The Post-Heroic Legacy of Angela Merkel

German Chancellor and Chairwoman of the German Christian Democrats (CDU) Angela Merkel waves as she departs after speaking at a CDU election rally the day before federal elections on September 21, 2013 in Berlin, Germany.
Sean Gallup/Getty Images

Angela Merkel wasn’t planning to run for a fourth term as German chancellor. What changed her mind was the shock of Donald Trump winning the White House in 2016.

Eight days after that election, outgoing U.S. President Barack Obama came to Berlin to say goodbye. Over dinner at the swank Hotel Adlon, it appears, he pleaded with Merkel to run again so that somebody — she — could hold together the West and the world. Four days after that, Merkel announced her candidacy.

To hold things together. If Merkel leaves a legacy when she retires this fall after 16 years in office, that must be it. No other leader has worked so tirelessly just to keep domestic, European and world politics from unraveling. But is that enough?

Think-tank types have called Merkel the preserver of the “liberal international order.” Some journalists have chosen catchier titles, including “defender of the free world.” Merkel, this narrative goes, saved multilateralism and international cooperation from a global onslaught of nationalism and jingoism.

Tellingly, Merkel herself never endorsed this label. The only time she implicitly nodded to it was during a commencement address she gave abroad in 2019 at Harvard University. Addressing an audience composed largely of America’s progressive elites — her base, as it were — she never mentioned Trump by name. But she urged graduates to “tear down walls of ignorance and narrow-mindedness” and to “take joint action in the interests of the multilateral, global world.”

Back at home, Germans were puzzled. They rarely hear their chancellor orate so simply and emotively. The Merkel they know is the former quantum chemist explaining the math behind the R-factor of viral transmission; the “Mutti,” or mom, reminding them to wear masks; or the policy wonk in chief expatiating on the minutiae of some tome of legislation. In German, she often sounds as if her intention is to be soporific.

Much of the time, it is. Merkel is a quintessentially “post-heroic” leader in a nation that itself has been described that way, after the traumas of causing and losing two world wars. Other leaders may yearn to soar to oratorical heights. Merkel aims to sedate Germans and make them forget whatever they were arguing about.

This trait points to a dichotomy between perceptions of Merkel inside and outside of Germany. Anglo-American journalists in particular have described the chancellor as a mastermind with prodigious powers to effect her iron will — in Brussels, at the G-7 or G-20, during cabinet meetings, wherever.

In this photo provided by the German Government Press Office (BPA), German Chancellor Angela Merkel deliberates with U.S. president Donald Trump on the sidelines of the official agenda on the second day of the G7 summit on June 9, 2018 in Charlevoix, Canada. Also pictured are (L-R) Larry Kudlow, director of the US National Economic Council, Theresa May, U.K. prime minister, Emmanuel Macron, French president, Angela Merkel, Yasutoshi Nishimura, Japanese deputy chief cabinet secretary, Shinzo Abe, Japan prime minister, Kazuyuki Yamazaki, Japanese senior deputy minister for foreign affairs, John Bolton, U.S. national security adviser, and Donald Trump.
Defender of the free world.
Jesco Denzel/Bundesregierung via Getty Images

Her compatriots, by contrast, have generally seen her — here comes a very German phrase — “leading from the center.” Merkel rarely divulges what she thinks before she has to, and sometimes not even then. A veteran of German politics who, like Merkel, is a former East German told me that this behavior is common among people who grew up in the communist dictatorship and never knew which opinion might later get them in trouble.

But there’s another explanation for why Merkel has often led from the center — or from the back, if you prefer: On most issues, she doesn’t have strong opinions. A major criticism from inside her own Christian Democratic Union has been that she’s not really even conservative, and is content to preside over her party’s creeping “social democratization.”

That characteristic made Merkel ideal for the governing arrangements she’s been in. For three of her four terms, or 12 of her 16 years in the chancellery, she’s found herself willy-nilly in coalitions with the center-left Social Democrats. The American equivalent would be an administration shared by Republicans and Democrats: unimaginable. But to somebody whose raison d’etre is holding things together, the challenge is intriguing.

For the most part, the result has been lowest-common-denominator policies so tedious they go unnoted abroad. But if you govern for 16 years, even uninspired policymaking inevitably builds up. And if what you’re governing is the European Union’s largest economy, that has ramifications.

A critique of Merkel’s legacy must therefore start with the things she’s omitted — reforms — and the stuff she couldn’t be bothered with — above all, a vision.

The No-Vision Thing

Germany’s last genuine economic reform happened not under Merkel but under her predecessor, Gerhard Schroeder. At a time when the German economy was called the “sick man of Europe,” he liberalized the labor market, which increased employment but also spawned a big low-wage sector. Separately, Germany’s employers and unions agreed to keep down wages for years to come, especially in export sectors.

This reformed economy is what Merkel inherited in 2005. On the plus side, it led to a long boom in employment that some economists have called a “second economic miracle” (the first occurred in the immediate post-war years).

Germany’s Unemployment Rate

Merkel inherited a boom, and Schroeder’s reforms deserve the credit

Note: Data are seasonally adjusted.

Source: Eurostat via Bloomberg

On the minus side, the same wage restraint not only made German industry more competitive but also distorted the euro area and even the global economy. If Germany had kept the Deutschemark, its currency would have appreciated. But as part of the currency union, the German economy in effect devalued relative to all others. As a result, the country’s current-account surpluses became the world’s largest for several years in a row. Everyone from Brussels to Washington was livid.

Current Account Balance

Under Merkel, Germany saved much more than it invested

Note: Data are not seasonally adjusted.

Source: German Federal Statistical Office via Bloomberg

Other explanations account for these surpluses, starting with demographics. As large age cohorts approach retirement, they’ve been saving even more obsessively than Germans tend to do. Whenever savings exceed investment in a country, the difference is the current-account surplus.

The right policy would therefore have been to increase public investment, in the hope of boosting private investment as well. But Merkel didn’t, at least until the pandemic. Instead, her party and much of Germany’s mainstream fetishized balanced budgets, even enshrining them into the constitution.

Federal Budget Deficits and Surpluses

In the Merkel era, Germany obsessed about balanced budgets

Source: Eurostat via Bloomberg

As so often, whether Merkel believed in this fiscal austerity or merely went along with the fad to keep the domestic peace is unclear. But such policies cost Germany a lot of goodwill among its European partners and other allies.

That go-along, get-along pattern has marked the Merkel era. For example, the Social Democrats in her coalition, coming from a long tradition of Russophilia, were keen on a second pipeline carrying gas directly from Russia to Germany under the Baltic Sea. Germany’s partners — including, notably, the U.S., France, Poland, Ukraine and Estonia — oppose the project, called Nord Stream 2, fearing that it will leave Germany more dependent on Russian energy, and eastern Europe vulnerable to geopolitical blackmail. But Merkel defends the nearly finished pipeline to this day.

Even when she appears to act boldly, it’s rarely clear whether the idea was hers or just bubbled up. German society has long been hostile to nuclear energy, and the Schroeder government decided to phase it out. Merkel’s conservative bloc used to be more accommodating to the industry, so her administration initially extended the life of these power plants. Then, 10 years ago, the reactors melted down in Fukushima, Japan. Within a few days, Merkel’s cabinet reversed course again, and agreed to another phase-out, to be completed next year.

Was Merkel so horrified by the disaster at Fukushima that she had a Damascene conversion? Or had she been waiting all along for an opportunity to remove a divisive controversy from German politics by swimming with the mainstream? Berlin’s wonks still debate her motivation. What’s clear is that Germany’s ballyhooed “energy transition” — the country wants to be carbon-neutral by 2045 — is much harder than necessary because nuclear reactors are going offline faster than coal-fired plants.

The list of problems left unaddressed goes on. Little has improved in Germany’s convoluted tax or welfare systems. To the chagrin of NATO allies, Germany’s army remains woefully anemic, and Germans can’t agree on whether or when they should even use it — a debate Merkel has skillfully ducked. The country also slept through the digital revolution: In reporting daily Covid infections, Germany’s health agencies have mostly been using fax machines.

Broadband Download Speeds

Germany lags far behind in connectivity, ranking 35th of the top 50 places

Note: Data for April.

Source: Speedtest Global Index

If you judge the outgoing German chancellor by her vision or her reforms, she must count as a failure.

The Anti-Heroine

But that standard assumes a classic and heroic narrative of leadership — of New Deals and Great Societies and such. Post-heroic Germans prefer subtler measures. How do leaders respond to crises? Do they prevent the worst? Do they hold society together?

When it comes to managing upheavals, Merkel’s record is hard to beat, at least quantitatively. Starting in her first term, the crises started piling up. The financial one washed up from the U.S. in 2008. A year later it inundated the euro area, almost forcing Greece to exit the currency union and causing bitter rifts between the EU’s north and south. Vladimir Putin, Russia’s president, went rogue in 2014, invading Ukraine. A year later, more than a million refugees walked from the Middle East through the Balkans to Germany. And now there’s Covid-19.

Migrants walk behind a police car during their way from the Austrian-German border to a first registration hall of the German federal police in the small Bavarian village Wegscheid, southern Germany, on October 20, 2015.
September 10, 2015, an asylum seeker taking a selfie picture with German Chancellor Angela Merkel following Merkel's visit at a branch of the Federal Office for Migration and Refugees and a first registration centre for asylum-seekers in Berlin.
They fled war, and the chancellor took them in.
Christof Stache/AFP via Getty Images; Bernd Von Jutrczenka/DPA/AFP via Getty Images (selfie)

In several of these very different crises, Merkel played an outsized role that amounted to holding together different people, groups or countries. This integrating role wasn’t always readily apparent. During the euro crisis, for example, both southern Europeans and conservative Germans demonized Merkel as the embodiment of all the policies they hated.

The Mediterraneans caricatured Merkel as a Teutonic taskmaster preaching unforgiving austerity to people in desperate need. German conservatives decried her for breaking European rules to pour German tax euros into bottomless Mediterranean pits.

If you squint at the overall situation today, you’ll notice two characteristic aspects of Merkelism. First, the euro crisis was never actually solved, and it may recur. Neither fiscal nor banking union is complete, largely owing to German vetoes. This failure redounds negatively to her legacy: Merkel often manages rather than fixes situations.

But second, the situation never unraveled. No country has exited the currency union, and Greece, Spain and other crisis-hit countries have reconciled with Merkel and the north. Moreover, mainstream German politicians today accept the bailouts that did happen. They’ve even countenanced Merkel’s support for the first joint EU bond issue later this year — a previously taboo initiative that some people see as the germ of a fiscal union.

At a European and domestic level, therefore, Merkel has held things together. What she intuited throughout was how much pain or indignity each of the many interest groups could bear, and how to find new equilibria for compromises. In an alternative scenario without Merkel, the euro area might have fallen apart by now.

She’s performed similarly in the West’s ongoing confrontation with Putin. In talks at Minsk and elsewhere, Merkel — often with French and Ukrainian presidents in tow — has prevented even worse Russian aggression. She’s also kept the fractious EU united behind sanctions against Russia. Merkel, a former East German who speaks Russian, is by some lights the only Western leader whom Putin, a former KGB agent who learned German during his stint in Dresden, respects.

Russian President Vladimir Putin shakes hands with German Chancellor Angela Merkel after a press conference following their meeting at the Bocharov Ruchei state residence in Sochi on May 2, 2017.
She’s on to him.
Alexander Nemenov/AFP via Getty Images

The doozy was the refugee crisis. Merkel’s decision in 2015 not to close the borders to the arriving migrants seemed to break Merkelism’s pattern. It bitterly divided Germans. Many welcomed the huddled masses at the Munich train station, handing out water bottles and teddy bears. Yet others were appalled by the breakdown of order and felt overwhelmed by so many foreigners. Within a year, the rift within her own conservative bloc nearly brought down her government.

Merkel also divided the EU. Uncharacteristically, she didn’t coordinate with partner countries during the refugee crisis. A fault line already in the making between the bloc’s west and east cracked open. Ever since, Hungary, Poland and a few other countries have been sulking, obstructing reforms to Europe’s migration regime and much else.

As is her wont, Merkel incrementally changed course and started tightening migrant policy, with stricter rules on asylum, integration, deportation and more. But the question remains: What made her react seemingly out of character in 2015?

But I don’t believe it was out of character. Despite having few ideological convictions, she has a moral compass whose true north is decency. The daughter of a Lutheran pastor, she is devout, even though she doesn’t flaunt it. I recall a gathering where somebody asked her what she was reading. A book about mercy, she replied. She also feels, as do many of her compatriots, that post-Nazi Germany has a special ethical and historical duty to help those fleeing war.

The Cost of Merkelism

So much centrism — holding things together generally means shoving everybody into the middle — exacts a toll. One charge against Merkel is that she took the passion and confrontation out of politics, blurring the old lines between the major parties and thus accelerating their decline.

Sometimes she did this deliberately. Her (very successful) campaign strategy was described as “asymmetrical demobilization.” She made elections dull enough and distinctions woolly enough to keep many voters at home, especially — and this is the asymmetry — voters for the other guys.

Change in Voter Turnout in Federal Elections

Merkel practiced “asymmetrical demobilization,” which diminished participation

Note: Change is relative to 1994, the election cycle before Schroeder won.

Source: Der Bundeswahlleiter

Other times, she artlessly slipped into a technocratic tone that reassured centrist voters but enraged critics on the fringes. During the euro crisis, she presented the hard compromises she’d negotiated as “alternativeless,” an adjective that sounds just as awkward in German as in English.

But in a vibrant democracy, there must always be alternatives, even radical ones. With that rallying cry, a new populist party was born in 2013, called — what else? — the Alternative for Germany. Since then it has moved ever further to the extreme and xenophobic right. In 2017, the AfD entered the federal parliament, and it now polls at about 11%. Populism isn’t a German peculiarity, but Merkel bears some blame for midwifing it.

The Tao of Mutti

So there she is — 16 years, five U.K. prime ministers, four U.S. and French presidents, and uncountable summits later. Somehow she’s outlasted all challengers and opponents, domestic and foreign.

And she’s done more than that. She’s kept those outsized egos, usually male, at the negotiating tables, helped them climb down from their trees, avoided rising to their provocations. At some level, multilateralism is simply that: keeping everybody talking.

One lesson of Merkelism to students of leadership is that keeping your own ego under control when others don’t control theirs is one of the most effective instruments of power. The most vital character trait — one that voters should look for more often in candidates — is low vanity.

This much is certain: Merkel is the least vain world leader today. The photo that captures her best is perhaps this shot of her and her husband, another quantum chemist, on their way to a hike in the Alps, looking far from their best and not caring a hoot. Merkel is no-frills, the opposite of bombast and glitz.

German Chancellor Angela Merkel and her husband Joachim Sauer go for a walk on August 3, 2006 in Sexten, Italy. Merkel and Sauer are currently spending their holiday at the Alte Post hotel in the small town of Sexten in the Dolomite Alps, South Tyrol.
The opposite of bombast.
Ralph Orlowski/Getty Images Europe

In that sense, too, she’s been the foil to Trumpism in our time. That may be why Trump loathes her — he singled out Merkel, and Germany, for special helpings of his vitriol.

For Merkel, who still raves about her sojourn three decades ago in San Diego and used to see the U.S.-German relationship in almost existential terms, the Trump episode marked a historical rupture. All her assumptions about world politics went topsy-turvy once the U.S., the former protector of Germany, Europe and the free world, suddenly questioned NATO, collective defense, common values — in effect, the West as such. Nobody’s surprised when China and Russia, or even Turkey and Brazil, go rogue. But the U.S.?

As it turned out, Merkel outlasted Trump as well, like so many others. But she knows that Trumpism, and with it nationalism, may return, in four years or eight, potentially leaving Germany and Europe exposed and adrift between the superpowers. Holding things together is always only a temporary achievement. It will fall to others to repeat it, or not.

Will Merkel one day be considered a historic leader? Probably, but in the sense that she was transitional — the last gasp of a passing era. Hers was a time when Germany could still shelter — diplomatically, strategically and militarily — behind the protective shields of the Western Allies of World War II and the alliances that kept Europe safe during the Cold War. It was a time when post-heroism was not only sufficient but also appropriate in the German chancellery.

That era is ending. Germany’s friends, not least the U.S., will expect future chancellors to carry their share of the burdens that come with preserving international order. Germany will have to spend more on its army, and sometimes deploy it alongside friends. It may have to decide, as Merkel never unequivocally did, whether it sides with the West or with a rising and vibrant, but also menacing, China.

If Merkel inherited a reformed and booming economy, moreover, what she’s bequeathing is a country that feels exhausted. For the past 16 years, Germany has prospered largely thanks to the vaunted industrial prowess of its Mittelstand, the medium-sized and family-owned firms that specialize in some niche of the global economy. It’s unclear whether this same country with the same firms — but with a population that will shrink and age — can innovate enough to thrive in a new age of artificial intelligence and permanent disruption.

I will miss Merkel for her decency, her sharp analytical wit, her utter lack of pretension — and, above all, for her knack at keeping people who might otherwise go to war at the same table.

I won’t miss Merkel for her incrementalism when facing the big issues of the next generation: how to deal with global warming, how to keep Europe not only united but also free and safe in a world of aggressive autocrats, and how to modernize our economies so that all their members can flourish even as many traditional jobs disappear.

History’s verdict, I believe, will be that Merkel deserves huge and lasting credit for managing situations that could have become disasters, but that her departure became necessary for a new era to be born. Once Merkel walks out of her chancellery later this year, the post-heroic age in German history will be over. And that will be nothing to fear.

German Chancellor and leader of the Christian Democratic Union party, Angela Merkel (CDU) leaves the parliamentary compound of the Bundestag in Berlin on September 25, 2018, after the parliamentary group of the CDU/CSU elected a new leader.
Michael Kappeler/DPA/AFP via Getty Images

More On Bloomberg