EU institutions: Angela Merkel plots European reform

29 October 2013 – Der Spiegel (Hamburg)

The German chancellor finally seems ready to take control of – and responsibility for – Europe. But as her proposed reforms are in line with the Social Democrats, she needs an ally: the President of the European Parliament, Martin Schulz. excerpts.

It was during dinner in the Brussels Council building. Dessert had just been served, shortly before midnight, when Angela Merkel did what leaders in Europe have been asking her to do for months: show a desire to lead. The Eurozone countries would have to become more competitive, the Chancellor demanded. The previous inspections of the Commission had not been enough; from now on, there would have to be “a tougher commitment”. The “social dimension”, however, should be not ignored, the CDU Chief had realised. Europe needs a “qualitative leap”.

Merkel is determined to become the Chancellor of Europe in her third term of office. In the recent election the Germans gave her more votes than ever before; she is “the most important politician on the continent," according to The Economist, and she will soon be governing in Germany in a coalition with the second-largest party. It’s a propitious starting-line, Merkel is convinced, to push on with the project that will be her political legacy: the reform of the European Union. Indeed, the danger that the common currency will quickly collapse has been banished for the time being, and the Eurozone economy is showing renewed signs of life after a long dark spell. All the same, Merkel knows that the crisis can flare up again at any time. From France to Italy, the Euro-sceptic parties have the wind in their sails, the reforms in many of the indebted countries are faltering, and banks are hesitating to give out loans.

And so the Chancellor is preparing an offensive for European reform, and she has also grasped how the project can be moved ahead: together with the likely new coalition partners, the SPD, she wants her policy on Europe to be given a more social gloss. That gloss centres on programmes to combat youth unemployment and tax evasion and a Eurozone budget to kick-start growth. In exchange, Brussels should get more powers to oversee the financial and economic policies of the member states.

Mutti’s masterplan

Merkel intends to pursue her controversial doctrine in social-democratic garb, and the most important ally in the Chancellor's Office has already been picked out

Money for reform: Merkel intends to pursue her controversial doctrine in social-democratic garb, and the most important ally in the Chancellor's Office has already been picked out. Merkel wants to push her projects through in a duo with EU Parliament President Martin Schulz, who not only heads the SPD delegation in the coalition negotiations on European policy but has his eye on his next career move. First, he wants to be the lead candidate of the Socialists for the European elections in May. Then, provided he marshals enough votes, he intends to go after the presidency of the powerful Commission in Brussels. Merkel would finally be free of the man she once sponsored, the now unpopular incumbent José Manuel Barroso, and in tandem with Schulz she could get reforms for growth and competition underway.

The line of the new Berlin government is predictable: no Eurobonds, but more money for growth programmes and additional powers of inspection for Brussels. To push through with the new plan, Merkel, amiably referred to as “Mutti” in her own circles, has chosen a new favourite in the President of the EU Parliament – Schulz. Publicly, the SPD politician says “Angela Merkel is not my best friend.” When the microphones are turned off, though, the two speak of each other in tones of great respect.

Schulz regularly meets the German Chancellor in Berlin. They exchange SMS messages and hammer out compromises, most recently over the supplementary budget for the EU. Both, however, are against everything being regulated at the EU level, and they largely agree on the path towards to a stronger currency and economic union.

German ‘Schulz-pah’

For the Grand Coalition with the Social Democrats, Schulz would be an important link. He is close friends with SPD Chief Sigmar Gabriel, and Merkel can use him in Europe as well. The coming year’s elections to the European Parliament will be the first to be held under the terms of the Treaty of Lisbon. Consequently, the result must be taken into account in the nominations for Commission President put forward by the 28 leaders of the member states.

The 57-year-old Schulz has a good chance of landing the job, as over the years he has been assiduously acquiring allies, and he is counting on wide-ranging support in the European Parliament and the European Council, far beyond the ranks of his own Social Democratic Party. Merkel knows this, and she could get on well with Martin Schulz as the President of the Commission – not least because the SPD politician enjoys the confidence of French President François Hollande, which could help get the stuttering German-French motor back up and running.

Merkel has just one problem: as Chairman of the CDU, she cannot openly support an SPD candidate

Merkel has just one problem: as Chairman of the CDU, she cannot openly support an SPD candidate. In the European election campaigns, the two future coalition partners, the CDU and the SPD, will therefore pull in separate directions. Merkel, however, is striving to avoid stirring up any unnecessary confrontations with the Social Democrats. Last Thursday, at a meeting of the heads of the conservative European People's Party held to discuss the upcoming European elections, many argued that they should send a conservative candidate of their own to run against Schulz. Merkel, however, together with EU Council President Herman Van Rompuy, expressed great concern. The Chancellor has yet to declare her favourite for the influential post of President of the Commission to be filled following the election. Could it even be the SPD politician Schulz?

What is certain is that Angela Merkel could really use the help of the German Social Democrats if she wants to push ahead with her agenda in Europe.

Translated from the German by Anton Baer

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