hard left, the early Green Party and the tiny hard right. But even Germans who were suspicious of America had no fear of tying themselves closer to Europe. On the contrary, that was exactly what they wanted. The standard explanation of this is guilt. West Germans, in this argument, felt so remorseful about the horrors of the Second World War that they wanted to make amends. This idea fitted with others’ belief that Germany did indeed have much to feel guilty about.

A nuanced version of this held that the western Germans thought they had somehow “got away with it”, compared with their brethren in the east, who had felt the weight of Soviet vengeance: rape, pillage, occupation. Accordingly, Germany’s willingness to subsume itself so thoroughly, even as it footed the bills for the European Economic Community and later the European Union, was accepted with little gratitude, almost as an ongoing war debt repayment.

This guilt thesis is based on a misunderstanding of German history, especially of the experience of western Germans. The most graphic illustration of this comes from Adenauer. In 1955, he privately informed the British that while he was obliged to act in public as though he wished for reunification, he intended to devote his remaining years to blocking it. In 1961, he secretly proposed to the Americans that they offer the Russians a swap: they and he should, he said, give up West Berlin in return for Thuringia (the region containing Leipzig and Weimar). He wanted, in effect, to make the River Elbe the eastern border of Germany.

Why did Adenauer dislike the eastern Germans, think Berlin was expendable and consider the River Elbe to be the natural frontier? Simple: he knew that the Elbe was Germany’s Mason-Dixon line. Beyond it lay the flat, grim Prussian heartlands, which until 1945 stretched into present-day Russia. This vast region was known to Germans as “Ostelbien” – East Elbia. Adenauer viewed the “unification” of Germany in 1871 as East Elbia’s annexation of the west. That’s why in 1919, as mayor of Cologne, and again in 1923, he tried to get Britain and France to back a breakaway western German state. Having failed, he is said to have muttered, “Here we go, Asia again,” and closed the blinds every time his train crossed east over the Elbe.

Prussia was a different country. The victorious Allies agreed. On 25 February 1947, they declared: “The Prussian state, which from early days has been a bearer of militarism and reaction in Germany… together with its central government and all its agencies are abolished.” The name Prussia was eradicated. The Prussian hegemony of 1871-1945, an anomaly in the two millennia of German history, was over.

If we understand this, we understand what West Germany really was and why it acted as it did; why the “reunification” of 1990 – or, at least, the way it was handled – was such a mistake; why we may all have to stop taking Germany quite so much for granted now that East Elbia is back; and why our Brexit negotiators are on a hiding to nothing if they believe that the Germans have no more urgent business to consider than their car exports to us. Far more important to liberal Germans is keeping safe the western soul of Germany.

***

West Germany was anything but an artificial construct. It was the historical Germany, being almost geographically identical to what was, for almost 1,200 years, the only Germany. Julius Caesar named the land, together with its people, in 58 BC; 49 years later, Drusus, the greatest commander of the infant Roman empire, is said to have been supernaturally advised that after defeating every tribe he met in Germania, he should halt at the River Elbe. By 100 AD, Roman rule was shown by a fortified border, the Limes Germanicus. You can still walk large stretches of it; it encompasses most of the richest land in modern Germany and all of the great cities except Hamburg, Berlin and the 19th-century industrial monocultures of the Ruhr. Even these last were born as trading posts or forward bases within what archaeologists call the “market region” of Germania – the lands beyond the limes where commerce with the Roman empire defined the whole culture. Southern and western Germany’s cultural roots are almost as Roman as France’s.

But what about 9 AD and the destruction of three Roman legions by the German tribes under Arminius? There is a popular myth that this kept all Germany free and different. We owe this idea to Martin Luther and his supporters: Luther claimed from 1520 onwards to be a German, anti-Roman hero and identified himself with the newly rediscovered tale of Arminius. More decisively, the events of 9 AD were an obsession of later Prussian historians, who had an interest in claiming that the real Germany was one that was pure and un-Romanised. Yet the reverse is true. Under the Romans, then the Merovingians, then the Franks, the Rhine/Danube super-region of Germany remained politically and culturally a part of western Europe. After Charlemagne, a Rhineland German, “restored the Roman empire” (as his seals put it) in 800 AD, western Germany was the very centre of things. It was never a nation state, but always the key part of a greater whole, the Holy Roman empire.

Along the Elbe, things were different. Charlemagne extracted tribute from the pagan Slavs across the river, and his successors tried to build on this, but the German conquest and settlement of East Elbia only really began with the Wendish Crusade of 1147, the northern arm of the Second Crusade. Three centuries later, the entire region was still hotly disputed by Balts and Slavs, with German supremacy threatened by major defeats at Tannenberg (1410) and in the Hussite Wars (1419-34).

Long-contested frontier lands breed a special kind of society. The German incomers cowed the natives, such as the pagan Pruscie from whom they ultimately borrowed their name, through brute force. Where they couldn’t, they had to make armed deals with local elites. In this new sort-of-Germany, the Junkers, an aggressive landowning caste, lorded it over the Slavs and Balts – as well as poorer Germans, who knew that the locals would cut their throats if the Junker castles fell, so were loyal and subservient to their masters. East Prussia remained like this within living memory.

In 1525, Prussia named itself and declared itself the first Protestant state. From then on, it had absolute rulers, the Hohenzollern dynasty, backed by a quiescent Lutheran state church. The Junkers swore loyalty in return for exclusive access to all officer-level jobs in the army and the administration. By the mid-18th century, Voltaire quipped that while other states had armies, the Prussian army had a state. The overriding strategic concern of Prussia was always with the east. In his 1758-59 campaigns, Frederick the Great was shocked to find the Russians extremely hard to beat. He bequeathed to his successors a policy of keeping the tsars onside. Partitioning Poland between them was the sticking plaster that masked this Russian-Prussian rivalry, right until 1941.

This thoroughly east-facing power was, by the normal standards of European statehood – history, social structures, religion, geography – a different country from the Rhineland, Swabia or Bavaria. It defeated them all in 1866, laying the ground for the “unification” of 1871. The Prussian empire (for that is what it was) could now enlist the wealth, industry and manpower of Germany in pursuit of its ancient goal: hegemony over north-eastern Europe. By 1887, the future imperial chancellor Bernhard von Bülow was already musing on how to destroy Russia “for a generation”, cleanse Prussia of its Poles, set up a puppet Ukrainian state and take the Prussian armies to the banks of the Volga. This is the bloody Prussian – not German – thread that leads directly to the Nazi onslaught of 1941. In 1945, that centuries-long struggle was settled, in almost inconceivable violence. Half of East Elbia was ruthlessly stripped of Germans and handed over to Poles or Russians; the rump became the German Democratic Republic (GDR), a mere satrap of the Red Army.

So while it is easy and comfortable to say that the otherness of eastern Germany today is the result of that 40-year Soviet occupation, history says otherwise. East Elbia has always been different. Take the voting patterns: from 1871 to 1933, East Elbia outside Berlin (always a left-liberal political island) was the main electoral reservoir for the authoritarian right. The Prussian Conservative Party under the empire, the Deutschnationale Volkspartei until 1928 and the Nazis from 1930 depended on rural and small-town East Elbian voters. It was they who (just) swung things in 1933, by going 50-60 per cent for the “Hitler coalition”. Had all Germany voted like the Rhineland or Bavaria, Hitler and his Junker allies would have got nowhere close to a majority. Small wonder that Adenauer didn’t want East Elbia back and was secretly delighted to have it safely fenced off behind the Iron Curtain.

***

West Germany (1949-90) – Germany shorn of Prussia – was, then, no historical fluke, and nor was the supra­national way it acted. This was the real Germany. But the hasty reunification of 1990 (there was no referendum or election on the issue) changed things. Why should the inhabitants of the former GDR, rather than Poles and Czechs, get immediate access to the wealth and benefits of the West? Because they were Germans. With that, the chancellor Helmut Kohl embraced the notion that being German overrode all considerations of social, economic or historical difference. He also subliminally revived the idea, common to the Second Empire and the Third Reich, that East Elbia was special and needed subsidising by the rich west of Germany. The director of the Bundesbank, Germany’s central bank, resigned in 1991 over this abandoning of economic sanity for political nationalism.

Since 1990, the former East Germany has received more than €2trn from the old West Germany, for a fast-ageing, shrinking and disproportionately male population of only 16 million, including Berlin. That’s the equivalent of a Greek bailout every year since 1990, and as a straight gift, not a loan. This represents a huge shift in financial priorities, overshadowing Germany’s annual net EU budget contribution (currently €15.5bn). In 1990, Kohl promised that western German aid would soon turn the new states into “blooming” areas, but they have become, instead, proof that age-old differences resist even the most gigantic subsidies.

Between 30 and 40 per cent of voters in East Elbia have declared over the past two years that at the general election, they intend to support either Alternative für Deutschland (Germany’s Ukip), Die Linke (heirs to the old East German Communist Party) or the all but openly neo-Nazi National Democratic Party (the NPD, currently represented in the Mecklenburg-Vorpommern state parliament). Though theoretical enemies, these three parties are united by cultural affinities: all despise economic liberalism, oppose Nato and the EU and want closer relations with Russia.

East Elbia no longer has the population to swing the entire German electorate of more than 61 million but many liberal western Germans are nervous. They recoil at the sight of anti-asylum-seeker attacks, which are proportionally far more common in East Elbia than in the west, or when they see Merkel heckled by right-wingers. They call East Elbia Dunkeldeutschland (“Dark Germany”) and joke bitterly that if Britain can have a Brexit, why can’t the old East Germans, whom they lump together under the name of Saxons, have a “Säxit”? But it’s no laughing matter. They know there are those only too aware of any anti-western drift in Germany and eager to give succour to it.

Alexander Saldostanov, the rabid leader of Russia’s “Night Wolves” bikers and a public friend of Vladimir Putin, recently told Germany’s bestselling daily, Bild, that he dreams of a grand union between Germany and Russia: “We have so much in common. You simply have to free yourself at last from America, that scourge of humanity. Together, we can, should and must take power.”

There’s no danger of that, but there is a sense in which eastern Europe is, to Germans, no longer “the other”. It’s the place whence natural gas flows from Russia, where labour is cheap but skilled and where the people are keen to work with Germany on setting up new sites of joint national memory. From Kaliningrad to Prague, museums and projects are springing up in which the horrors of the past are neither denied nor used as ammunition in today’s negotiations. In eastern Europe, perhaps because Russia is so close, the Germans are rarely made to feel guilty for their grandfathers’ sins. Meanwhile in the west, from Greece to Britain, people can’t resist mentioning the war whenever the Germans don’t act as desired.

***

Germany’s resources are not infinite. Nor is the patience of the 40 per cent of Germans who “have net worths of essentially zero”, as Die Welt reported last year – largely because German home ownership rates are the lowest in the EU. They are disproportionately concentrated in the old east, the region that never had supranational, western European connections. From them come ever-louder voices saying that Germany’s EU contribution is too high. And with Britain out, the maths will look even worse to such voters. If south-western Germany’s taxes have to keep bailing out the country’s east, while also helping out the old and new EU lands, what is left for, say, the post-industrial Ruhr, which has financial and social problems of its own? There are tough choices ahead, and it’s not hard to imagine a day when Germany decides to aim its subsidies and investments where they seem most welcome. The old idea of Mitteleuropa – a multi-ethnic, German-centred Middle Europe, neither of the West nor of the East – no longer seems so antiquarian. Nothing would gladden Putin’s heart more.

So, yes, Merkel will win the election and will have a chance to revive the EU’s Franco-­German core. Yet the relative strengths of France and Germany are different now. As for their leaders, while Adenauer was a devoted Catholic Rhinelander, Merkel is a Lutheran vicar’s daughter from the east. Bonn was physically close to Paris, Brussels, The Hague, even London; Berlin is closer to Prague and Warsaw.

With Donald Trump’s wavering on Nato and his noisy anti-German protectionism, along with Brexit, the West may no longer seem vital to Germany’s future. During Merkel’s election debate with her main challenger, Martin Schulz, on 3 September, Brexit was not even mentioned. The old EU core will have to work to keep Germany anchored, resisting any new call from the east. Macron and German liberals know that; that’s why there will be no Franco-German split over Brexit just to sell us a few more Audis. The sooner David Davis and Liam Fox realise that the Germans have far bigger issues to deal with, the better.

James Hawes is the author of “The Shortest History of Germany” (Old Street Publishing)

This article first appeared in the 17 November 2008 issue of the New Statesman, Obamania