Europeans, particularly “pro-European” Europeans like me, often make the argument that it is only by pooling their collective resources that can they compete in the emerging world of continent-sized powers such as China, India and the US. By jointly pursuing their interests, the 28 member states of the European Union – the world’s largest trading bloc – can have greater impact than any of them can have individually. In particular, this argument is often deployed to show why it would be a mistake for the UK to leave the EU: to do so would commit it to “geopolitical oblivion”, as a French official put it to me. The idea, in short, is that size matters, as Peter Mandelson put it at a dinner I attended a year or so ago. But interestingly (and perhaps slightly worryingly), this discourse about size echoes the one in Europe at the end of the nineteenth century.
A couple of weeks ago I took part in the Frankfurter Allgemeine Zeitung’s Tendenzwende conference – a small gathering in Berlin of historians, economists, constitutional lawyers and philosophers, that has been held annually since 2009. It is named after a famous academic conference held in 1974, which coined the term that is often used in Germany for the shift in the 1970s from the post-war settlement to a new phase of slow growth and high inflation after the oil shock of 1973. After the financial crisis in 2008, Andreas Rödder (a historian) and Günther Nonnenmacher (one of the five publishers of the Frankfurter Allgemeine) had the idea of holding a similar conference to discuss whether a new paradigm shift was now taking place. The big question was: what comes after neo-liberalism? This year’s conference (which took place under the Chatham House rule) was on Europe.
I’ve recently been having a debate with Josef Janning of the German Council on Foreign Relations (DGAP) about German power in the European Union. In May Janning published an article on DGAP’s website in which he challenged the assumption that Germany was “calling the shots” in the EU and attempted to quantify various dimensions of member-state power. In my response I argued that Janning underestimated Germany’s power as the eurozone’s largest creditor and also stopped short of spelling out the implications of his correct but rather alarming conclusion that other member states could outvote Germany if they joined forces – in effect an anti-German coalition. In his response to me, Janning argued that I overestimated German power within the EU by too narrowly focusing on the euro crisis and disregarding British and French military capabilities. In my second response, I argued that although military capabilities allowed France and the UK to project power beyond Europe, they are not a source of leverage within Europe.
There are multiple ways of looking at the euro crisis. Northern Europeans in general and Germans in particular tend to look at it as a crisis caused by fiscal indiscipline by southern European countries in general and Greece in particular, who didn’t stick to the rules. Others, particularly in France, look at it above all as a crisis caused by unregulated financial capitalism, which created banks that were too big to fail and therefore had to be bailed out by governments. Others still, particularly in the UK, look at it above all as crisis caused by the flawed architecture of the euro itself – a common currency without a common treasury – which meant it could never work. But if you take an even longer view, it’s also possible to see the euro crisis as the unforseen consequence of German reunification.
Over the last few months, Germany has been getting a lot of flak. To many observers, the euro crisis has revealed a more inward-looking and nationalistic Germany that is pursuing its national interests more aggressively than before. For example, a couple of weeks ago the philosopher Jürgen Habermas wrote of a “solipsistic mindset” in Germany. In the new issue of the magazine Cicero, which came out yesterday, another éminence grise, the former chancellor Helmut Schmidt, accused Angela Merkel of “Wilhelmine pomposity”. I agree that there is a profound, and in some ways worrying, shift taking place in German foreign policy. But, as I argue in an essay in the July issue of Prospect, which comes out today, it is a complex shift that actually goes back beyond Merkel to the “red-green” government of Gerhard Schröder. I also think the references to the Kaiserreich are a little misleading. If Germany is becoming more nationalist, it is in a quite different way than in the nineteenth century.