A new era of German economic nationalism?

Made in Germany: Quality guaranteed. Photo: fotolia.com (guukaa)
Lukuaika: 3 min. 

The German political elite and mass media take considerable pride in the quality of German products. In recent years, the term ‘Exportnation’ has featured prominently in public discourses. It also testifies to a new era in the national identification with the German economy.

Germany in the global trade race

In March 2010, when the Greek crisis was unfolding and Germany’s export model was increasingly criticised, the German Minister for Economics and Technology at the time, Rainer Brüderle, launched a ‘foreign trade offensive’ (Außenwirtschaftsoffensive). When presenting this government initiative, he said that “Germany’s export strength […] is a success that we can be proud of”.

Christine Lagarde, then French Minister of Economic Affairs, and others began to voice more openly that they see Germany’s trade surplus as one cause of the crisis. Accordingly, they argued that, in order to solve this crisis, it is necessary that Germany makes some adjustment too.

In response to this criticism, Brüderle said: “If you practice more effectively and run faster, nobody shall put lead weights in your shoes.”

According to this rationale, Germany is competing in a global race and having the world’s largest current-account surplus is an economic virtue and a sign of success. The problematic implications, such as the lack of domestic demand, wage stagnation and the imbalance of saving over investment, tend to be disregarded.

From Exportweltmeister to Exportnation

During the course of the crisis, Chancellor Angela Merkel reaffirmed on several occasions that “Germany must remain an export nation”.

In January 2010, she said: “Germany can secure its prosperity only if it will continue to be a strong export nation. All statements that we do not need to export as much are in my view wrong. Rather, we need to develop our strengths […] further and make them more sustainable, but we must never give them up. That is our philosophy.”

This national identification with a particular economic model is very striking but not an entirely new phenomenon in German history.

Already in 1969, Herbert Giersch, one of the most influential German economists at the time, expressed concern that Germany’s “old political-military nationalism revives as export nationalism”. “Our export offensive, which is subsidised by undervaluing the Deutsche Mark, threatens to become some kind of substitute nationalism,” Giersch said.

In 1990, in the light of reunification, Jürgen Habermas published an article about “D-mark nationalism”. One of the main arguments he put forward was that after the protest movements in the 1960s the only element of post-war West German self-conception that remained undisputed was the self-esteem as an economic power; and the Deutsche Mark had become the symbol of national pride.

Following up on Habermas’ account, Hans Kundnani suggests in his recently published book The Paradox of German Power that in recent years “Germany’s economic nationalism appeared to re-emerge in another form”, in which “Germany’s world-beating exports […] had seemed to replace the Deutsche Mark as the symbol of German economic success” (p. 86).

If we agree that Germany’s economy-driven nationalism has entered a new era, should we be surprised that, as Joschka Fischer, former German Foreign Minister (1998–2005), wrote, “from now on Germany will primarily pursue its national interests, just like everybody else”?

The end of ‘post-national mentality’?

Jürgen Habermas claims that the dramatic summit on July 12–13 this year, when the German Minister of Finance, Wolfgang Schäuble, suddenly suggested a ‘voluntary, temporary’ exit of Greece from the eurozone, might have marked the end of German “post-national mentality”.

He believes that the current German government has “gambled away in one night all the political capital that a better Germany has accumulated in half a century”, as it “made for the first time a manifest claim for German hegemony in Europe”.

Commentaries by Habermas and many others, particularly on the political left and prominent Anglo-American economists, suggest that there is now a widespread perception that Germany, whether intentionally or not, has broken with its post-World War II European policy.

We can understand this shift better if we look at it as an episode of Germany’s economic nationalism looking outwards, manifesting itself in a moral authority and the tone the German government displayed by asking the crisis-afflicted countries to ‘do their homework’.

Exporting the ‘German model’

What the German government means by ‘doing their homework’ is to implement policy measures that resemble the German Sparpolitik (austerity policy) and the so-called Agenda 2010, which is generally regarded as the key to Germany’s economic success over the last decade.

In 2009, Germany has constitutionalised a ‘debt brake’ (Schuldenbremse), which obliges the federal government to limit its structural deficit to 0.35 percent of GDP from next year onwards. The Agenda 2010 is a set of labour market and social security reforms, which were implemented from 2003 onwards, when Germany was written off as the “sick man of Europe”.

The question that evidently troubles many international observers at the moment is: Is Germany going to succeed in turning the ‘German model’ into its latest export hit?

I thank Cai Weaver for his support in editing this text.

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