Is Germany Outgrowing Europe?

October 6th, 2011 in Event Highlights, News

On October 5, 2011, Ulrike Guerot, head of the Berlin Office of the European Council on Foreign Relations (ECFR), gave a luncheon talk for faculty and graduate students on the economic crisis in the European Union, which she framed as a crisis of leadership in Germany. Guerot’s visit follows the publication, by the ECFR, of  What Does Germany Think about Europe, a collection of essays by German experts on politics, law, sociology, philosophy and the media, edited by Guerot and ECFR colleague Jacqueline Hénard. The new volume aims to elucidate Germany’s response to the Euro crisis, diverging attitudes toward the future of Europe, and other pressing topics in light of debates taking place within Germany. As Guerot puts it: “It is impossible to understand Germany’s behaviour on the European and global stages – on the euro, Libya or nuclear energy – without understanding the debates within Germany itself.”

In her talk at Boston University, Guerot examined Germany’s shifting relations within the European Union through the lens of the current economic crisis. While German support for European unity remains strong, the German public’s willingness to finance the bailouts of other European countries is on the decline. Germany faces a dilemma: allow the bailout of Greece to fail – setting the stage for the collapse of the eurozone – or greater fiscal integration. Guerot argued that allowing a Greek default would hurt Germany in the long term – given the widespread exposure to Greek debt – and could induce sovereign defaults in other countries.

The monetary union, with its “no bailout” clause is flawed, according to Guerot, and poses a threat to the political union. It is no longer possible, she argued, to have one without the other. While admitting the real risk of a Greek exit from the eurozone, she expressed her hope that Germany will realize its future lies within Europe and not outside. Ultimately, her desire is to see Europe move toward a system of eurobonds, which would be backed collectively by all the eurozone nations.

Related articles:

Germany: The Beleaguered European Island,” Open Democracy, September 9, 2011

Germany Goes Global: Farewell, Europe,” Open Democracy, September 14, 2011

Germany in Europe: No Longer Understood,” ECFR blog, October 14, 2011

For more updates, follow Ulrike Guerot on Twitter.

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