Um zu verstehen, wie tief die SPD in die Europapolitik der Merkel-Regierung verwickelt ist, muss man also zunächst auf die Ära Schröder zurückblicken. Als dieser im Jahr 1998 an die Macht kam, versprach er, die Arbeitslosigkeit zu reduzieren, die gerade auf mehr als vier Millionen gestiegen war. Die Ursache dieses Anstiegs: Deutschlands verarbeitende Industrie war immer stärker dem globalen Wettbewerb ausgesetzt und litt vor allem unter der Konkurrenz aus den Schwellenländern. In seiner ersten Amtsperiode schaffte es Gerhard Schröder nicht, die deutsche Wirtschaft zu reformieren. Aber die Reformen der Agenda 2010 in seiner zweiten Amtsperiode führten – zusammen mit anderen Faktoren – zu einer Verwandlung der deutschen Wirtschaft.To understand his argument about the development of the SPD's current position, it's helpful to remembers some major dates:
Parallel dazu, aber eher als Folge der erstaunlichen Lohnzurückhaltung, welche die Tarifpartner im ersten Jahrzehnt des neuen Jahrhunderts vereinbarten, fielen die Lohnstückkosten in Deutschland im Vergleich zu anderen europäischen Ländern dramatisch. Zur gleichen Zeit produzierte die Einführung der gemeinsamen Währung einen Kreditboom in anderen Ländern des Euroraums, von der deutsche Firmen massiv profitierten. Auch war die Schwäche des Euro im Vergleich zur D-Mark für deutsche Exporteure ein Vorteil – plötzlich waren sie außerhalb Europas viel wettbewerbsfähiger. Nach 2005 begann die Arbeitslosigkeit zu fallen und Deutschlands Leistungsbilanz entwickelte sich von einem Defizit in Höhe von 1,7 Prozent des Bruttoinlandsproduktes (BIP) im Jahr 2000 zu einem Überschuss von 7,4 Prozent im Jahr 2007.
- 1998-2005: Red-Green Coalition government, headed by Chancellor Gerhard Schröder and Vice Chancellor/Foreign Minister Joschka Fischer
- 2005-2009: First Grand Coalition (GroKo) of the CDU and Social Democrats headed by Angela Merkel (CDU)
- 2008: recession begins in Europe setting off a period of economic depression for which there is currently no end in sight
- 2009-2013: Kleine Koalition of the CDU and Free Democrats (FDP) headed by Angela Merkel (CDU)
- 2009: The Greek debt crisis comes to light when the new social-democratic PASOK (ΠΑΣΟΚ) government of Giorgos Papandreou (Γιώργος Παπανδρέου) revealed that the previous government of the conservative New Democracy party had concealed the level of the country's debt
- 2009-present: The combination of the economic crisis, the Greek debt crisis, speculative attacks on the bonds of other eurozone countries, bailouts for banks and the austerity policies insisted upon by the Troika (IMF, EU Commission, ECB) conforming with the dogmatic demands of Merkel's "ordoliberalism" produced a situation of high debt in several "periphery" countries coupled with depression-level economic conditions with no immediate prospect of emerging from them that has now reached the point of lowflation/deflation, which creates even greater hurdles to a recovery.
- 2012: Approval of the Treaty on Stability, Coordination and Governance in the Economic and Monetary Union, which is referred to in short as the Fiscal Compact or the Stability Compact. Or by me as the Fiscal Suicide Compact, because it writes into the national constitutions of the eurozone countries arbitrary and highly restrictive deficit and debt limits, effectively outlawing the use of normal macroeconomic ("Keynesian") fiscal policy to combat recessions and depressions.
- 2013-?: Second GroKo of the CDU and Social Democrats headed by Angela Merkel with both parties firmly committed to continuing the austerity policies against the periphery eurozone countries.
Kundnani argues:
Um zu verstehen, wie tief die SPD in die Europapolitik der Merkel-Regierung verwickelt ist, muss man also zunächst auf die Ära Schröder zurückblicken. Als dieser im Jahr 1998 an die Macht kam, versprach er, die Arbeitslosigkeit zu reduzieren, die gerade auf mehr als vier Millionen gestiegen war. Die Ursache dieses Anstiegs: Deutschlands verarbeitende Industrie war immer stärker dem globalen Wettbewerb ausgesetzt und litt vor allem unter der Konkurrenz aus den Schwellenländern. In seiner ersten Amtsperiode schaffte es Gerhard Schröder nicht, die deutsche Wirtschaft zu reformieren. Aber die Reformen der Agenda 2010 in seiner zweiten Amtsperiode führten – zusammen mit anderen Faktoren – zu einer Verwandlung der deutschen Wirtschaft.Agenda 2010 was a neoliberal program very much in the spirit of what we in America call "bipartisanship," resulting in far less job security and many more low-paying jobs.
[In order to understand how deeply the SPD is mixed up in the European policy of the Merkel government, one must first look back to the Schröder era. When he came to power in the year 1998, he promised to reduce unemployment, which had just climbed to more than four million. The origin of this increase: Germany's manufacturing industry was more and more shut out of world competition and suffered above all from the copetition of the developing countries. In his first term in office, Gerhard Schröder did not manage to reform Germany's economy. But the reforms of Agenda 2010 in his second term led - together with other factors - to a transformation of the German economy.]
Kundnani continues, explaining that the combination of the adoption of the euro currency, the Agenda 2010 reforms and a general willingness on the part of German unions to accept wage increases that lagged significantly behind productivity increases:
Parallel dazu, aber eher als Folge der erstaunlichen Lohnzurückhaltung, welche die Tarifpartner im ersten Jahrzehnt des neuen Jahrhunderts vereinbarten, fielen die Lohnstückkosten in Deutschland im Vergleich zu anderen europäischen Ländern dramatisch. Zur gleichen Zeit produzierte die Einführung der gemeinsamen Währung einen Kreditboom in anderen Ländern des Euroraums, von der deutsche Firmen massiv profitierten. Auch war die Schwäche des Euro im Vergleich zur D-Mark für deutsche Exporteure ein Vorteil – plötzlich waren sie außerhalb Europas viel wettbewerbsfähiger. Nach 2005 begann die Arbeitslosigkeit zu fallen und Deutschlands Leistungsbilanz entwickelte sich von einem Defizit in Höhe von 1,7 Prozent des Bruttoinlandsproduktes (BIP) im Jahr 2000 zu einem Überschuss von 7,4 Prozent im Jahr 2007.This is a good description of how Germany benefits from the euro currency, a matter that neither the CDU or the SPD nor the mainstream German press are much inclined to explain on any kind of regular basis.
[Parallel to that, but rather more the result of the astonishing wage restraint on which the tariff partners {labor and management} agreed in the first decade of the new century, the unit labor costs in Germany fell dramatically in comparison to other European countries. At the same time, the introduction of the common currency {the euro} produced a credit boom in other countries from which German firms profited massively. Also, the weakness of the euro in comparison to the Deutschmark was an advantage for German exporters - suddenly they were much more competitive outside Europe. After 2005, unemployment began to fall and Germany's trade deficit at the level of 1.7% of the gross domestic product (GDP) in the year 2000 developed into a surplus of 7.4% in the year 2007.]
As Kundnani points out, the SPD was anxious to take some credit for their own party for the improvements that were occurring. And since they had embraced the same basic neoliberal approach as the CDU takes, they couldn't really criticize its downsides without inviting reflection on their own role in creating them. Not that the SPD's leaders were especially interested in criticizing the CDU. After all, they agreed to become the junior partner in her first government, and now in her third one.
And then there's just plain old nationalism: "In Bezug auf die Eurokrise teilt die Partei nämlich weitgehend Merkels Grundannahmen, darunter besonders die Vorstellung, die deutsche Wirtschaft sei für andere Länder ein Vorbild." ("In realtion to the euro crisis, as a matter of fact the Party [SPD] shares Merkel's basic assumptions to a large degree, especially including the concept that the German economy is a model for other countries.")
But in the currency union, that's an exceptionally short-sighted a self-destructive way to approach it.
For the SPD, Kundnani argues that developing a constructive alternative to Merkel's austerity policies would involve some real self-criticism of their approach in the 2000s. It would require a rejection of the neoliberal, let-the-market-run-wild assumptions that they hold now.
In the 2013 German election, the SPD offered up some suggestive but vague programs to try to strike a profile distinct from Merkel's and the CDU's, talking about special measures to combat youth unemployment and vaguely acknowledging that Germany's current trade surplus made not be all good. But as soon as the election was over, they couldn't wait to become the junior partner in another Merkel-led, pro-austerity GroKo. The SPD couldn't be bothered to make even a head-fake toward holding out in the coalition negotiations to try for an SPD-led majority left government with the Greens and the Left Party, which numerically was a possibility. If we count the SPD as left, which most people still do, the German election last year produced a left/left-center majority in the Bundestag.
Kundnani characterizes the CDU and the SPD over the last year as following the same destructive policies toward the eurozone, but with the CDU coming off as wanting to compel the other countries to be like Germany, while the SPD wants to help them become like the superior Germans. Either way, the destructive nationalism and the Herbert Hoover/Heinrich Brüning economic policies are the same in all essential respects.
He also notes that the SPD has criticized Merkel for not doing more along the same lines as their neoliberal reforms. Good grief!
Yanis Varoufakis renders a similarly harsh judgment on the SPD and European Social Democracy more generally when he writes (Europe’s Crisis and the Rise of the Ultra-Right is the Left's Fault 06/09/2014):
Rather than constantly clashing with industrialists and merchants in order to extract from them a share of their profits, social democratic parties of government believed that a Faustian bargain with financiers could: (a) yield more funds for social programs, (b) end their conflict-ridden relationship with industry, and (c) allow them to hobnob with the rich and powerful, as partners, while still lavishly funding public hospitals, schools, unemployment benefits, the arts etc. It seemed like a dream come true for suited men who did not want to abandon the working class to its own devises but who had had enough of ... class struggle. [OMG! Did he say class struggle?]The Spanish Socialist activist Beatriz Talegón posted on her Facebook page today complaining about the old guard in the Spanish PSOE, specifically about their indifference or tacit support of the monarchy, "Por favor, Señores, dejen paso, con todo respeto. Treinta años pisando alfombras les han hecho olvidar de dónde vienen ustedes..." ("Please, gentlemen, with all respect: just go away. Thirty years walking on the carpet have made you forget where you came from ...") Having read her book No nos avergoncéis (2013), I feel safe in saying she would apply the same sentiment to their neoliberal economic policies, which seem to be as deeply accepted by the PSOE leadership as by the SPD's.
Faustian bargains come, alas, with clauses written in blood. Europe’s social democrats, lured by the cacophony of money-making in the financial sector, numbed by the myth of some 'Great Moderation', and excited by the mystical notion of 'riskless risk', agreed to let finance free to do as it pleased in exchange for funds with which to prop up welfare states that were relics of a bygone post-war social contract. That was the social democrats' game. At the time, it seemed to them a better idea, more fathomable, than having to be constantly in conflict with industrialists, seeking to tax them to redistribute. In contrast, they found a cosy relationship with bankers more amenable and easy going. As long as the 'leftist' politicians let them do as they pleased, the financiers were happy to let them have some crumbs off their gargantuan dinner table.
Ironically, as Kundnani also describes well, what is critically needed for the eurozone as a whole is for Germany to follow a stimulative policy that would increase the wages of Germans and thereby generate a higher internal aggregate demand, both within Germany and in the eurozone as a whole. German workers could start receiving a higher share of the gains in productivity over the last decade, of which on the average they have received little so far.
But such a policy would have redistributive effects that the German One Percent would find undesirable. So without political parties articulating a serious left criticism and explaining the real alternatives and fighting the One Percent politically over them, the eurozone course to disaster will continue.
Did Varoufakis say "class struggle"? The problem right now in the eurozone is that the One Percent have been very successfully carrying on a class struggle that is destructive to everyone else as has put the "European project" on the road to ruin without effective enough democratic resistance.
Tags: angela merkel, austerity economics, eu, euro, european union, spd
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