The United States had spent its resources dealing with increased threats from the Muslim world, and, after 2009, an increasingly aggressive Putin in Russia. Chinese expansionism in the South China Sea also absorbed American attention.
The EU encountered the challenges of absorbing a few – perhaps a few too many – new members states into its economic community, while attempting to encourage its existing members to deepen their commitments to the EU. Voters in EU member states rejected a proposed EU constitution in 2005, while newer member states gradually manifested symptoms of economic incompetence.
With both the United States and the EU otherwise engaged, the nations of the world looked to Germany, and to its chancellor Angela Merkel, for leadership. German foreign minister Frank-Walter Steinmeier writes:
Against this backdrop, Germany has remained remarkably stable. This is no small achievement, considering the country’s position in 2003, when the troubles of the United States and the EU were just beginning. At the time, many called Germany “the sick man of Europe.”
In this condition, Germany was an unlikely candidate for leadership. Steinmeier notes that “unemployment had peaked at above 12 percent, the economy had stagnated, social systems were overburdened,” and the German government had shown a too-lenient policy toward Putin’s Russia. The German federal court system later found that Germany had lost 1.2 billion euros, as the German government and the Russian government had not equally shared the burdens of projects undertaken in allegedly ‘equal’ partnership.
Within a remarkably short time, Germany turned itself around. The election of Angel Merkel as chancellor in late 2005, combined with a series of legislative reforms designed to trim back a too-generous set of government ‘handout’ social programs, allowed Germany to show its strength.
Those reforms laid the foundation for Germany’s return to economic strength, a strength that has lasted to the present day. And Germany’s reaction to the 2008 financial crisis only bolstered its economic position. German businesses focused on their advantages in manufacturing and were quick to exploit the huge opportunities in emerging markets, especially China. German workers wisely supported the model of export-led growth.
Germany’s quick climb to the top is reminiscent of an earlier such ascent. In the mid-1940s, at the end of WW2, Germany was so economically devastated that many observers thought that it would be permanently relegated to a ‘third world’ status.
Yet within a decade, Germany had rebounded so quickly that it was known as the Wirtschaftswunder – the ‘economic miracle.’
The first two decades of the twenty-first century may one day be known as a ‘miniature’ version of that Wirtschaftswunder. Whether or not that happens, Germany has in any case provided needed leadership for the EU during times of economic and diplomatic turmoil.
The next challenge for the EU, and for the world, is to manage the danger coming from the Islamic world. The EU faces desperate refugees seeking humanitarian aid and fleeing from violence in Muslim countries.
But hidden among those displaced persons are also violent jihadi extremists. The EU must find a way to distinguish between the innocent refugees and the Islamic extremists: a way to help the former and shut out the latter.
For this next great task, the EU, the United States, and Germany – the entire world, really, – will need courage, creativity, and leadership.
