Will Germany fill the void?

Germany is currently the darling of the liberal world. With Britain and America delighted with their navel gazing many have turned to Angela Merkel and her compatriots to defend internationalism.

National pride on the world stage is unfamiliar to modern Germany. It is less than 28 years since the fall of the Berlin wall; unified Germany is still young. Germany’s unique past also makes some reticent to stand tall. It was not until the football world cup in 2006 that Germans were proud to wave their flag. 2006 gave Germany the chance to show itself to the world, and for Germans to be proud to be there.

10 years later Germany is back at the forefront of the world stage as president of the G7 and G20. As world leader Angela Merkel lauds the value of international trade and globalisation; and of working together to solve global problems — she has been particularly forceful on climate change, supported by a resurgent France. But Merkel’s language has been about Europe not Germany. She recognises that a German voice alone will not be heard above Trump or Xi.

“Europe must take its fate into its own hands”

Germany is pushing the G20 for an African Marshall Plan, stabilising a region ravaged by conflict. This is in part a response to Merkel’s continuing issue with migration domestically, and is an attempt to stop flows to Europe. Germany are also promoting an African Partnership, a campaign for private investment in Africa, and an African digital strategy. This approach is ambitious but could spread resources thinly, reducing impact, and is at risk of being uncoordinated. Unlike USA in the late 40s, Germany lacks the clout to rebuild a region alone. Merkel’s power will be shown by her ability to bring others on board.

Germany takes development seriously. They are a leading funder of the Coalition for Epidemic Preparedness Innovations, are champions in tackling anti-microbial resistance and are committed to spending 0.7% GDP on aid.

Germany is a world-leader in science and innovation. Organisations like the Max Planck Society are flourishing and think-tanks are flocking to Berlin to be close to a government they believe will listen. Their standing is only likely to grow. The UK is likely to lose at least some of it’s prestige as a base of scientific excellence, helping German institutions attract more funding and ultimately more talent. A commitment to spend 3.5% GDP on R&D is turning Berlin into the new home of global health. The reopening and expansion of the Humboldt centre will also do wonders for public engagement in a city with an already strong tourist base. Research is great for soft power. It attracts future global leaders to study and allows countries to spread their culture through other channels. Research collaboration also spills over into international relations in realms like defence, climate change or health security. Ultimately research will deliver innovation that others want to access.

Whilst the research environment is strong, German universities are less so. In the most reading QS world university rankings, Germany has only three universities in the top 100, and none in the top 60. More domestic investment in teaching, and university infrastructure is needed for Munich to compete with Oxford, Harvard or MIT.

Munich Technical University

This is a symptom of a wider problem. Germany doesn’t spend enough. The austere German is a stereotype, but it rooted in the truth. Germany focuses on exports above the domestic market. Suppressing labour rates makes its products globally competitive but leaves little for investment. This unbalances global trade, but also affects German standing abroad, brooding negative sentiment within the EU. German productivity is high for now, but the country is starting to feel the effect of poor investment. Digital infrastructure is in desperate need of updating, as recent hacks on the Bundestag IT system show. Schools and public buildings are dilapidated, and consumption is low. Better investment in people and infrastructure will spur the domestic market and relieve foreign tensions but the Mittelstand remain focused on foreign markets first.

Beyond a flagging IT system, German attitudes to data could also hold it back on the world stage. The cliche is that data is the new oil. Smarter ways to use data in public services, marketing and more are revolutionising everyday lives. Countries need to adapt, and develop laws and regulation that keep public confidence high but promote innovation. This is difficult in a country scarred by domestic intelligence and political police. Broadly the German public do not want the government, or others, to hold their data or use it for any purposes. This could hold Germany, and Europe back, in creating a thriving digital economy, and promoting safe effective regulation abroad.

Germany lacks traditional hard power. The Bundeswehr, their unified federal army, are woefully under resourced. The current 1.2% GDP spend on defence is far below the NATO 2% target. An international training run in 2015 left the Bundeswehr embarrassed as they were forced to use painted broomsticks to replace the machine guns they were unable to afford. This is unlikely to change. Germans are extremely reluctant to support their army. Understandably their history make them wary of powerful armed forces. As a parliamentary army they are also unable to react quickly to military situations. Decision making is taken by parliamentary votes, not autonomous commanders like in America.

Hawkish Germans are happy with the recent progress of the European Common Defence fund. This united approach could increase the blocs hard power. Brexit could also mean the research component is a boon to german business. Germany is smart to push the EU to move in directions it cannot domestically.

German energy policy has caused it problems internationally. When the country hurriedly closed their nuclear power stations, following Fukushima, it became dependent on Russian natural gas imported via the Nord Stream pipeline. Solar and wind energy have flourished in Germany but they are inconsistent and a population of nearly over 80 million needs consistency to prevent blackouts. While Merkel has led the West in pursuing economic, and political sanctions on Russia, she is still reliant on them. Nord Stream 2 is causing Germany significant foreign policy problems. 13 EU countries have claimed it is distorting energy trade away from them, undermining the energy union, and locking the EU into Russia for many years. The new pipeline will also divert flows away from Ukraine, reducing their income and isolating them politically. The US are up in arms for the support it gives Gasprom, the state owned Russian supplier. Germany may be the leader of the West, but their foreign policy will still be dictated by domestic priorities.

Angela Merkel is the epitome of strong and stable. Chancellor since 2005, it is more than likely she will guarantee another four in September’s federal elections. She has seen off a swathe of domestic rivals, both within her own Christian Democratic Union, and their rival SDP. Macron is her fourth French counterpart, with Paolo Gentiloni her eighth in Italy. Her crisis management, clawing back from low-points like the refugee crisis in 2015, and ability to balance arguments to command public opinion is exemplary. Her fluent Russian, and stoic attitude also mean she is one of the few world leaders who is willing to be take a hard line in person with Putin.

But her international profile does not completely reflect domestic actions. Observers forget that she is a Christian social conservative. The recent vote on gay marriage was a political calculation in the face of pressure from the left, not taken to uphold liberal values. It was a principle she voted against. Yes her attitude to globalisation and trade are liberal, but socially she is restricted by her party, and their even more conservative sister party the CSU.

Germany can and will do more on the world stage. Not least because anti-Trump sentiment is playing extraordinarily well for Merkel with the German public. But what Germany truly does get, that the UK never did, is that alone on the world stage it is small. 81 million people is a quarter of the US. It’s economy is the fourth largest in the world, but that is a third the size of China, and likely to be overtaken by more. It’s soft power and cultural influence are still behind former colonial powers like France, Britain and Russia.

Have you met Angela?

Germany knows that to lead it must do so through the EU. One of the CDU’s manifesto taglines is “a strong Europe means a strong Germany”. Germany know that the EU’s size and influence brings prosperity home, and allows it to punch above it’s weight in foreign policy and trade. They will though be grateful to a growing, and more responsible France, to ease pressures and reduce anti-german feeling within the EU. Many Member States already perceive the EU to be a German project. Much of German foreign policy efforts will be spent showing how German interests are also Europe’s.

For liberals Germany is seen through the bottom of a stein glass. The dregs of weissbier blurring some of it’s more conservative, or nationally driven policies. Too much weight is also put on one person, Merkel like Obama is a talented, intelligent and internationalist politician, but she will not be around forever. Recent chancellors like Kohl and Schroder show that Germany isn’t a one trick pony. But a shift in public attitudes or revolt from her Bavarian partners could put her in a fix domestically, and affect her international standing.

While Germany should be cheered throughout, and beyond, their G7 and G20 presidencies, liberals should not forget that it is the EU27 and not the E1 who have the global influence.

N.B. The Economist, and their excellent German correspondent @jeremycliffe published a very similar (and better) article as this one was being written . His Kaffeeklatsch blog is still the premier location for German insight.

If you liked this please recommend and share and check out my other pieces like this