Published daily by the Lowy Institute

Merkel mark II?

He’s not called the Scholzomat for nothing, but there are radical reforms on the new German chancellor’s agenda.

For the first time in post-war history, three parties have come together to form a majority in the Bundestag (Maheshkumar Painam/Unsplash)
For the first time in post-war history, three parties have come together to form a majority in the Bundestag (Maheshkumar Painam/Unsplash)
Published 15 Dec 2021 

Should the world expect four more years of Angela Merkel, “only with less hair”, as the leading broadsheet, Süeddeutsche Zeitung, ungenerously predicted of Germany’s shiny domed new chancellor, Olaf Scholz?

Scholz’s oratory skills are certainly up there with Merkel’s. When asked if his government would follow Australia and other nations in boycotting the Olympics in Beijing two days before he was sworn in as chancellor, Scholz, resembling a translation program gone haywire, said, “A world that has to cooperate is also all about using the signals of cooperation.” Any more questions?

Scholz’s ability to churn out phrases in any degree of meaninglessness can be breathtaking. He’s not known as the Scholzomat for nothing. In this, the 63-year-old Social Democrat is a worthy heir to Germany’s long-time leader. Loved by her people for her stability, audiences also rapidly changed TV channels whenever Merkel spoke.

Like Merkel, Scholz prefers a rational approach to politics. Like Merkel, he is widely considered a masterful puller of strings. In the difficult coalition that Merkel’s conservative Christian Democratic Union (CDU) and Scholz’s leftish Social Democratic Party (SPD) had formed in the last four years, Merkel and her four-years-younger vice chancellor were regarded as a complementary pair – a calm port in a stormy world.

For the first time, women make up half of the seats in the cabinet.

Scholz and his SPD owe their surprising resurgence in the election campaign – resulting in a close but clear victory in September – to voters regarding him as, by far, the safest set of hands. Among the candidates, the uncharismatic but experienced federal minister for finance appeared to offer continuity after 16 years of Merkel.

However, Scholz’s new government promises anything but.

The new coalition formed by the Social Democrats, the Greens and the liberal, pro-business, anti-tax Free Democrats (FDP) is a first, among many firsts, for Germany. For the first time in post-war history, three parties had to come together to form a majority in the Bundestag. For the first time, women make up half of the seats in the cabinet. For the first time, a chancellor did not use the traditional oath “So help me God” when sworn in.

“Dare More Progress” is the new mantra and title of the coalition contract. It is a nod to the reform government of Nobel Peace Prize winner and former chancellor Willy Brandt half a century ago and signals a clear break with 16 years of conservative rule.

German Chancellor Olaf Scholz is widely considered a masterful puller of strings (Attila Husejnow via Getty Images)

The 178-page coalition contract, signed by top politicians and approved by the members of the three very different partners, outlines a course that could transform Germany in the next four years. Planned projects range from hiking the minimum wage, to legalising marijuana and reducing the voting age from 18 to 16 years.

First up: the pandemic. The new health minister is Karl Lauterbach, a Harvard-trained epidemiologist who has been a frequent, high-profile commentator on the talk show circuit. He intends to accelerate Germany’s lagging Covid-19 vaccine booster program. And he wants to mandate vaccines for all – a screeching U-turn for German politicians who have until now ruled out compulsory jabs. The staggering spread of coronavirus amongst vaccine refuseniks, in a country where vaccination rates have stagnated at under 70 per cent, leaves the coalition with no alternative, says Lauterbach. Even the liberal FDP, who a few weeks ago dreamt of a freedom day to mark the end of the pandemic, agreed to change direction.

But the coalition’s big ticket task is retooling Germany’s economy to the climate crisis, making it ecologically sustainable while retaining the strength and competitiveness of its export industries. The coalition intends to accelerate this change and offer a model for the world to follow. The ambitious goals: by 2030, 80 per cent of electricity should come from renewable sources, up from 45 per cent last year (by comparison, only 24 per cent of Australia’s energy last year was generated from renewables). In tandem, 15 million electric cars will roll off the auto industry’s production lines. And they’ll be racing down the Autobahnen which will remain speed-limit free, in a concession to the “freedom” loving FDP, whose leader and the new finance minister, Christian Lindner, drives a Porsche. At the same time, the coalition has to make sure that the majority of these electric cars will be Volkswagens, Mercedes and BMWs. Hundreds of thousands of jobs and more than four per cent of the German economy depend on the car industry.

Internationally, the new government will press for more cooperation to fight the climate crisis. Chancellor Scholz wants to create, “a strong, open and sovereign European Union”, he said, before travelling last week to France and Poland, Germany’s biggest neighbours. The new government is treading an even more pro-European course than Merkel ever could. However, it will stay cautious when it comes to European guarantees backed by the German taxpayers for public and banking debts of other EU members. And it intends to deal more forcefully with breaches of democratic principles by increasingly authoritarian member states, such as Hungary and Poland.

Scholz has indicated he wants to do as Merkel did and keep the reins of German foreign policy firmly in his own hands.

The hardest break with the cautious and trade-oriented foreign policy of Angela Merkel is a new emphasis on human rights – mentioned 30 times in the coalition contract. The Greens and their foreign affairs minister, Annalena Baerbock, intend to be tougher in their dealings with dictatorial and aggressive regimes, such as Russia and China. The coalition contract demands “an immediate end of the attempts to destabilise” Ukraine, but stops short of naming the Russian regime of Vladimir Putin. And though China’s strongman Xi Jinping was one of the first to send his congratulations to the new chancellor, his diplomats might read passages they won’t like in the coalition contract. The document mentions the “systemic rivalry” with the regime in Beijing and its “human rights abuses”, especially in Xinjiang, and calls for a “comprehensive China strategy” with the aim of reducing European economic dependency. And it offers support to “democratic Taiwan” for its participation in international organisations.

It remains to be seen what will happen when these policies are put to the test. Will the gas pipeline Nord Stream 2 from Russia to Germany ever be opened, giving Moscow a key to selectively flip the on/off switch to energy supplies to its Eastern European neighbours? The Greens foreign minister Baerbock says no. Scholz’s SPD, meanwhile, backs the controversial pipeline. Scholz’s approach to China looks more cautious, too, as shown by his reluctance to take a position on a diplomatic boycott of the Olympics. And by appointing a seasoned career diplomat as his security adviser, Scholz has indicated he wants to do as Merkel did and keep the reins of German foreign policy firmly in his own hands.

And what does this bode for Australia? Australia is mentioned twice in the coalition contract. It is warmly called an “important partner in values” in the Indo-Pacific region. But, in the coalition’s championing of “effective sustainability standards” in environmental and climate contract clauses which the EU should include in any future trade agreement with Australia, Scott Morrison’s government may not be pleased.

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