Can Germany Lead Europe Strategically?

The coronavirus pandemic has catapulted an unprepared Germany into a new, partly digital world and has submitted Europe to a stress test of its unity. While this is presently challenged, too, by external crises including in Lebanon, Belarus, and the Eastern Mediterranean, the pandemic is a major challenge for the EU, described by French President Emanuel Macron as Europe’s moment of truth.Can Europe overcome fissures among the EU member states, including divisions over the COVID-19 crisis? Can it find unity in managing its deficits in crisis management, expertise, and competence?

COVID-19 is changing economies, healthcare, the media, and international relations. Earlier pandemicsand the end of the Cold War, the 9/11 terrorist attacks, and the 2008 financial crisis reordered society. This crisis is testing trust in government and social cohesion. It has highlighted social inequalities and lead to an economic recession, but may renew hope for fighting global climate change at the same time. Will it also result in “a global landscape of increased great-power rivalry, nuclear proliferation, weak states, surging refugee flows, and growing nationalism, along with a reduced US role in the world,” as Richard Haass argued in Foreign Affairs? Globally, a disunited or disoriented Europe would become an irrelevant actor bouncing between China, the United States, and Russia.

The EU’s Transatlantic Fate

As the EU debates a more self-reliant role in the transatlantic partnership, it has to become aware of and use its soft and hard power capabilities—economic strength, data protection, regulatory rules, and a significant role in development policy. Europe can step up to more responsibility in cybersecurity and information security to protect democratic processes and hybrid threats. It is this burden-shifting—not the 2 percent of GDP for defense called burden-sharing—that will define the “new normal.” The strength of the transatlantic alliance will depend more on working together on joint investment programs in research and development, such as in digitalization and European security policy. A united European Union with political cohesion on democratic and liberal values, as well as social cohesion, can fill the transatlantic leadership vacuum. The EU bears a historical fate of determining the future of the transatlantic relationship that is the foundation of security and prosperity in Europe.

The failure of the US government to control the pandemic has isolated Washington, while President Donald Trump’s withdrawal from international leadership has created a power vacuum that Russia and China seek to fill. Hope for a return to the status quo ante is misplaced. It will not return. Relations between Europe and America are eroding. Rather than pining for the elusive return of a transatlantic partnership, both the US and Europe must now invest in a rebalanced relationship.

The Democratic presidential candidate, Joe Biden, outlines his ideas in his article, “Why America Must Lead Again.” He sets out the enormous task facing America to get tough with China. Biden cites Chinese technology and intellectual property theft, and subsidies that give its state-owned enterprises an unfair advantage. He suggests the “most effective way to meet that challenge is to build a united front of US allies and partners to confront China’s abusive behaviors and human rights violations, even as we seek to cooperate with Beijing on issues where our interests converge, such as climate change, nonproliferation, and global health security.”

Critical Issues

When it comes to Germany and the transatlantic partnership, there are two critical issues that confront it. They are China’s systemic rivalry and growing economic power, and Europe’s internal unity combined with less dependence on the United States. Europe has alternatives; it can stand by the transatlantic partnership, partner with China, or practice equidistance between the two. As the German-American relationship erodes under President Trump, the traditional reliance on the United States is being called into question. Partnering with an autocratic, systemic rival like China is out of the question. Does then an equidistance strategy position the EU to balance between the two given growing European economic dependence on China, and the uncertainty of sustaining European unity?

The EU is demonstrating that democracy and open markets can manage the pandemic’s impact on the economy equally if not better than most authoritarian states, even if China can shut down entire cities with its centralized power structures. The alliance with America is more resilient than skeptics suggest. In these times of uncertainty, it is understandable that Europe is seeking to ease its dependence on the US while sustaining the values of democracy, freedom, the rule of law, and respect for human dignity. That need not end the transatlantic alliance.

American policymakers, too, will have to decide if they prefer a more self-reliant Europe, even if it aligned with American interests, and remained dependent on the US security guarantee in NATO. US policymakers may find Europe a forceful and more autonomous partner that will sometimes go against their favored policies. In the long run, a European continent that can defend its interests and fight its own battles will benefit Washington more than a divided and weak one. Ben Haddad, in his article “Europe Alone. What comes After the Transatlantic Alliance” also argues that Europe has a choice to make. It cannot claim the mantle of independent global leadership while continuing to rely on the United States for its security, including in its immediate neighborhood.

All Eyes on Merkel

The COVID-19 crisis should not be allowed go to waste. In this global power shift, the world is watching whether Germany, during its council presidency of the European Union, has the political will to take legislative initiatives and protect the unity of Europe. One of Germany’s tasks is to strengthen the European single market and keep Europe globally competitive. The revived Macron-Merkel cooperation since the coronavirus crisis began has enabled them to lead together, to overcome resistance, and offer compromises. Chancellor Merkel, as chair of the EU’s rotating council presidency, and Ursula von der Leyen as president of the European Commission—if they can muster the political will—must solidify European unity that sustains the continent’s stability.

Merkel and Josep Borrell, the EU foreign policy chief, may provide the strategic foresight needed to look beyond crisis management and set the future course of Europe. Germany must essentially explore its role in Europe with Russia, the post-Soviet space, the West Balkans, China, in the Middle East and North Africa. Germany’s reactive crisis management is no longer sufficient for a more robust European pillar of the transatlantic partnership. European policymakers’ goal is to reverse the trend toward European irrelevance and disunity.

The EU has come together to borrow the €750 billion it needs to finance the recovery. The agreement doubles the EU budget for the next three years, empowers the EU Commission to borrow on the capital markets, and modifies EU governance to determine the rules for issuing loans and grants, which is a significant step toward politically empowering the Commission.Theimpressive Next Generation EU financial support program of a €390 billion will contribute to EU economic solidarity. The agreement does not adequately address revenue sources to service the EU debt, except to consider levies on plastics, digital services, or carbon taxes. Nevertheless, steps toward granting the EU the power to tax have advanced in the discussion.

More European Autonomy

There are further steps the EU should consider as it moves slowly toward the European Economic and Monetary Union. The long path to building the eurozone on the way to possible political unity harkens back to the March 1990 East German parliamentary elections, which gave East Germany a mandate for unification and cleared the way for the implementation of an earlier Franco-German EMU deal. Already in then-EU Commission President Jacques Delors’1989 report on the establishment of the Economic and Monetary Union (EMU), he insisted that “monetary union without a sufficient degree of convergence of economic policies is unlikely to be durable and could be damaging to the Community.”

Ivan Krastev has argued that the coronavirus has shown that the EU cannot continue in its current structure. The pandemic has at least initially shown the EU’s irrelevance in solving the public-health crisis—a policy area not foreseen as belonging to its field of competencies. At the same time, Krastev notes the risk that the EU may become more centralized, assuming more powers. It has to balance the centralizing drives with its federalist structure and the responsibilities of the member states. Whatever the outcome of this balancing might be—it is a constant feature of all federal arrangements—a more robust European Union will be the future of the transatlantic relationship after COVID-19.

The problem Germany faces in its 2020 revolving EU presidency is how this most prosperous and secure country can take the political initiative, and make the necessary economic sacrifices to complete the work of European unity without dominating it. During the financial crisis, George Sorosremarked that “Germany is likely to do what is necessary to preserve the euro—but nothing more.” Now is the time to come forward strategically.

James D. Bindenagel is Senior Professor at Bonn University. His new book “Germany: From Peace to Power” (Bonn University Press/Vandenhoeck & Ruprecht) is out now.