By Mathew D. Rose, a freelance journalist in Berlin, and cross-posted from Naked Capitalism
There seems to be a concerted effort in German politics and media to unseat the nation’s chancellor, Angela Merkel. It is difficult to say exactly when things started to go wrong for Ms Merkel, yet in retrospect she has been careening from one crisis to the other for a couple of years. The incipient moment was probably the euro crisis, but Merkel’s watershed was doubtlessly Germany’s calamitous political intervention in Ukraine. Since then things have gone steadily downhill. With her newest crisis, refugees and immigrants, Ms Merkel is being portrayed as out of touch with her party, her people and reality, but even worse, as rather ridiculous. The latter is something that no leader can permit to occur.
That Ms Merkel ever became chancellor was a political quirk; that she has remained in office a truly impressive feat. Following re-unification the East German Merkel joined the Christian Democratic Union (CDU) and was elected to the Bundestag. The chancellor at that time, Helmut Kohl, appointed the political novice Merkel as Minister for Women und Youth, a rather innocuous posting. For Kohl, Merkel fulfilled three important qualities: she was from East Germany, a woman and not seen as a political threat, a reliable party underling. Kohl referred to Merkel condescendingly as “my girl”. Following Kohl’s retirement in 1998 Wolfgang Schäuble became CDU Party Chairman and was destined to be the CDU’s candidate for chancellor in the upcoming bundestag election. To keep any potent male competition in the party in check, Schäuble selected the bland Merkel as CDU Secretary-General.
1999 however saw Kohl and Schaüble caught up in a massive party funding scandal. Although the affair was swept beneath the rug, following Schäuble’s resignation as party leader, it was clear that his candidacy for chancellor was no longer on the cards. In fact, aware of an imminent backlash from voters at the next election, no one wanted the post as party leader, which includes the candidacy for the chancellorship, so it was given to Merkel. The CDU male grandees assumed they would have no problem unseating her as party leader following her inevitable election defeat. As fate would have it, the leader of the CDU’s Bavarian sister party, the Christian Social Union (CSU), claimed the nomination. The CSU is a provincial party that produces hordes of mediocre politicians, who rule via corruption and nepotism and an extremely suspect justice system. Every thirty years a CSU politician believes he is ordained to be chancellor of Germany. Not taken seriously by the rest of the nation, they go on to lose.
This bumptious intervention by the CSU, ending in the inevitable defeat of their candidate for chancellor, was a godsend for Ms Merkel, leaving her in a strong position. Her male competitors for the party leadership were not able to find a consensus candidate, their personal ambition impeding each other, so Ms Merkel remained politically unscathed.
In the next Bundestag election in 2005 Ms Merkel may have cut a very poor figure as the CDU/CSU candidate for the chancellorship, appearing incompetent in financial matters, and squandering a massive lead in the polls, but her party narrowly edged out the Social Democrats. The two struck a deal to share the spoils and formed a grand coalition with Merkel as chancellor.
Merkel followed the CDU tradition of permitting big business to determine policy and converting this into law. The grand coalition was the golden age of donations and sponsoring by large corporations for the CDU, CSU and Social Democrats. Many politicians in the ruling coalition benefitted personally from this munificence. There were bountiful consulting-contracts, generously remunerated seats in supervisory boards of companies and exceptionally well paid jobs after retirement from active politics, not to mention bribes
There was one exception, however. The nuclear disaster of Fukushima occurred shortly preceding a state election in Baden-Württemberg, the CDU heartland. Despite the majority of Germans being increasingly disenchanted with nuclear energy, Ms Merkel had just revised a law phasing it out by 2021, extending the date well into the future, as proscribed by Germany’s four major energy providers. Merkel knew that her party, as a dogmatic supporter of nuclear energy, would suffer serious damage in the upcoming election in Baden-Württemberg and made a remarkable volte face, more or less reinstating the original law to phase out nuclear power stations within ten years.
It was the right call. The CDU suffered a serious electoral defeat in the Baden-Württemberg, but it could have been much worse. The CDU and CSU Union had always fervently supported the nuclear industry (and the nuclear industry the CDU and CSU), and while Merkel’s decision was politically clever, it egregiously violated party dogma. It was the left (the Social Democrats were also dogmatic proponents of nuclear energy) that had fought the nuclear lobby tooth and nail for decades. Many in Merkel’s party never forgave her.
During the financial crisis, Ms Merkel did what big business asked of her: bailed out the banks, letting the taxpayer foot the bill, and the state pumped further billions into the automobile industry. This seemed to have done the trick and seemed to have restored her fortunes.
Then in 2009 Merkel committed her first cardinal error, appointing Wolfgang Schäuble as finance minister. Schäuble is a man characterised by spiteful hate, belief in German superiority and fervent loyalty to Germany’s wealthy. He was instrumental to the introduction of austerity in Germany and Europe, which encompassed all these qualities.
While China, the United States, Britain to name a few, spent vast amounts to stimulate their economies, Germany abstained, enjoying the free ride. When in 2009 many European banks, including those in Germany, fell into a financial abyss, it was the high priest of austerity, Schäuble, and his acolytes who transubstantiated this into a sovereign debt crisis driving nations like Greece, Ireland, Portugal, Spain and Italy to the financial brink, replacing democratically elected governments by decree and attacking one of Europe’s great achievements, its social welfare system…