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Chancellor Merkel Reigns Supreme In Germany And In Europe

Angela Merkel

Angela Merkel has been Chancellor of Germany since 2005. In September of 2017, she will run for her fourth term. Despite a number of unpopular political decisions in the past few years, she has made herself an indispensable leader for her party and Germany. Her steadfast perspectives on some of the most significant issues facing her country and Europe, have only added to her almost unassailable political position.

Mrs. Merkel became the political head of the Christian Democratic Union (CSU) in 1998. Over the years, she has skillfully moved the party closer to the center, which has enabled her to maintain power. She has successfully co-opted many center and leftist issues, which have been popular with the electorate.

Her position on renewable energy, is a case in point. She is moving to close the last nuclear power plants in Germany and has firmly endorsed, the national push for alternative sources of power. Under her time in office, the Germans have become world leaders in solar and wind power. The country gets more energy from alternative sources of power at more than 30%, than in any other major nation in the world.

The Merkel era is casting a long shadow over the affairs of the European Union. It has become nearly impossible for any new policy to brought forward, without the approval or at least acquiescence of the German chancellor.

Global Map of the European Union

Her power is based on two fundamental explanations. One is her obvious longevity. She has been in power, far longer than any other Western leader. The second is the increasing economic and financial power of Germany.

The fiscal conservatism of Germany over the past decade and more, has paid enormous dividends for German influence in the Euro-zone. It has allowed Merkel far greater flexibility, when using money as part of her negotiating tactic.

The steady build up in foreign exchange reserves which remain near $200 billion USD (United States dollar) on an annual basis, has been made possible through running endless trade surpluses. These are at 8.9% of GDP (Gross Domestic Product). The European Commission’s  recommended upper limit is 6%.

The German current account surplus, hit another record high in 2016, at close to $288 billion USD. The country has overtaken China again, allowing Germany to hold the world record for another year.

As of 2013, Germany is the 3rd largest exporter and 3rd largest importer in the world, producing the largest trade surplus as a national economy.

These growing excesses has brought increasing consternation from trading partners and the IMF (International Monetary Fund). Germany is coming under accelerated pressure to elevate domestic demand and imports, to even out Euro-zone and global trade imbalances.

Chancellor Merkel has deflected some of the criticism more recently, by introducing a national minimum wage in 2015. Last year, there was a corresponding hike in pension entitlements. These actions in her opinion, provide sufficient steps in boosting overall domestic demand.

Mrs. Merkel also brought forward increased spending for roads, digital infrastructure and of course, additional costs associated with migrants.

However she did refuse to compromise on one particular issue. This concerned total government spending. Unlike the other major countries of Europe, Mrs. Merkel has balanced the federal budget, which gives her far more flexibility in dealing with financial issues.

Part of the political success of Merkel, has been the steadfast patience she has exhibited during major crises. This is a quality Germans value in their leaders. The predictable calm demeanor of the Chancellor, has been often appreciated by political leaders throughout Europe.

The growing influence of Chancellor Merkel on the world stage continues to grow. It is quite telling that she was the last foreign leader that the United States President Barack Obama called, before leaving office in January of 2017.

Merkel and Vladimir Putin, President of Russia, holding a joint press conference, March 08, 2008

On the opposite end, is the perspective from the President of Russia. Vladimir Putin considers Merkel to be a dangerous person. She alone in Europe, had the posture to push back against his annexation of Crimea and intervention in eastern Ukraine. Changing political borders in Europe by force, Merkel recognizes, is something that must be opposed most vigorously.

The Russian President and the world was able to catch a glimpse of Merkel’s character back in 2007.

At Putin’s summer residence, the Russian leader knowing that Merkel was afraid of large dogs, allowed into their meeting room a full grown black Labrador. She remained incredibly calm and even forced a smile. She maintained this demeanor as the dog moved about the room and finally rested at her feet.

At the time, she did not lash out at Putin. Instead, she used her wit to say to the German press later, that only insecure types resort to such tactics. She added further, this was how one can discover their vulnerabilities.

U.S. Secretary of State John Kerry speaks with British Foreign Secretary William Hague and Ukrainian Foreign Minister Andrii Deshchytsia after hosting the Budapest Memorandum Ministerial on the Ukraine crisis in Paris, France, on March 5, 2014.

The failure of Putin to recognize her strength, led to his miscalculation beginning with Crimea. His previous foreign adventure in the Caucasus, ended with a full scale Russian assault and the defeat of the small country of Georgia. It was here in 2008, that Merkel was able to see what Russia under the control of Putin, was capable of doing.

When the Russian leader took his next expansionist move in the Ukraine, she was determined to resist. The pretext for the invasion was the ouster of then pro-Russian President Viktor Yanukovych, after months of protests and demonstrations.

Russia had been one of the signatories of the Budapest Memorandum in 1994. The deal had guaranteed the borders and sovereignty of Ukraine. In exchange, Ukraine would surrender their cache of atomic weapons and sign the Nuclear Non-Proliferation Treaty.

The take over of Crimea and the annexation of the territory in March of 2014 by Russia, would galvanize Merkel into action. As European leaders were still reeling from these developments, Russian backed separatists in eastern Ukraine began seizing towns and cities.

Ukrainian forces then went on the offensive and were on the verge of regaining these eastern territories by August. Then Russian reinforcements from across the border entered the fray. They halted the forces of Ukraine and then began to push them further back. A cease fire known as Minsk 1 failed to hold and by January 2015, it looked like a full scale war was inevitable.

Leaders of Belarus, Russia, Germany, France, and Ukraine at Minsk II summit, 2015.

That Russia would ignore their previous treaty obligations, made Merkel all the more determined to hold them to account.

Fearing an all out war between Russia and Ukraine, Chancellor Merkel stepped in with President Francois Hollande from France. Together they arranged for what has become known as Minsk II. Although the terms of the agreement have stalled, it has prevented a much wider war. The overrun of the country by Russian forces was averted. An independent Ukraine survives.

It is not the best outcome, but the best that could be arranged for given the strength of Russian arms in the region. Full implementation of the deal remains unlikely. Ukraine and their allies to the West want a real ceasefire to the fighting, before there are any political compromises.

In January 2016, Ukraine joins the Deep and Comprehensive Free Trade Area (green) with the EU (blue), established by Ukraine–European Union Association Agreement

The Russians for their part, continue to accuse the Ukrainians of not providing the political reforms. The government of Ukraine knows to give into Russian demands, will in reality allow Putin veto power over their internal affairs. Furthermore, it will hinder any additional moves by Ukraine, towards greater economic and political integration with the European Union.

Merkel pushed firmly for sanctions against Russia for their aggressive moves. These consist of diplomatic measures, asset freezes, and visa bans. There are further prohibitions concerning banking, energy, defense and general technology transfers. All together, the provisions have made a negative impact on the overall Russian economy.

The German Chancellor is insisting that the sanctions remain in place, as long as Russia remains illegally in possession of Crimea and continues to interfere in the rest of Ukraine.

Chancellor Merkel can also be critical of policies taken by allies. Although she has not personally responded to criticism of her refugee policy, Merkel did finally go public when she considered a vital right of exiles was at risk. She even took the step to remind the new American President Donald Trump, of the international right of refugees to political asylum, as part of the Geneva Conventions.

Knowing that the United States government under President Trump, will criticize that Germany has not fulfilled the commitment to NATO (North Atlantic Treaty Organization) in spending 2% of GDP on the military, she has already indicated Germany will be spending more on defense.

She is not known for bluster and bragging about accomplishments. Merkel possesses a number of important foreign and security matter successes. They were achieved through compromise and difficult negotiations. The Euro-crisis, the sovereign debt crisis and the deal with Turkey on refugees, are prime examples.

Migrants in Budapest railway station, with most heading to Germany, September 4, 2015

The later 2016 agreement with Turkey, cut down substantially, the number of migrants coming to Europe and Germany in particular. Although the refugee deal remains at risk, due to rising tensions between Turkey and Europe, it has provided the latter more time to try to deal with this vexing issue.

The latest complaint by Turkish officials is that both Greece and Germany are harboring fugitives. These would be individuals that Turkey claims, were involved in the coup attempt last July. Chancellor Merkel has already arrived, to meet with Turkish President Erdogan to discuss the matter.

The original agreement called for Turkey to block the flow of refugees across its border into Europe, in exchange for cash assistance. The easing of visa requirements for Turkish citizens traveling to the European Union, was also part of the deal.

A further discussion to restart the application of Turkey in joining the European Union was mentioned as well, but Erdogan must know that there is little real chance of that happening, in the present political climate.

The new ECB headquarters in Frankfurt,Germany which opened in 2014.

The European sovereign debt crisis began near the end of 2009. Some of the contributing causes in addition to the profligate spending of many individual countries, was the Financial Crisis of 2007 and 2008, and the Great Recession of 2008 to 2012. These events were intertwined by a real estate market crisis, with its origins coming from a largely unregulated property bubble.

Europe in economic and financial turmoil, saw a number of nations unable to repay or refinance their government debt. The worst instances of this problem was in the countries of Greece, Cyprus, Iceland, Ireland, Portugal and Spain. With the exception of Iceland they were all members of the Euro-zone.

The aforementioned member states, were also experiencing problems keeping their banks solvent. It became necessary for the European Central Bank (ECB),the IMF, and the European Financial Stability Facility (EFSF). The latter was set up specifically in 2010, to help alleviate the debt crisis.

100,000 people protest against the austerity measures in front of parliament building in Athens, Greece May 29, 2011

In 2009, Greece finally revealed the previous government had totally misrepresented the national budget deficit. These higher than expected debt levels scoured investor confidence. This resulted in bond spreads rising to completely unsustainable rates. Bankruptcy loomed for a number of European countries using the Euro.

The strategic role played by Chancellor Merkel throughout these crises, cannot be fully appreciated by the casual observer. Although she was more than willing for Germany and the financial institutions of Europe to provide assistance, Merkel was unbending that these nations move forward with economic reforms.

Although these countries were willing to take the aid offered, they often resented the austerity measures that came with it. To her credit to those who see the danger in endless accumulations of debt, she insists that nations in the Euro-zone, maintain their annual budget deficits to 3% of GDP or lower.

Her insistence on austerity has so far worked. Although the policy is in opposition to many economists, international institutions and many foreign leaders she remains unmoving. Merkel continues to believe that countries in Europe, must learn to live within their means.

By opening Germany’s borders to refugees fleeing Middle East, some critics have blamed Merkel for encouraging the mass migration into Europe.

Chancellor Merkel has enjoyed relatively high public approval throughout her three terms in office. Her only major blunder was not realizing the chaos that would ensue, following her decision to openly accept the massive number of refugees coming from the Middle East and North Africa.

A record 1.3 million refugees arrived in 2015, which was double from the year before. The pace would only slow in 2016, after the migrant agreement with Turkey.

The fateful decision that the Chancellor made, impacted all of Europe not just Germany. Her own country would accept over 1 million refugees in 2015 alone. This was 5 times more than had arrived in 2014.

In September of 2016, Chancellor Merkel would finally apologize to the German people for her handling of the refugee crisis. She still does not believe the decision was wrong, only that her government could have been better prepared for the sheer numbers of migrants. In her opinion, it was both the moral and legal thing to do.

Merkel with President Petro Poroshenko from Ukraine and Joe Biden Vice-President from the United States, February 7, 2015

As the numbers of migrants have slowed considerably and the German government regains control of the situation, her national polls have revived somewhat. Yet, for the first time in years, her political future is no longer assured. Her political opponents continue to remind voters of the unfortunate consequences, her ill advised policy has brought upon the nation.

Her conservative CDU party remains the largest political party, but still cannot form a government on its own. In a recent poll, the Socialist (SPD) candidate Martin Schulz is ahead of Mrs. Merkel by 16%. However, Germans do not elect the Chancellor directly, but rather the party they represent.

Merkel acknowledges the greatness of Konrad Adenauer, in the founding of modern Germany following the end of the Second World War. He would remain Chancellor for 13 years. The greatness of Helmut Kohl in contributing to the end of the Cold War and the reunification of Germany has been identified by her, as one of the crowning achievements of her former mentor.

Former Chancellor Helmut Kohl in 1990

If Merkel wins the next general election later this year and serves out her fourth term, her time in office will equal that of Helmut Kohl, with an improbable 16 years. Some have speculated this next term will allow Mrs. Merkel to cement her legacy and permit her the time to fully deal with the refugee crisis.

The shrewdness of Chancellor Merkel, is to recognize when to push and when to compromise. Her ability to keep her emotions in check, provide her a distinct advantage in troublesome negotiations. The steely determination, has allowed her to persevere through many difficult times. She will need these sound political instincts in the difficult year ahead.

In the meantime, Chancellor Merkel remains a strong symbol of order and stability for Germany. Her power and influence throughout Europe is unmatched.

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