Daniel Troup Eastern Europe and Russia Western Europe

The Risks and Rewards of Merkel’s Eurozone Policies

Angela Merkel’s resounding victory in the recent German elections has sent a clear signal to the rest of Europe: The German Public is willing to support their country’s continued management of the region’s economy, despite the political turmoil of the past few years. The country has emerged as the indisputable centre of both power and stability on the continent, and its citizens have benefitted from their government’s ability to manage an entire region in the interests of a single state. Grappling with the Eurozone crisis has been a political challenge, and led the German government to pursue some unpopular policies, but its behaviour has never compromised the economic interests of its own country.  Many will attribute Merkel’s victory to her government’s strong pragmatist bent and calculated political decisions, but it must also be remembered that geopolitical circumstances have facilitated Germany’s leadership. While this arrangement has evidently satisfied the German polity, the rest of Europe is another story.

Merkel’s domestic popularity is unsurprisingly not matched in the peripheral European states that have had to endure years of harsh austerity. The veneer of multilateral institutionalism provided by the Troika, composed of the International Monetary Fund, European Central Bank, and European Commission, has done relatively little to shield Germany from criticism or convince anyone it is not the driving force behind Eurozone crisis management measures.   Merkel’s government is no doubt accustomed to the invective that tends to emanate from certain segments of the peripheral populations. People are frustrated with their declining fortunes, and argue that the German-led management of the crisis has unduly damaged their economies and societies with deleterious human consequences. Such discontent is the predictable backlash of a self-interested state managing an entire region, and exposes the structural incongruity of Europe’s unequally integrated system of international relations. Those who feel Merkel’s government could have taken a different, more measured, and less socially devastating approach are correct, but this is not its primary task. Its main job has been to manage the crisis according to what is best for Germany. Of course, there is some debate as to what this should entail, but the fact remains that so long as the German government wields such disproportionate influence, its interests will shape the trajectory of Europe as a whole.

[captionpix align=”right” theme=”elegant” width=”300″ imgsrc=”http://natoassociation.ca/wp-content/uploads/2013/10/angg.jpg” captiontext=”Merkel’s government has been rewarded for staving off domestic grievances and the political consequences they entail”]

Until now, Merkel and her government have typified and personified what many Europeans see as the stripping of their democratic rights. An understandable opinion since their fiscal policy is more or less being determined by foreign officials. This has been a source of tension throughout the world when structural adjustment programs are administered by unelected technocrats. What makes this case different, however, is the fact that Merkel’s government has been elected, which would typically be its source of legitimacy. But these were national elections and only German’s had a vote, an opportunity they used to endorse a government and leader that has become a symbol of disenfranchisement for populations of the European periphery. This outcome risks transforming hostility towards the German government and its leader in particular into a more generalised resentment defined by the region’s national divides. This is particularly troubling in combination with the conditions in at least one peripheral country, Greece, which now seems on the precipice of even more social and political upheaval.

Since the beginning of the Eurozone crisis, the German government has had to carefully balance domestic politics with its international imperatives. Its ability to do this from a position of strength within Europe has allowed it to prioritize the immediate well-being of its citizenry even as it imposes austerity on others. Although its electoral victory is being celebrated, its sizeable democratic mandate presents new challenges. Merkel’s government has been rewarded for staving off domestic grievances and the political consequences they entail, but as Germany continues in its role as Europe’s most powerful and influential state, foreign grievances may become more pressing especially if nationalist elements take hold and the frustrations of the periphery become more generalised and more politicised. As a result, complacency would be ill-advised and the German government may need to adapt to evolving circumstances if this current period of relative calm proves fleeting.

Daniel Troup
Daniel Troup is a graduate of the Peace and Conflict Studies program at the University of Toronto’s Trudeau Centre. He has experience as a research assistant in the University of Toronto’s Department of Political Science and has most recently worked as a research associate for the UN-based Global Policy Forum. His research interests include the political economy of peace and conflict, Latin American and European politics, as well as international relations theory.