A memorial service was held in Strasbourg yesterday for
former German Chancellor Helmut Kohl, who died on 16 June. Whilst his death
briefly made headlines in the British press, coverage of what was in effect a
European state funeral barely made a splash on this side of the channel. That
says a lot about the way the British media thinks of European issues. Kohl was,
after all, praised across the continent for being the lead architect in the
construction of the EU – an institution which the British electorate rejected
12 short months ago.
Politically, Kohl was a unifier: In addition to his role on
the European stage, he will forever be remembered as the Chancellor who
reunited Germany. But as the German media has highlighted, one of the great
ironies is that he never managed to unify his family: Even in death, he
remained estranged from his two sons. Nor, despite the eulogies, did he share
Angela Merkel’s vision, particularly with regard to the handling of the euro
crisis. Kohl was a historian with no interest in economics. His was the
politics of the grand vision, regardless of the cost. Very few politicians of
the post-war era would have attempted a project as ambitious as German
reunification. But no reputable economist agreed with the decision to convert
the Ostmark to the Deutschmark at a rate of 1:1 which gave East Germans a
short-lived income boost but which later wiped out the eastern economy.
Many German economists also believe that his push to
introduce the euro was badly handled. The decision to introduce a pan-European currency
without the appropriate leadership structure in the EU, and without a body to direct
common political and economic policies for the euro zone, means that the single
currency effectively remains little more than a glorified fixed income
mechanism. It was created on the basis of the competitive situation which
prevailed in the 1990s, and the pain associated with maintaining
competitiveness was always going to require significant domestic adjustment: Even
the European Commission was clear about this in the mid-1990s. As Die
Zeit put it, “a currency union was
created that only worked when the sun shone.
And when a storm, in the form of a financial crisis, came along, Mr.
Kohl’s peace project became the nucleus of the largest European crisis since
the war.”
Undoubtedly, Kohl’s solution to the Greek debt crisis would
have been to dip deeper into German pockets to find a financial solution. It
might even have worked – for a while. But it does not detract from the fact
that there are significant faults in the construction of monetary union which
need to be fixed. Although Kohl was not honest with his own electorate about
the costs of monetary union – living in Germany at the time, I was acutely
aware of that – we cannot pin all the blame for the euro zone’s ills on his
shoulders. Politicians in other countries signed up willingly to the euro
without realising that their own economies would have to bear a far greater
share of the adjustment burden than Germany.
The election of Emmanuel Macron as French President has been
hailed across the continent as a chance to rebuild the Franco-German axis that
drove the European project forward during the 1980s and 1990s. Macron has
proposed a common fiscal policy, a joint finance minister and the completion of
banking union, and surprisingly he has been given a sympathetic hearing in
Berlin. But we cannot so easily turn back the clock to the halcyon days of Kohl
and Mitterrand. The world has changed, with the rise of Asia having permanently
altered the global economic landscape. Nor is it so certain that the people of
Europe today share the vision for their continent which Kohl espoused. His was a
vision rooted in the past, designed to ensure that the horrors of the first half
of the twentieth century could not be repeated. That was, and is, a laudable
goal. But the survey evidence suggests that European electorates remain
sceptical of the need for further integration.
Europe in early 1995, after Kohl’s fourth election victory,
felt like a good place to be. The EU was a smaller, more manageable institution
with just 15 members. It was moving towards convergence at a pace which felt comfortable
and although progress towards a single currency was ongoing, there were
widespread doubts that it would be operational by 1999. It felt more like a
warm and fuzzy aspiration which made the federalists feel good yet was far
enough away not to worry the sceptics too much. In my view, that was Kohl’s
real achievement: He led the horse to water. It is unfortunate that the purity
of the water did not match up to expectations.
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