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September 27, 2021

France’s New Laissez-faire Approach to Germany

Paris has learned to advance its EU agenda with whatever government emerges in Berlin.

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There are not many reactions from France’s classe politique to the German elections.

The usually talkative Jean-Luc Mélenchon decided to stay mute considering that Die Linke, the party on which he modelled his own far-left break-away party, France Insoumise, only just scraped into the Bundestag. With his own party doing poorly in the latest polls, Mélenchon is struggling for relevance.

Anne Hidalgo, the Socialist Paris mayor, travelled to Olaf Scholz’ last campaign rally in Cologne to bask in some of the winner’s glow. She takes courage from the fact that seven months from the French presidential elections, her candidacy seems equally as risible as Scholz’ was in February this year. Moreover, the Greens can no longer point across the Rhine and then argue that in France their time has also come. Hidalgo’s biggest competitor for a unified center-left candidacy has been robbed of one of their main arguments.

From President Emmanuel Macron, there has been no official reaction either. It will be months before Germany’s next chancellor lands in Le Bourget to pay Macron his first visit. The center-right Les Républicains and Marine Le Pen’s far-right Rassemblement National are equally quiet. The Christian Democrats recorded a historic defeat and like Le Pen, the AfD is failing to grow beyond its regional strongholds and is wrong-footed in a post-pandemic world. Campaigns uniquely focused on EU bashing and anti-immigration feel stale and lazy all of a sudden.

If it is only Hidalgo who may try to profit from the German elections by praising Scholz’ remontada, there is another reason why the vote has sparked few reactions: Paris can live with any government that is formed over the coming weeks.

Something for Everyone

To start with, both a Scholzian “traffic light” and a Laschetian “Jamaica” coalition have something to offer.

Scholz would mean a nearly 25-percent increase in the German minimum wage—a long held Paris demand. The wage increase would shift Germany’s economic model further away from the “race to the bottom” wage competition and strengthen German domestic demand, which is key to rebalancing Europe’s economy. To satisfy the Greens’ climate plans the pro-business Free Democrats (FDP) will accept using the flexibility the debt brake offers, allowing Germany to pivot from balanced budgets to small fiscal deficits. The drawbacks: With an FDP Finance Minister Christian Lindner, Macron’s eurozone integration plans would suffer, while the SPD and Greens will not be enthusiastic about defense spending.

Laschet would certainly be a boost to Macron’s goal to advance EU defense capabilities. As they did during their time in government with SPD Chancellor Gerhard Schröder (1998-2005) and the Jamaica coalition negotiations of 2017, the Greens are likely to focus on their climate change priorities and concede on the rest. Counter-intuitively, a Laschet government could also turn out to be fiscally laxer than Scholz. The CDU and FDP would need to give the Greens carte blanche on climate policy and the money that needs to go along with it to get them interested in Jamaica. Printing that debt is much easier to swallow for a Finance Minister Lindner if the CDU is not in opposition. The drawbacks for Macron would be no minimum wage rise and few advances on eurozone integration.

No More Wasted Crisis

If both coalitions are interesting in Macron’s eyes, Chancellor Angela Merkel’s departure also has some upsides. Scholz as well as Laschet are instinctively more pro-European than the incumbent ever was, French politicos point out. The pandemic is a case in point.

Firstly, when financial markets panicked over the pandemic, Merkel at first rebuffed Macron’s assessment that an EU economic response to the crisis was needed. Scholz instead pushed steadily for a pandemic-related fiscal capacity that now serves as a template for future EU fiscal integration.

Secondly, when COVID-19 hit, Merkel closed national borders against Macron’s advice. It also was quite unnecessary—at the time the French were not allowed to move further than one kilometer from their homes. In contrast, Laschet kept the borders of his state North Rhine- Westphalia open, stressing that the pandemic was no reason to put Europe in paralysis.

Instincts matter, particularly when it comes to EU politics. In times of crisis, power gets centralized at the top and existing political narratives can be reframed. “Europe will be forged in crisis,” Jean Monnet, the cognac trader turned founding father of the EU, once said. With Scholz and Laschet, the hope in Paris is that one does not have to wait for another 15 years and until “there is no alternative” in order to leverage a crisis to advance Europe.

From Franco-German Motor to Broker

If there is a worry, it does not primarily concern the likely speed of the coalition negotiations. The talks will take months and put negotiations in Brussels on big EU files in trade, industrial, and climate policy on hold. They may also overshadow France’s EU presidency in the first half of 2022. But the real window of opportunity for new EU initiatives is the year between the France’s presidential and the Italian general elections to be held at the latest in June 2023.

More important from a French point of view is that the three-way negotiations are successful in giving the Federal Republic a stable coalition with an authoritative chancellor.

In Paris, one remembers too well the long period of 2017-18, when a politically weakened Merkel squabbled with the CSU and the conservatives in her own party over “upper limits” for refugee numbers, unable to force through the Franco-German Meseberg declaration. Back then, the likes of Dutch Prime Minister Mark Rutte and Austrian Chancellor Sebastian Kurz played well on these inner-German divisions to influence Berlin’s EU policy. Prepare for the FDP’s Lindner to get the red-carpet treatment when he flies to The Hague or Vienna.

An Alternative Strategy

Then again, Macron has found a work-around to the German 2017-18 problem. If Berlin is unable to play its part in the Franco-German motor and generate momentum, Paris has learned to advance its Brussels agenda with an alternative strategy.

The pandemic recovery fund, the rule of law mechanism in the EU budget, the increase in the climate reduction goals to 55 percent by 2030 have all one thing in common: They have been advanced by a Paris-engineered, but not French-led coalition of (often smaller) EU member states that cut across the North-South and East-West axis. Berlin was not a member of these coalitions, but when it realized that the train had already left the station, it tried to regain control of the situation and took on its role of mediator-in-chief to broker an EU-wide deal.

Sure, Franco-German deals are still crucial to the EU’s functioning. But in a different way.  Historically, they stood at the beginning of EU integration initiatives. Berlin and Paris hatched a plan behind closed doors and then tried to sell it to the EU’s remaining members. Today, Paris doesn’t wait for Berlin to advance its own initiatives. The famous Franco-German compromise now often only stands at the end of a much more EU-wide negotiation process.

So, don’t expect a French initiative to do a new Meseberg with the incoming German government. That approach is history. The EU motor now runs on much more than two cylinders. It makes the EU more agile, less dependent on its big members including Germany. And this is “auch gut so.”

Joseph de Weck is INTERNATIONALE POLITIK QUARTERLY’s Paris columnist and author of Emmanuel Macron. The revolutionary president.

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