The United States, Germany and the New Balance of Power in Europe

The United States, Germany and the New Balance of Power in Europe

Theme: US President George W Bush met with the new German Chancellor Angela Merkel at the White House on 13 January.

Summary: The meeting paved the way for an easing of tensions between Germany and the United States after three years of friction. In what Merkel called the opening of a ‘new chapter’ in US-German relations, she promised to work closely with Washington to achieve a common approach to the nuclear crisis in Iran. The two leaders also laid the groundwork for greater cooperation in the war on terror. And in an important shift in German policy, Merkel proclaimed that ‘NATO is the forum’ for transatlantic discussions about security. As American strategists digest all the good news, however, they will be most happy about her indirect repudiation of the long-standing Franco-German axis. Merkel’s efforts to strengthen Germany’s bilateral ties with pro-American allies such as Britain and Poland will restore to Berlin its traditional role as mediator between Europe and America. Merkel’s ascendancy will therefore re-establish a healthy balance in Europe, one that is Atlanticist in outlook.


A New Chapter
German-American relations took an important step forward on 12/13 January when German Chancellor Angela Merkel made her first official visit to Washington DC. There was a strong mutual interest in a positive outcome, and the White House went out of its way to make Merkel feel welcome. More than 200 of Washington’s political and foreign policy elite attended an elaborate dinner held in her honour, and Merkel was invited to spend the night at the historic Blair House, the presidential guest residence facing the White House. After having breakfast with members of the US Congress the following morning, Merkel set the tone for a more relaxed era in bilateral relations by abandoning her motorcade and walking to the White House for a 45-minute one-on-one meeting with US President George W Bush.

Relations between Germany and the United States have been strained since Berlin, under former Chancellor Gerhard Schroeder, joined Paris in opposing the US-led invasion of Iraq. Schroeder’s schizophrenic preoccupation with Germany as a ‘normal country’ and its new-found post-Cold War ‘self-confidence’ in international affairs annoyed Washington, and his uncritical embrace of Russia at the expense of American allies in Eastern Europe added to the antagonism. But his opportunistic playing of the anti-Americanism card to ensure his re-election in 2002 is what made Schroeder, who speaks no English, even more loathed at the White House than French President Jacques Chirac, who does.

In sharp contrast, Merkel’s centre-right leanings make her a natural ally of the Bush Administration, and both Bush and Merkel have already signalled their desire for a close personal working relationship. Their first meeting exceeded initial expectations, and the two leaders exuded warmth and personal chemistry during a joint press conference afterwards. Bush lavished Merkel with political affection and said his first impressions of Merkel were ‘incredibly positive’. Merkel reciprocated by displaying a conciliatory attitude toward the United States, and emphasising that ‘we have a lot in common’.

Bush and Merkel sought to make clear that US-German acrimony over Iraq was a thing of the past, and that a new era in bilateral relations has begun. In forceful language that was sure to please Bush, Merkel spoke of confronting global challenges ‘head-on’. They then identified areas where American interests converge with those of Germany. Foremost among these, they agreed to work together to defuse the nuclear stand-off with Iran. ‘We will not be intimidated by a country such as Iran’, Merkel said. She also offered to provide more help in Iraq.

Moreover, Merkel reassured the White House of her free-market inclinations, following a bizarre election campaign in which some of her coalition partners compared American investors in Germany’s ailing economy to a ‘plague of locusts’. Elsewhere, those in the US Congress and at the Pentagon who are wary of Beijing will have been pleased by her remarks that ‘we have competitors like China who don’t abide by any rules’.

Even in areas of lingering disagreement, the two leaders were non-confrontational. They agreed to disagree over Guantánamo Bay, the US detention centre in Cuba that Merkel said should be closed. After Bush replied by saying it would remain open because ‘it is a necessary part of protecting the American people’, Merkel called on Europeans critical of how the United States handles terrorism detainees to suggest reasonable alternatives.

A Return to Atlanticism
But White House strategists will focus mostly on how Merkel rebalances Germany’s relations with other countries in Europe. Much of the US hostility to Schroeder stemmed from his highly personalised style of conducting foreign policy, which many analysts say upset the traditional balance in German diplomacy. Because of his close personal friendship with Chirac and Russian President Vladimir Putin, Schroeder, against the advice of his most senior advisors, freelanced German foreign policy away from the historic transatlantic alliance, and tilted it instead towards Russia and France in a clumsy attempt to create a counter-weight to American power.

By contrast, Merkel is already nudging German foreign policy back into the American camp. As re-unified Germany’s first leader to have grown up in the formerly Communist part of the country, Merkel is inherently more sceptical about relations with Russia than was Schroeder. Indeed, during her first official visit to Russia on 16 January, Merkel signalled her intention to ‘de-Schroederise’ Berlin’s relations with Moscow; from now on, she implied, Germany’s previous ‘friendship’ with Russia will become a more formal ‘strategic partnership’ instead.

Germany has a strong economic interest in Russia, especially in the energy sector, and Merkel will be keen to maintain good relations with Moscow. Germany depends on Russia for about one-third of its natural gas supplies, and the International Energy Agency expects this dependency, already the highest among large western European nations, to reach well over 50% by the end of this decade. Merkel thus has a compelling interest in ensuring Russia’s long-term reliability.

While chancellor, Schroeder signed a controversial deal with Putin to build a gas pipeline that will directly link their two countries under the Baltic Sea. But after Russia in late December cut supplies of natural gas to Ukraine, which then snowballed into an energy crisis for the rest of Europe, Germany was suddenly faced with the uncomfortable realisation that its energy supplies are at the mercy of the Kremlin.

Merkel says that she will honour the pipeline agreement with Russia, but many Germans are now calling for the urgent diversification of their energy supplies. The government is even talking about extending the lifespan of German nuclear power plants, which in effect would reverse Schroeder’s populist decision to phase out nuclear power by 2021.

Germany’s relations with its smaller allies to the east, especially with Poland, have also suffered badly because in dealing with Russia, Schroeder often seemed to disregard their interests. The new gas pipeline will deliberately bypass small countries in Eastern Europe, thus depriving them of badly needed pipeline transfer revenues. The agreement also undermines previous land-based gas pipeline projects running through Lithuania and Poland.

Merkel travelled to Warsaw almost immediately after becoming chancellor with the aim of defusing Poland’s anger over the Schroeder-Putin agreement. Poland has already called on the European Commission to consider alternatives to the pipeline route. Warsaw remains deeply suspicious about secretive deals between Moscow and Berlin.

Indeed, sixty years after the end of World War II, tensions between Poland and Germany still linger close to the surface, and Schroeder’s incendiary rhetoric that his country would follow a Bismarckian deutscher Weg (German way) only added to the unease in Eastern Europe. By contrast, Merkel says that from now on Berlin will pay far more attention to the concerns of its neighbours before it formulates policy toward Russia.

In this context, Merkel also believes the historically important Franco-German axis within Europe is too dominant and must be recalibrated so that newer EU members have more say. Contrast this with Chirac, who told them they ‘missed a great opportunity to shut up’ for siding with America on Iraq. In fact, Chirac and Schroeder plotted a concept of Europe as a pole in opposition to the United States, even though many EU member states are also allies of America. At one point France and Germany even warned Poland that it could lose financial help from the EU in the coming years if it stood in the way of their plans for Europe’s future. Indeed, the heavy-handed Franco-German tactics backfired by doing more to divide Europe than to unite it. They also damaged the Atlantic Alliance by undermining the reliability of its European members.

By loosening German ties with the fading reign of Chirac, Merkel is acknowledging the fact that Europe is most unified when all of its members have stable relations with the United States, and that Europe will be most successful as an independent global actor when in cooperation with, not in opposition to, America. That lesson has not been lost on Nicolas Sarkozy, France’s ambitious interior minister and a leading contender to succeed Chirac. He told the French media that Franco-German cooperation is outdated and that ‘the enlarged Europe cannot continue to be powered by a two-stroke engine alone’. Many analysts believe that if Sarkozy takes over from Chirac in 2007, France will move decisively into the Atlanticist camp.

Merkel has also sent an important signal that she considers NATO to be the anchor for the transatlantic dialogue on security issues. In a press conference with NATO Secretary General Jaap de Hoop Scheffer, Merkel said: ‘Indeed, the fact that we’ve come here within 24 hours after the government was formed and after I took office, is meant to be an expression of the fact that NATO is important for us. Not only as a military alliance, but also as a political alliance, important for the transatlantic security dialogue.’

A rebalanced Franco-German axis will have broad implications in other areas too, especially on China policy. Chirac was the main force behind the charge to lift the EU arms embargo on China, an effort which Schroeder energetically supported. But Merkel says she opposes lifting the ban until China improves its human rights record. She is also sympathetic to US concerns about the strategic balance in the Taiwan Straits. Thus it seems unlikely that the European Union will lift its arms embargo anytime soon. This will defuse another important source of transatlantic friction.

Can Merkel Deliver?
Merkel says she wants to re-emphasise the transatlantic relationship as the cornerstone of German foreign policy. And the Bush Administration will welcome a new German approach to France and Russia. But the fragile nature of the coalition government she formed with her biggest rivals, together with a German public that remains hostile to Bush, may limit what she can accomplish. So the big question in Washington is: what can Merkel really deliver?

Merkel’s government is unwieldy and untested, and its long-term political stability remains open to question. Merkel, the leader of the centre-right Christian Democrats (CDU), was sworn into office after weeks of contentious negotiations to form a governing coalition with the centre-left Social Democrats (SPD), the party led by Schroeder before he lost in September balloting. She says the arrangement is ‘no love affair’. In both the domestic and foreign policy arenas, Merkel’s room for manoeuvre as chancellor will be shaped by what the coalition can agree upon. That may not be much, given that many of the architects of Schroeder’s foreign policy have retained key positions in the Merkel government. German Foreign Minister Frank-Walter Steinmeier, for example, was Schroeder’s chief-of-staff and a key shaper of his international outlook.

Merkel’s desire for warmer relations with Washington will also be constrained by German public opinion. Most Germans remain deeply sceptical of the Bush Administration because of Iraq, Guantánamo and other issues. This antipathy has been enthusiastically fuelled by the German media, which never miss an opportunity to malign the United States. The depth of the adverse feeling in Germany about US foreign policy is evident in poll results from Transatlantic Trends, a project of the German Marshall Fund of the United States. Some 80% of Germans said they disapproved of the way Bush was handling international policies, and 60% said that it was undesirable for the United States to exert strong leadership in world affairs.

But the dominant topic in German politics is economic reform, and as such it is the issue that will determine the success or failure of Merkel’s government. In her first news conference as chancellor, Merkel said that ‘by European and global standards, Germany is in a state of decline. Our goal is to stop this downward trend.’ But Merkel was forced to abandon her boldest economic proposals as the price for building her coalition with the SPD. Instead, she unconvincingly proposed raising taxes as her plan to jump-start a stagnant economy and reduce record unemployment (Germany already has the highest nominal taxes in Europe). This implies that her government may not complete its full four-year term, a factor that will also weigh in on the amount of political capital that Merkel can spend on Bush.

What Bush Wants from Germany
Bush told Merkel that Germany is ‘the heart’ of Europe. But Americans are masters of the balance-of-power politics Germans call Realpolitik, the effective implementation of which lies in the ability to realistically adjust to changes in international balance. Therefore, even if rhetorically Merkel is more pro-American than her predecessor, Washington knows that Germany has only a limited economic capacity to play a wider global or military role.

Indeed, US-German relations will never be as close as the Anglo-American ‘special relationship’. Like the United States, Britain’s interests are global in scope. Although Germany is the centre of gravity in Europe, Berlin has little global projection of military power and limited geo-strategic influence beyond its borders. Germany is mostly a regional actor.

Moreover, unlike America’s relationship with Britain, Washington no longer shares interests with Berlin that can be called vital. During the Cold War, Germany and the United States were allies because their vital interests coincided almost seamlessly. Indeed, Germany was at the centre of world politics for most of the last century. But America’s primary security concerns now lie beyond Europe, and without the Soviet threat Germany has become less dependent on the United States. This has also enabled Germany to chart a course more independent of Washington.

These changes have contributed to the rise in German anti-Americanism. During most of the Cold War, German foreign policy was based on the idea of ‘resolute neutrality’, which freed it of foreign policy responsibilities and allowed it to recreate the German identity following the catastrophe of World War II. But with the end of the Cold War came new ideas about Germany’s role on the world stage. Given its position as the largest economy in Europe, Schroeder yearned for the United States to deal with Germany in Augenhoehe (an equal partner in leadership). This was showcased by his demand for an equal seat at table of the United Nations Security Council.

But Schroeder’s ambitions are at odds with reality. Germany is a middle-sized power in economic crisis and demographic decline. Berlin cannot spend more on defence, which in turn limits its ability to assume greater global responsibilities. Germany’s inability to exert influence proportionate to its economic size has prevented the articulation of a clearly defined post-Cold War foreign policy. This, coupled with an ever-worsening economy, has fuelled frustration and resentment. As a result, Germany is becoming increasingly pacifist, while at the same time its national sovereignty is gradually submerging within trans-national institutions like the European Union and the United Nations. Germany’s world-view is therefore moving away from that of the United States. Indeed, German ideological self-definition is being reconstructed as antithetical to the United States. As such, it reflexively disdains many elements of the American way of life, including its market-driven capitalism, its religiosity and the death penalty. To be German is, some would say, to be anti-American.

On a practical level, however, German and American interests still coincide. Both countries have a mutual interest in promoting democracy, the rule of law and free markets in their diplomacy. Moreover, the United States needs allies, and in this sense Germany matters very much. Even though the United States is not a member of the European Union, America is a European power. Washington thus has a vital interest in having good relations with the biggest country in Europe.

As a result, the White House will try to engage Berlin on an issue-by-issue basis. It will push Germany to strengthen its ties with American allies in Britain and Eastern Europe, and to weaken its ties with France and Russia. It will ask Germany for help in reforming NATO, and it will call on Merkel to push for trade liberalisation within the European Union. Moreover, the White House will encourage a stronger and more capitalist German economy that fosters entrepreneurship and innovation. With bilateral trade valued at more than US$150 billion, the United States has a huge vested interest in Germany’s economic well-being.

Finally, even if Merkel does not change Germany’s current foreign policy, her ascendancy is important simply because she is not Schroeder. At heart, Schroeder was a political opportunist who zealously sought to undermine Washington at every turn. By contrast, Merkel’s instinct is fundamentally pro-American, and she will change the style with which bilateral disagreements are handled. This will make a world of difference.

If Merkel’s coalition government survives, and she completes her four-year tenure as chancellor, then she will outlast Bush, who is set to leave the White House in January 2009. This offers a three-year period during which bilateral and transatlantic ties can be transformed. During this time, Germany and the United States will have a number of opportunities to celebrate bilateral success stories that may also be catalysts for discussions about how to move forward. 2007 will mark the sixtieth anniversary of the Marshall Plan. 2008 will mark the sixtieth anniversary of the Berlin Airlift. And in 2009 Germans will celebrate the sixtieth birthday of the Federal Republic, as well as the twentieth anniversary of the fall of the Berlin Wall.

All of these events were possible only because of 60 years of unwavering American commitment to Germany. What Washington wants most from Berlin is a reliable partner.

Conclusion: Bush and Merkel have laid the groundwork for rebuilding US-German relations, which will improve largely commensurate with how far she brings Germany back into the Atlanticist fold. But even if Merkel makes no substantive changes to German foreign policy, bilateral ties are still set to improve simply based on the positive change in style and rhetoric on both sides. This will permit Berlin to return to its traditional role as a mediator between Europe and the United States. The Atlantic Alliance will thus be favourably rebalanced.

Soeren Kern
Senior Analyst, the US and Transatlantic Dialogue, Elcano Royal Institute