German Finance Minister Wolfgang Schäuble had a plan to push
Greece out of the euro zone. Chancellor Merkel wasn’t sure what to do
about it. The result is widespread resentment of Germany and a damaged
Franco-German relationship. By SPIEGEL Staff
There are days when Wolfgang Schäuble’s staff would prefer to be
somewhere else. In Timbuktu perhaps, or up on the Acropolis. In any
case, far, far away.
Last Thursday, the German finance minister rolled into an elevator in
the Reichstag in Berlin. He was irritated, for he soon had to appear
before the Affairs of the European Union Committee to defend a bailout
plan for Greece that he didn’t even believe in. «Grottenfalsch,» as he
would say — «dreadfully wrong.»
In his wheelchair, Schäuble leaned to one side and rubbed his face.
«What about the appointment at 5:30 p.m.?» he wanted to know. «It’s in
the schedule,» a staffer responded, immediately wishing he was somewhere
else. «In the schedule?» When Schäuble gets irritated, he doesn’t raise
his voice. Instead he stretches out his vowels like a rubber band.
«Scheeeeeeedule,» he said, and then issued an order: «Call the
chancellor’s secretary and ask where it is.»
He then inhaled, flashing a pugnacious smile and turned his
wheelchair around. He then prepared for battle of a kind he had never
before fought in his long political career — a battle against the Greek
government, against American economists, against large swathes of
European public opinion and also, to some extent, against the chancellor
Had it been up to Schäuble, Germany would have shown the Greeks the
euro-zone door long ago. His problem, however, is that the chancellor
doesn’t share this sentiment. Merkel rejects his insistence because she
doesn’t want to go down in history as the government leader responsible
for the disintegration of Europe.
If it were any other minister that had so persistently refused to
endorse her line, she would likely have got rid of him long ago. But she
can’t do that with Schäuble. His hard line is precisely what makes him
so popular among the Germans.
Moreover, Schäuble enjoys a special place in Merkel’s cabinet. He has
been a member of German parliament, the Bundestag, since 1972; he
served under Helmut Kohl as interior minister and party leader; and he
negotiated the reunification treaty in 1990. Shortly thereafter, he was
shot and crippled by a mentally ill man. Schäuble isn’t simply a
politician, he’s a piece of German history, and therefore untouchable.
He even has the chutzpah to threaten Merkel with his resignation should
she force him to act against his convictions. «If anyone were to try, I
could go to the president and ask to be relieved of my duties,» he told SPIEGEL in an interview.
A Curious Mix of Indecision and Brutality
But that freedom is now becoming an issue for Merkel. The euro summit
last weekend came close to failing because Schäuble tried to push
through such tough demands. And this from a finance minister who has
done so much for European unity. Just three years ago, Schäuble won the
International Charlemagne Prize of Aachen for his contributions to the
integration of the Continent, but is now regarded in southern European
countries as the epitome of the ugly German. This too adds to the drama
of Wolfgang Schäuble.
In past decades, the burden has always fallen on Germany to be the
mediator in Europe. But only when Germany suppressed its own interests
was it possible to find harmony in the complicated meshwork that is
Europe, where the Catholic South meets the Protestant North and the
rule-fixated Germans and the anarchistic Greeks come together. No one
has internalized this rule more than Schäuble — or so it seems. Now
Germany’s policy on Europe is revealing itself as a curious mix of
indecision and brutality. That brutality, for the most part, comes from
It was undoubtedly the right move to impose strict reforms upon
Greece. This was the only way to persuade countries like Slovakia and
Latvia to release new funds. But last weekend’s marathon summit in
Brussels didn’t only bring forth a new aid package for Greece. A new
Germany was also presented, one with a rather uncomely face.
It was there that Schäuble raised the idea of pushing Greece out of
the euro. It was a suggestion that broke a European taboo. Germany, of
all countries, was showing another euro-zone member the door. Germany,
whose rise is so closely linked to the solidarity and forgiveness of its
The summit was therefore not merely a break in Germany’s Europe
policy. It also described the tragedy of Merkel and Schäuble, chained
together yet increasingly working against one another.
The calamity began last Thursday when top members of Merkel’s
coalition government met at the Chancellery. Merkel was there, as was
Schäuble, Social Democrat (SPD) leader Sigmar Gabriel and Foreign
Minister Frank-Walter Steinmeier, who is also from the SPD. The idea was
to prevent a rift with France, but the group also deliberated over how
to proceed with Greece if it refused to implement the reforms demanded
by its creditors.
Schäuble proposed a temporary Grexit, in such a situation. Merkel and
the SPD leaders agreed, but for them it was little more than a thought
experiment. Greece, they knew, would never willingly sign on to a
A Greek Time Out
The next evening, though, Schäuble’s state secretary, Thomas Steffen,
sent out a paper with the title, «Comments on the latest Greek
proposals,» to a number of colleagues, including Eurogroup chief Jeroen
Dijsselbloem. Under item No. 2, it said that if Athens does not comply
with creditors’ demands, the country could be encouraged to take a time
out from the euro zone for at least five years.
Schäuble and his people see their proposal as an offer to
cooperatively solve a Grexit — at least that’s the official line. But
Schäuble also signaled to the Greeks that he could rally a majority of
finance ministers to get behind a Grexit, even against Athens’ will.
When Schäuble landed in Brussels on Saturday morning, he noted that
his proposals were not incorporated into the ministers’ working paper.
It’s not clear who was responsible. It could have been Italy, for
example. Or France. Both countries staunchly oppose the expulsion of
Greece from the euro zone. Schäuble was beside himself.
Schäuble first consulted with other conservative finance ministers
belonging, as Schäuble’s CDU does, to the European People’s Party. Like
Schäuble, most were in favor of a Grexit and the men hatched a plan for
how they could force Greece from the common currency area. The ministers
agreed to formulate such strict conditions for a third aid package that
the Greek government would never be able to accept them. As a means to
push Greece out of the euro, Schäuble had devised a so-called trust
fund, into which all revenues from the sale of Greek assets would flow.
For Greek Prime Minister Alexis Tsipras,
that would have been impertinent enough. But the conservative ministers
wanted to go even further and demand that the fund be located in
Luxembourg, a stipulation Tsipras could not possibly accept.
When Schäuble arrived at the Eurogroup meeting later, he could at
least chalk up a partial victory. He was able to get the Grexit idea,
and the trust fund model, into the final document, but both of them were
in square brackets, meaning the finance ministers were not in
agreement. But still, European leaders received a draft text in which a
euro zone without Greece was officially mentioned.
As Schäuble’s proposal of a temporary Grexit became public over time,
outrage ensued. «To Germany I say, enough is enough,» Italian Prime
Minister Matteo Renzi said. Luxembourg’s foreign minister, Jean
Asselborn, and Austrian Chancellor Werner Faymann complained that
Schäuble obviously wanted to humiliate a European partner.
It quickly dawned on Merkel and her advisors just how explosive
Schäuble’s idea was. Suddenly she was seen all over Europe as a
chancellor who wants to throw Greece out of the euro.
A Round of Four
As the summit began on Sunday at 4:15 p.m., the mood was depressed.
European Council President Donald Tusk opened proceedings by asking
whether everyone was in agreement about wanting to prevent a Grexit. The
leaders answered in the affirmative, Merkel included.
Yet the finance minister’s paper still remained the working basis for
the negotiations and Merkel rejected Tusk’s suggestion of formulating a
shorter one. The chancellor wanted to keep Greece inside the euro and,
at the same time, meet Schäuble’s demands — an almost impossible feat.
Merkel’s indecision tainted the summit from the get-go. Tusk quickly
realized the futility of debating in the full round.
Instead, he convened a round of four that would negotiate three times
that night. It would include Tusk, Tsipras, Merkel and French President
François Hollande. They retreated to the «Salon du Président» on the
European Council building’s eighth floor. Tsipras requested to bring his
new finance minister, Euclid Tsakalotos. Merkel countered by saying
that if Tsakalotos came, Schäuble would have to come too. For a moment,
Tusk and Tsipras were speechless. Only then did they grasp the humor in
Tsakalotos was allowed in while Schäuble stayed outside. The
negotiations took 17 hours, lasting until 9 a.m. Monday morning. Around
4:15 a.m., as all of the leaders were again convening, it looked for the
first time like an agreement might be possible and optimism quickly
spread. Tsipras said he had to make a few phone calls to Athens, needing
to speak to the Greek president and a few party leaders. When he
returned, he said he could grudgingly accept all of the terms except
Schäuble’s privatization fund. «Absolutely unacceptable,» he called it.
Tusk interrupted the meeting for the third time and upped the
pressure. Finally, Merkel agreed to let Greece use part of the proceeds
from the sale of Greek state assets for investments. But a dispute arose
when it came to determining just how much. Tsipras wanted 50 percent,
Merkel only 10. Hollande, Tusk and Dutch Prime Minister Mark Rutte
suggested 25 percent, or €12.5 billion ($13.6 billion). Tsipras and
Merkel both refused. Merkel suggested adjourning and calling another
summit for Wednesday. It was a moment at which the risk of a Grexit
again seemed dangerously close. Schäuble would have reached his goal.
Tusk, however, categorically rejected an adjournment. He said if
everyone left before reaching an agreement, he would announce that the
negotiations had failed. An €86 billion rescue package had already been
approved. It was inconceivable to think that a few billion euros more
could cause the deal to collapse. Around 6 a.m., Eurogroup head
Dijsselbloem called SPD chief Gabriel, asking for help. Gabriel, in
turn, called Merkel and Hollande. Later, Djisselbloem would tell the SPD
parliamentary group that «suddenly things worked that once seemed
impossible.» In the end, Merkel and Tsipras agreed. The summit was
Difficult for Tsipras
A Greek crisis, however, was not yet averted. The Brussels paper had
effectively made Greece a ward of the euro zone. The government in
Athens would have to cut pensions and raise taxes. National sovereignty
would essentially be a fantasy. Asked during the press conference that
followed the 17-hour negotiations which parts of the deal bore Tsipras’
handwriting, Merkel answered: «It’s there, namely in the high funding
Schäuble, for his part, would continue to insist that Greece leave
the euro. A clear commitment to Athens, at least, was not discernable.
Ultimately, it’s Schäuble who has to hammer out the details of the next
bailout package, and as things currently stand, he’ll use every
opportunity to make life more difficult for Tsipras.
From Schäuble’s point of view, his insistence on a Grexit isn’t
anti-European, but rather a service to the greater community. He
believes that Greece does not fulfill the prerequisites for being a
responsible member of the euro zone. To him, it’s a country that doesn’t
even have a functional tax system, but one which named Yanis Varoufakis
to the position of finance minister, a man to took it upon himself to
lecture all of Europe about economics.
Of course Schäuble knows he can’t get around Merkel. If she’s made up
her mind, there will be no Grexit. On the other hand, the mood among
German conservatives is clearly on Schäuble’s side. The fact is, in
terms of European policy, he’s got more credibility than Merkel, who has
never been able to shake the impression of lacking the appropriate
amount of enthusiasm for Europe.
That’s what makes it so difficult for the chancellor at the moment.
She lacks the means to discipline Schäuble. She is fully aware of just
how much negative attention her finance minister is attracting
throughout Europe. French President Hollande recently complained to
confidants that Merkel has always waffled when it came to Greece but
also that she has never distanced herself from Schäuble and his Grexit
plans — not even in private.
Imposing Her Will
The euro crisis is driving a wedge between Berlin and Paris. Hollande
is doing everything he can to prevent a Grexit, even if it means going
behind Germany’s back. Just two weeks ago, after the Greek referendum,
Hollande and Merkel were in agreement that Athens must make its own
Merkel’s people were thus surprised to learn that Hollande had
provided the Greek premier with advisers to help him come up with a list
of reforms. The plan to send French officials to Athens had been in the
works for six weeks. On July 2, the social democratic leaders of
France, Sweden and Austria, as well as Gabriel and the president of the
European Parliament, Martin Schulz, met in Evry, near Paris, to
deliberate over a solution for Greece. French Prime Minister Manuel
Valls suggested sending French finance officials to Athens to help the
government there formulate its request for emergency funds. Faymann,
Gabriel and Schulz all agreed.
Now, after the summit, Merkel sees herself in a role she never
wanted. She’s the woman who imposed her will on Europe. «The French
president has fought hard for a solution,» Austrian Chancellor Faymann
said, while handing out no such praise to Merkel.
Germany’s relationship with power has been precarious ever since the
end of World War II. That has to do with its central location in Europe
and its reluctance to use military force. Most of all, though, it has to
do with its Nazi past. Any bravado or harsh words are immediately
conflated with a resurgence of German megalomania.
The response to this problem by German policymakers has been the use
of «soft power.» Germany has led the Continent not with orders, but with
persuasion and cooperation. Every chancellor has relied on the
relationship with France in matters of European policy. This alliance
prevents a split between the northern European Protestants and the
But now, a fault line is threatening to emerge. In early 2013, the
Italian philosopher Giorgio Agamben wrote an essay for the newspaper La Repubblica
in which he implored the «Latin empire at the heart of Europe» to
resist Germany’s dominance. At the time, it seemed like the idea of an
overexcited essayist, but now it’s clear that the southern countries are
increasingly opposing the Continent’s germanization.
Merkel’s people can sense this mood change. A few months ago,
Nikolaus Meyer-Landrut mused in a small group about Germany’s changing
role within the European Union. Meyer-Landrut was Merkel’s European
policy adviser for four years but soon he’ll become the German
ambassador to France.
Germany’s Changing Position
Meyer-Landrut knows he has a reputation for being a tough negotiator.
But it wasn’t until the euro crisis that complaints about him from
abroad began to pile up. It was said that the chancellor’s adviser had
presented his demands in a rude tone. He also apparently did not listen
nor was he accomodating to other people’s sensitivities. Meyer-Landrut,
for his part, said he did not think that he had changed. It was more a
question of Germany’s position changing.
In the past, he said, Germany had always been the moderator. If
Britain and France disagreed on, say, agriculture policy, it was up to
the Germans to help them reach a compromise. Today, with matters
concerning the euro, Germany finds itself in a different position. It
must now enforce a policy regarded by its partners as extreme. This
unavoidably changes perceptions of the country.
France, especially, has become much more critical. Pascal Lamy, a
former EU commissioner for trade, recently said Europe was a constant
struggle between discipline and solidarity. «The Germans,» he said,
«were exuding little solidarity and much discipline.» It sounded like a
Merkel pushed through her ideas with the logic of practical
constraint rather than with the force of a brilliant speech. This
method, however, clearly reached its limitations at the euro summit, in
part, due to her indecision. France and Italy wanted to keep Greece in
the euro no matter what, while Schäuble wanted a Grexit.
The compromise was that Merkel kept Greece in, but imposed conditions
that could at least partly be described as penal. The euro crisis left
Merkel with immense power; she now essentially shapes domestic Greek
policy. But such power also calls for at least a smidgen of generosity,
something she proved unwilling or unable to provide in the case of
At the post-summit press conference, it was with delight that she
rattled off every condition Greece would have to fulfill, no matter how
small. Really, the only thing that was missing was a declaration that
she would provisionally take over the post of Greek prime minister,
Can Europe be led this way? Schäuble’s stance in the euro crisis
doesn’t have to seem congenial, but at least it’s based on a clear
analysis of the situation. That analysis goes something like this:
Greece is unable to handle the responsibilities that come with being a
member of a common currency union. As a consequence, it must leave the
euro. Merkel is like a teacher who disciplines unwilling students by
smacking them across their fingers with a ruler. At most, this heightens
their frustration, not their willingness to learn.
By Fiona Ehlers, Julia Amalia Heyer, Horand Knaup, Peter Müller, Ralf Neukirch, René Pfister, Christoph Schult and Timo Steppat
Spiegel, Παρασκευή, 17 Ιουλίου 2015 ( A Government Divided: Schäuble’s Push for Grexit Puts Merkel on Defensive)