19 February 2013

Ulrich Speck: Germany must decide the power it wields

So far Germany has used its new powers rather negatively: vetoing initiatives and delaying change. Its goal, more felt than explicitly stated, has been to keep the old order intact. Regarding the EU, Chancellor Angela Merkel tries to reassure markets that Germany is fully behind the euro, while at the same time signalling to Germans that they will not have to bail out southern Europe. The chancellor talks of “more Europe”, promising to rebuild the EU’s institutional structure to better embed the common currency. But what is missing is a broader vision of a renewed EU, and a plan of how to get there. When it comes to concrete steps such as banking union, Germany is keen to keep control and has offered only minimal concessions...

Germany is gambling that it can somehow keep the status quo, but this is a risky bet with many unpredictable factors. Markets might again lose trust in the euro; Britain might move further towards the exit; the Middle East could erupt in further conflict; Russia’s decline might lead to new tensions; strategic competition between China and the US could force European powers to take sides.

Put differently, the past may no longer be a guide to the future. Germany must make up its mind on the big strategic questions – and act more decisively. Simply muddling through will damage vital longer-term interests such as European stability and prosperity. The order on which Europe’s postwar success was built is eroding, and Germans and other Europeans must become more active players in shaping a new order that fits the challenges of the 21st century. Neither the existence of the EU as a major trust-building mechanism nor US willingness to underwrite security in Europe and its neighbourhood can be taken for granted.

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