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Thu Nov 26, 2015, 05:30 PM


Mathew D. Rose: The Ordeal of Angela Merkel

By Mathew D. Rose, a freelance journalist in Berlin


...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.

Schäuble saved German, French, British and other banks from collapse and provided a discredited neo-liberalism with a fillip, but he also drove millions of Europeans into penury, many to an early death for lack of adequate medical attention, not to mention suicide. The crisis however was great stuff for Germany, which enjoyed the trade advantages of a weak Euro, inexpensive labour from Europe’s newly created army of unemployed and cheap borrowing on the bond markets. Add to this the sinking real incomes of the previous ten years in Germany and you have a recipe for financial success at the cost of everyone else: destructively high current account surpluses.

While the question of austerity and Europe’s and Germany’s anaemic economic recovery was reduced to an academic war of words, Merkel committed her first major error: Ukraine. One does not need to be a foreign affairs expert to know that peace and stability in Europe depends on the integration of Russia. The two sides had made great progress in the previous quarter century. Ukraine could have been a further stepping stone in this process as a trade hub between the EU and Russia. German hubris, having been declared the “leader of Europe” due to its financial predominance, and historic German racism with regard to Slavs, led Merkel to inanely join the US attack upon Russia by prying Ukraine loose from its traditional bond with its eastern neighbour, instead of doing what Europe traditionally does so well in such situations: mediating a compromise to its own advantage.

One should also not forget that what oil was to the intervention in Iraq, fertile agricultural land is to Ukraine. The German media went into war propaganda mode. The result was a botched affair: a new war in Europe, a failed state, a loss of Russian trade and the need to subsidise a corrupt oligarchy for many years to come. Still, it was “mission accomplished”. Most Germans once again had the feeling of having an existential threat on its eastern frontier and with Vladimir Putin possessed a devil incarnate. Life was once again “in Ordnung” as the Germans would say...


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