Schäuble’s role in Brussels: Merkel’s bogeyman

Chancellor Angela Merkel’s manner over the Greek conflict has been mostly obliging, while her finance minister Wolfgang Schäuble played the role of bad guy.

„No“ to Schäuble.   Foto: reuters

BERLIN taz | A historic moment? As if! When the German Chancellor stepped up to the microphone on Monday morning in Brussels, she was back in low-key Merkel mode. Appearing unruffled, she presented the results of the crisis summit: Greece would receive a new multi-billion bailout if it carried out the toughest of financial cutbacks: „All in all, the advantages outweigh the disadvantages.“ She said that she could advise the Bundestag to approve the plan „with complete conviction“. And no, she was not considering linking the ballot to a motion of confidence in her leadership.

The initial climax to this drama could hardly have been put in more sober terms than those chosen by the Chancellor. The unity of the eurozone hung in the balance. The leaders of the 19 EU states had debated for 17 hours. They had argued and tussled, revoked traditional alliances then patched them up again. But Merkel did not breathe a word about the fact that she and her finance minister Wolfgang Schäuble had won all down the line. The draconian austerity agreement signed by the Greek government could hardly be called a compromise.

For Merkel, this was crucial. She knows that many MPs in the CDU and CSU are at odds with a third bailout agreement. She desperately needed success in Brussels in order to scrape together a majority at the Bundestag’s special session on Friday.

In Berlin, Merkel’s speaker Steffen Seibert explained the agreement. A Greek journalist asked whether the conditions would be a humiliation for Athens. This „good agreement“, retorted Seibert, was one involving all states. The Greek Syriza government had signed it, France had played a major role, and so had Germany. Merkel’s speaker sold the whole deal along the lines of an old political principle: victors must appear modest in their hour of triumph.

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Dieser Beitrag ist die Übersetzung eines Textes vom Leiter des taz-Parlamentsbüros, Ulrich Schulte. Deutschsprachige Version.

In reality, Merkel smartly divided up the roles between herself and her finance minister. While she always appeared obliging, Wolfgang Schäuble flashed the torture instruments at the left-wing Syriza government. And in the end, it agreed to unprecedented austerity measures.

Harsh cutbacks

Schäuble’s manoeuvring began on Saturday afternoon when the finance ministers of the Eurogroup met to prepare Sunday’s meeting with the heads of state. He asked his state secretary to circulate a paper, which – allegedly – reflected the German government’s position. On it, Schäuble’s ministry sketched out two options for the Greek government to choose from in addition to harsh cutbacks.

The first proposal was an external trust fund, into which Greece was meant to transfer €50bn of assets – such as airport, ports or property. These could then be privatised without the Greek parliament having the power to prevent it.

The second proposal was even more controversial because it depicted a horror scenario that the German government had avoided up to this point: in the event that Greece could not get on top of its debts, a provisional exit from the eurozone would be possible, a „temporary Grexit“.

The Grexit bluff

Schäuble might as well have lobbed a burning torch into a gasoline depot with his paper. Italy’s head of government Matteo Renzi railed against the Germans’ obsession with economising (“Enough is enough“) and French president François Hollande brusquely rejected the idea.

But the Grexit option was a mere bluff, and it did not figure much in the rest of the summit meeting. Instead the government heads concentrated on keeping Greece in the euro. However, the proposal had served its purpose. By cracking the whip at the Greeks, Schäuble drove them further towards the German position. This is supported by the fact that an almost identical formulation was laid out in the closing statement of Schäuble’s trust fund proposal, even though it amounted to a vote of no confidence in the Syriza government.

On Monday morning, many European newspapers depicted Schäuble as Europe’s bogeyman, a disciplinarian who had imposed a diktat on Greece. But this view of things neglects Merkel’s role. At a federal press conference, government speaker Seibert confirmed that both options in the paper were coordinated with the Chancellor. A Grexit, however, was not the government’s priority. „That was a possible Plan B“, said Seibert, in the event that no agreement was reached, and if the Syriza government approved.

So Schäuble is not only Europe’s bogeyman: he’s also Merkel’s protective shield.

Translation: Lucy Renner Jones