The myth of mighty Merkel

Dr Oliver Hartwich
Business Spectator
28 August, 2012

Have you ever heard of Alexander Dobrindt? He must be a member of Superheroes Anonymous because the provincial politician has just taken on the "most powerful woman in the world”, Angela Merkel. At least that’s what Forbes Magazine has once again named the German chancellor.

But wait, maybe Dobrindt is just a mortal Bavarian … and Angela Merkel not nearly as dominant as Forbes believes.

Over the past few weeks, Dobrindt has been attacking measures to save the euro, called ECB president Mario Draghi a counterfeiter, and predicted that Greece would soon leave the euro as indeed it should – all in open defiance of Chancellor Merkel. And though Dobrindt sounds like an opposition politician, he is in fact the secretary general of the Christian Social Union, Merkel’s Bavarian sister party and coalition partner.

In a way, such open schisms between allied parties and friendly fire from rural MPs are nothing unusual. Think of Herr Dobrindt as Germany’s Barnaby Joyce, and you get the picture. But it actually demonstrates quite nicely that the allegedly super-powerful Merkel is about as powerful as an empty battery. If she can't even unite her own coalition government, why should Greeks, Spaniards or central bankers take her seriously?

Merkel’s powerlessness is not entirely her fault. The last powerful German chancellor committed suicide in 1945 and left Europe in ruins. Ever since, Germany’s political system has been designed to prevent the rise of another Hitler-type figure – for perfectly understandable reasons.

And so the office of Germany’s federal chancellor has been embedded into a complicated system of checks and balances. Federalism, bicameralism, proportional representation, a constitutional court, an independent central bank: All of these political institutions have been designed to limit the power of the government and the person who purportedly leads it.

Note that the Basic Law, Germany’s constitution, only assigns the chancellor the right to "determine and be responsible for the general guidelines of policy” (Article 65). Government ministers, however, are solely responsible for their departments and the chancellor is meant to resolve differences of opinion between ministers. Splendid – the task of the most powerful woman in the world is to mediate between her independent, squabbling cabinet colleagues.

Compare this to the power wielded by an incumbent US president, a British prime minister or even Julia Gillard and it is obvious that among them the German chancellor, whether her name is Merkel or not, will always be the least powerful figure. She cannot appoint judges, she is not the commander-in-chief of the armed forces in peace time, and she cannot veto laws. As far as heads of government go, German chancellors look somewhat deficient from, say, a British or an American perspective.

But the limitations of her office are not the only reason for Merkel’s powerlessness. She may not command much power, but even if she did she would not know what to do with it. That is because Merkel lacks both an understanding of the euro crisis and a clear strategy of how to resolve it.

Remember that at the beginning of the crisis, early in 2010, she first refused any assistance to Greece. Months later, she agreed to the first Greek rescue package. She ruled out Eurobonds "for as long as I live”, but she introduces European debt-pooling through the backdoor of the European Stability Mechanism. She insists on price stability as the sole goal of monetary policy but gives her backing to Mario Draghi’s announcement to defend the euro at all cost.

Some of her critics allege that in doing all of this Merkel was following a cunning plan to undermine democracy, lead Germany into a European superstate or subjugate other European countries under Berlin’s dictate. Nonsense.

While all of that may indeed be the consequences of Merkel’s actions and inactions, it is not her intention. All she is doing is trying to stay in power but in actual fact her ability to lead, let alone rule in the euro crisis is limited. Constrained by constitutional weakness, stalled by a lack of convictions and hindered by an absence of economic understanding, she is not quite sailing straight through the crisis. Floating like driftwood would be a better metaphor.

Little wonder, then, that even political dwarves like Dobrindt now manage to embarrass Merkel by making her authority deficit visible to the public.

And not only Dobrindt. The president of the Bundesbank, Jens Weidmann, has just given Spiegel magazine a long interview explaining why Germany’s central bank vehemently opposes future ECB bond purchases.

 When asked for comment on Weidmann’s thinly veiled attacks against Mario Draghi, Merkel had no other choice but to back him and assert the independence of the Bundesbank. Just as a few weeks ago she had no choice but to back Draghi and the independence of the ECB. What Merkel really believes and wants remains her well-guarded secret.

Whatever possessed Forbes Magazine to put Merkel on the No.1 spot of the most powerful women in the world remains a mystery. A place somewhere between Shakira (#40) and Angelina Jolie (#66) would have been more appropriate. One has to fear that Forbes’ female ranking is really only determined by appearance.

Source: The myth of mighty Merkel

Stay in the loop: Subscribe to updates