Opinion Angela Merkel, Queen of Undesired Compromise

German Chancellor Angela Merkel is introducing a new economic stimulus package -- but her heart is not in it. What counts for her is that she has a result. It doesn't matter what it is. It is typical of a chancellorship that searches for harmony but lacks leadership.


It was nothing more than a spiteful jibe -- but it has turned out to be an accurate prediction. The disparaging remark was made by Edmund Stoiber, the former governor of Bavaria who was Merkel's rival for the chancellor candidacy. When Merkel took office in October 2005, Stoiber said that as the head of a grand coalition of Social Democrats (SPD) and her own Christian Democrats (CDU) her authority to dictate policy guidelines would be limited.

Stoiber wanted to hurt Merkel, to undermine her authority right from the outset and now, in retrospect, he seems to have been something of a prophet. After over three years of Merkel as chancellor, Article 65 of the German constitution has been reduced to a museum piece: "The German chancellor determines policy guidelines and bears responsibility for this," reads the text. But no one takes that seriously these days.

German Chancellor Angela Merkel.
AP

German Chancellor Angela Merkel.

This lack of leadership was already evident in Merkel's meager reforms and now it has returned with the economic stimulus package. This may be the right approach and provide the only hope to ease the recession. But how did this initiative come about? How much "Merkel" does it contain?

Last Wednesday morning Merkel spoke to the German parliament, the Bundestag, about the largest economic stimulus package of the postwar era during the largest economic crisis of the past 80 years. It was one of those few occasions when it is vital to deliver a convincing speech, and Merkel did her best. She intended to do more than present the usual list, a litany of her policies. No, she endeavored to convey a message. But it remained a hopeless attempt.

Afterwards, the parliamentary floor leader of Merkel's conservative Christian Democrats, Volker Kauder, clapped his hands with exaggerated movements. He then turned around to look at his fellow conservative members of parliament. They understood the signal. It meant he was checking to see who was not applauding.

It would of course have been embarrassing if the chancellor's own parliamentary group had stopped clapping after just 20 seconds. And that could well have happened. Many CDU parliamentarians can sense that the chancellor has never really found her bearings in this crisis, never established a platform that she could securely stand on. The way she trundled through the speech reflects how she has been trundling her way through the entire crisis.

Leader of the Waiting Game

A major crisis actually presents an opportunity for a chancellor. Everyone is at a loss, everyone is plagued by uncertainty, and virtually everyone is waiting for someone to take charge. And what has Merkel done? She has joined those who are waiting. She has become the leader of the waiting game.

At the beginning of the crisis the chancellor was against a massive stimulus package, she was against lowering taxes, and there are arguments in favor of these positions. People can argue over positions, but Merkel didn't really take sides. Even as late as December, she was keeping all her options open. She said that a major stimulus package was out of the question for the time being -- perhaps later, perhaps when Barack Obama takes office. But she couldn't say what benefit could be derived from this.

Others used her indecision to take charge and chart the political course. There was French President Nicolas Sarkozy with his criticism of Germany's hesitation, and there was Bavarian Governor Horst Seehofer with his calls for lower taxes.

What did Merkel do? She gave in. She allowed large amounts of money to be invested in road construction, although she doesn't believe that this is a very effective measure. She allowed taxes to be reduced, although she thought that it was the wrong time to do so. She allowed a great deal. In most cases, she did the right thing, but why did she wait so long? And why has she never really explained her change of heart? She simply caved in, without protesting.

Almost everyone gets a piece of the pie from Merkel's administration, at least if they yell loud enough. Higher taxes for the rich was the only major demand that was rejected. If Merkel had been more compliant here, it would have erased virtually all ideological differences between the conservative CDU and the left-leaning SPD. They might as well have merged into a Grand Social Democratic Party of National Unity.

Last Tuesday, Merkel gave a press conference where she outlined her stimulus package together with Deputy Chancellor Frank-Walter Steinmeier, a member of the SPD, and CSU leader Horst Seehofer. Her presentation droned on and on. She spoke of measures which could be classified according to different areas. The chancellor piled on detail after detail, her crisis management had points and subpoints. But there was no recognizable guiding concept.

A journalist wanted to know if the chancellor favored the government investing not only in banks but also in industrial corporations. "I see no investment measures for this nationwide program," Merkel said cryptically. But are you personally in favor of this? It was not possible to get a clear answer from Merkel.

Avoiding Conflict

The leader of the CDU, Germany's largest conservative party, must be extremely unsure of herself if she cannot even rule out the nationalization of the means of production. The previous weekend, when the CDU had met for its national leadership conference in Erfurt, there had been a short debate on the issue. The governor of Lower Saxony, Christian Wulff, called for the party leadership to come out against the state investing in companies. His counterparts Jürgen Rüttgers from North Rhine-Westphalia and Roland Koch from Hesse wanted to keep the possibility open.

Merkel remained silent. She essentially wanted no losers. If she had taken Wulff's side, whose view she shares, Rüttgers would have been dissatisfied. So the CDU issued a closing declaration that left everything open. Merkel left it up to the SPD to bury the topic in the coalition committee.

Right and wrong are secondary categories in Merkel's way of thinking. Her actions are aimed at avoiding conflict, among the ranks of her own party and in the coalition. Conflict tarnishes the chancellor's reputation. Harmony, on the other hand, is good -- which explains why Merkel wants harmony at any price.

This makes her vulnerable to pressure. Whoever is prepared to risk a conflict can back her into a corner, as Rüttgers and Seehofer have done.

Instead of fighting for her own causes, she sends others into the fray. In the coalition committee, CDU parliamentary leader Kauder had to struggle alone against the so-called scrapping bonus -- an SPD proposal to allow car owners to receive a cash rebate when they trade in their old model for a new vehicle. Hardly anyone among the conservatives, including the chancellor, sees this is an appropriate means of kick-starting the economy. But resisting the idea would have meant a conflict with the SPD -- and with the lobby for the automotive industry, which Merkel also fears.

Many in the CDU have asked themselves whether Merkel has already compromised the party to such a degree that she can no longer credibly represent the conservative party's core issues. A major tax reform -- like the one that the chancellor intends to make a key issue in the upcoming election campaign -- cannot be seriously pursued in view of the anticipated mountain of debt. When it comes to tax policy "the CDU looks to some extent as if it has been forced onto the defensive," says Saarland Governor Peter Müller.

A Motley Collection of Grudging Good Deeds

The most painful criticism of all comes from someone close to the chancellor. Last Monday, Norbert Röttgen, chief whip for the CDU/CSU group in parliament, made a dig at Merkel's style of politics, without actually mentioning her by name. Röttgen said that even at a time of crisis there could be no lack of a "structured approach" among the leaders of the conservative parliamentary group. He said that the party's policies must make it clear that there are red lines which no one may cross. On the other side of those lines, he contended, lay policies like granting bailouts for individual industries or exceeding the Maastricht criteria for government debt. It seemed as if there were no longer any limits, he said. Merkel tersely thanked Röttgen for his comments.

But she is well aware of this herself: Merkel is the queen of allowing the unwanted to happen. Last year, when she scrapped her proposals for a new pension formula, she said that it was "no great policy masterpiece." She has extended the eligibility periods for unemployment benefits, although she does not think that this is an appropriate measure. She allows one minimum wage agreement after another to go through, although she favors another model.

Now comes the economic stimulus package, which combines all the qualities of her entire chancellorship: It is a large motley collection of grudgingly approved good deeds. Looking back on the results of her own administration, Merkel must feel about as comfortable as a Bayern Munich soccer fan sitting in the section for supporters of arch-rival Schalke 04.

But she endures this. What counts for her is that there is a result -- but it doesn't matter what it is. Merkel's style of governing based on restraint at all costs -- her relentless yielding -- has secured the existence of the grand coalition. And stability itself is an asset.

But why has she never fought? Why has she never insisted on her authority to dictate policy guidelines? She could have always conceded defeat in the end, after a big fight, of course. "Well done," people would have said.

She's simply not interested. Big, open conflicts are not in her blood. Merkel is not a policy maker, she is the harmony chancellor. During her chancellorship leadership has been sacrificed to governability -- and to the hope of being re-elected. With a new coalition partner, the pro-business Free Democratic Party (FDP), everything will surely be different. But who still believes that? Only Merkel.

Currently, she's feeling great. Last Thursday she received British Prime Minister Gordon Brown at the Chancellery. He had reportedly been critical of Merkel's hesitancy. Now they get on splendidly. Merkel was bursting with joyous relief.

Time and again her staff had stressed how courageous it was of the chancellor to resist the international pressure. That no longer holds true. With the stimulus package, Merkel has finally joined the rest of the crowd. That's where she feels most comfortable.

Translated from the German by Paul Cohen

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