Friday, July 05, 2019

An Ursula von der Leyen presidency would be a huge victory for Angela Merkel

Published on The Spectator's Coffee House Blog

German defence minister Ursula von der Leyen has been put forward by European leaders as the candidate to succeed Jean-Claude Juncker as the President of the EU Commission, a powerful position. If she is approved by the EU Parliament (which is not yet certain) it would be a victory for German Chancellor Angela Merkel, and a bad thing for Europe.
Von der Leyen attended the European School in Brussels, just like Boris Johnson. Like Boris, she’s the child of a European Commission official, but that’s where her similarities with the potential prime minister end. She wants a ‘United States of Europe’, a political union for the Eurozone and a ‘European army’, even if her own track record as defence minister ‘is regarded as a failure among friends and foes alike’. Rupert Scholz, who was defence minister under former German Chancellor Helmut Kohl thinks that the German army’s ‘condition is catastrophic’, something he calls ‘totally irresponsible’.
Are we then witnessing something similar to an episode of the Danish political drama Borgen, where an elder politician is promoted to Brussels against their will? Not really. German Chancellor Merkel values the European Commission job highly. In August 2018, the German daily Handelsblatt reported that Merkel was no longer aiming to secure the ‘top job’ of president of the European Central Bank (ECB) for a German, and would instead push for Germany to obtain the EU Commission Presidency. Already, von der Leyen’s name was being floated.
Interestingly, it was not Merkel but French President Macron who first came up on Monday with von der Leyen’s name, when socialist Dutchman Frans Timmermans was opposed by the Eurosceptic governments of Italy and Central and Eastern Europe. This very much looks like a traditional EU negotiation: France and Germany dividing the two top jobs amongst each other, by first putting a candidate forward to be ‘burned’.
Ursula von der Leyen received public support from the four Central European ‘Visegrad’ countries, who were on a ‘anyone but Timmermans’ mission, as he had been plaguing their governments with EU challenges against their judicial reforms. Von der Leyen had also played a constructive role in posting German troops in Eastern Europe, which undoubtedly created some goodwill. Hungarian PM Viktor Orbán claimed victory on Wednesday, saying Timmermans had been replaced with a German mother of seven, which ‘…in itself shows that change is afoot in Europe.’
Macron’s motives to go for this deal are easy to read. As a former banker, he knows the importance of the ECB Presidency, so he secured this for the French head of the IMF, Christine Lagarde. It’s not the first time his love for banking has come to the fore: in 2017, Macron negotiated the move of the European Banking Authority from London to Paris.
Macron was also victorious in killing off the Spitzenkandidaten system, whereby EU leaders would be supposed to endorse someone picked as the lead candidate by one of the political groups in the European Parliament. In a way, this system had already failed because MEPs themselves couldn’t gather around a candidate to propose to EU leaders. Fundamentally, Spitzenkandidaten was a failed attempt to claim it would be ‘democratic’ to bypass European national democracies.
For Merkel, this process has been about making sure that the EU Commission Presidency goes to an EU federalist. She was willing to sacrifice Germany’s prospects with the ECB for this aim, even if it meant that for the third consecutive time someone from the ‘Latin’ part of the Eurozone will be in charge of the bank. The President of the ECB has a lot of power. Only last month, Mario Draghi, who occupies the position now, hinted at new stimulus measures without even discussing it with the ECB’s Governing Council, which drove down the value of the Euro. The Euro fell again with the announcement this week that Draghi would be succeeded by yet another ‘dovish’ Eurozone money-printer – European savers have already been hit by Lagarde before she even enters office.
Merkel was obviously not going to sacrifice the powerful ECB just to promote an inconvenient politician away. Just like von der Leyen, Angela Merkel is an EU federalist. Some may take issue with describing Merkel this way, as she has never come out in favour of things like a ‘European army’, but in her actions she has always struggled for more transfers of power to the European level. That’s been the case since she came to power, when she announced that her government would work to revive the EU Constitution that had been rejected in referendums in France and the Netherlands the previous year. The EU Constitution, which removed national vetoes and gave more power to the European Parliament and bureaucracy, was recycled as the Lisbon Treaty.
After that, Merkel was pivotal in allowing the creation of emergency bailout funds, such as the ‘European Stability Mechanism’, an embryonic Eurozone Treasury in all but name, handing out transfers veiled as emergency loans, with conditions attached that increased centralised control over national economic policy. In 2015, she further overruled her Chancellor, Wolfgang Schäuble, who had threatened to exclude Greece from the Eurozone. During the migration crisis, Merkel worked hard to push through mandatory quotas for member states to accept asylum seekers, outsourcing a sensitive decision to the supranational EU level. This has further undermined support for the EU in Central and Eastern Europe, where governments such as Viktor Orbán’s in Hungary have used the quotas to hurt the EU’s legitimacy. Last but not least, in 2014, Merkel did not assist the UK in preventing the appointment of the EU-federalist Jean-Claude Juncker. Later, she also didn’t help David Cameron secure EU reforms when she swiftly ruled out EU Treaty change.
In sum, Angela Merkel is an avid EU federalist and she very much wants a soulmate leading the European Commission, to secure her legacy for the next five years. In practice, von der Leyen may of course plot her own course, but given that most people in ‘Eurocratia’ favour business as usual the longer they stick around, no one should get their hopes up. In any case, picking someone in favour of even more concentration of power at the EU level is the wrong choice. To regain trust, the EU should instead focus on its core business: scrapping barriers to trade.