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25 January 2023

What Germany gets wrong

The war in Ukraine is among the biggest tests the EU has faced – but instead of showing leadership, Olaf Scholz has floundered.

By New Statesman

In recent years liberals have lauded Germany as a model for other countries to emulate. It has forged Europe’s most successful economy, accepted millions of refugees and, in an era of atavistic nationalism, learned from its history. Rather than building a Germanised Europe, it has sought a Europeanised Germany.

For progressives, who invariably seek utopias, this is a comforting narrative. Brexit Britain, they suggest, need only learn from the continent’s political and economic powerhouse. But in reality, Germany is far from the exemplar that its boosters claim.

The war in Ukraine is one of the biggest tests that the European Union has faced since its creation. Yet rather than showing leadership, Germany has floundered. At the outset of the war, Olaf Scholz, the Social Democratic chancellor, appeared to understand the gravity of the moment. He promised to create a €100bn special defence fund to compensate for the underinvestment in Germany’s military of previous decades, and spoke of a Zeitenwende – the dawn of a new era.

In Ukraine’s hour of need, however, the forces of conservatism have reasserted themselves. Despite months of entreaties from Kyiv, Mr Scholz dithered on sending Leopard 2 battle tanks or approving their transfer by other states. That he delayed for so long shows an utter failure of the European leadership and responsibility that Berlin likes to profess.

In his interview with Bruno Maçães on page 18, Oleksiy Danilov, Ukraine’s national security adviser, damningly observes: “Weak people always come up with excuses in order not to act.” And as our columnist Wolfgang Münchau writes on page 25, Germany “has a long history of fence-sitting in international conflicts… This is not just a political preference. It is a business model.”

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[See also: Leader: The sick man of Europe]

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Germany’s lucrative trade and energy ties with Russia and China have consistently distorted its foreign policy priorities. Gerhard Schröder, one of Mr Scholz’s Social Democratic predecessors, became an outright apologist for Vladimir Putin, as he garnered almost $1m a year through his ties to Russian energy companies. But even the sainted Angela Merkel put commerce before ethics. It was her government that maintained the construction of Nord Stream 2, a new pipeline from Russia, even as Mr Putin annexed Crimea and bankrolled the despotic Assad regime in Syria’s long civil war.

When Donald Trump warned in his speech at the 2018 UN General Assembly that “Germany will become totally dependent on Russian energy if it does not immediately change course”, he was mocked by the seated German delegation. But on this occasion it was Mr Trump who was vindicated.

Though Mr Trump exaggerated his case, by the time of the invasion of Ukraine, Germany was dependent on Russia for 55 per cent of its natural gas, 45 per cent of its coal and around 35 per cent of its oil. Rather than diversifying the country’s energy supply, Mrs Merkel narrowed it by committing to the closure of all 17 of Germany’s nuclear power plants following the 2011 Fukushima disaster in Japan. As a consequence, Germany became Europe’s worst major polluter.

This is far from the only aspect of Mrs Merkel’s legacy that aged poorly. In the early 2010s, by imposing austerity on the eurozone, she immiserated Greece and depressed growth and living standards across the continent. Her dogmatic balanced budget rule, which outlawed deficits of more than 0.35 per cent of GDP, has left Germany with outdated infrastructure, most notably in the digital sector. Low-wage employment and inequality have proliferated and businesses have struggled  to adapt to a new economic era. And her inflexibility helped create the conditions in Britain for Brexit.

It does not follow that other countries have nothing to learn from Germany. Its people enjoy significantly higher living standards than their British counterparts and its workers are far more productive. It has forged and maintained a successful multi-ethnic democracy and embraced a new civic national identity.

But those who champion the German model too often suggest that its achievements are unique and simply ignore its failures. Rather than imploring other countries to learn from Germany, they should occasionally reflect on what others can teach it.

[See also: Leader: The Kremlin’s theory of victory]

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This article appears in the 25 Jan 2023 issue of the New Statesman, Why Germany doesn’t do it better