It’s hard to overstate the pace of the change now under way in Germany. A country that had been defined by its reluctance to deploy military force is now sending lethal weapons to Ukraine and promising €100 billion more in defence spending. The Nord Stream 2 pipeline, which would have ferried more Russian gas to Germany, has been abandoned. Germany has accepted Russia’s exclusion from the Swift banking system, in spite of the collateral economic damage. All of this adds up to the biggest policy shift that I can remember.
Perhaps the most significant change is in the tone of German public debate. Take last weekend’s gathering of 100,000 on Berlin’s streets: it was not your usual anti-war protest. There was outrage against the Kremlin and placards saying ‘Better a cold shower than Putin’s gas’. Astonishingly, the arms to Ukraine and the extra defence spending is backed by more than three-quarters of the German public. For the first time in living memory, there is also public outrage against Social Democratic party politicians – such as Gerhard Schröder and Manuela Schwesig – who lived in Vladimir Putin’s pocket for so long.
The German media has reassessed 16 years of Angela Merkel, her energy policy and her special relationships with dictators. ‘We’re starting over now,’ says the editor of Die Welt. ‘Now’s the chance to let go of old illusions that you have grown fond of and to accept the demanding seriousness of a complicated reality.’ Bild is delighted. ‘A left-wing Chancellor is implementing demands for which conservative and middle-class journalists and politicians have been ridiculed for many, many years,’ it says.
That Chancellor – Olaf Scholz – is now using the language of confrontation. ‘We are experiencing a turning point,’ he told the Reichstag on Sunday. ‘The world after won’t be the same… We are on the right side of history.’ It’s easy to get an impression of a Germany that now stands shoulder to shoulder with Britain, America and Eastern Europe. But all is not quite as it seems.
Look at the small print, and we see that the Swift sanctions exclude transactions for oil and gas. Germany imports almost half of its gas from Russia: it can’t just not pay for it. Also, the weapons Germany offered Ukraine – 1,000 anti-tank weapons and 500 ‘Stinger’ surface-to-air missiles – won’t affect the outcome of the war. And when it came to Nord Stream 2, Scholz – who was defending it as ‘a private enterprise’ not so long ago – had no choice. The Americans would have sanctioned every shareholder, every customer and every SPD politician involved with it had it gone ahead. Scholz, to his credit, accepted this.
What still needs to change in Germany is a major part of its governing philosophy: what you might call supply-chain mercantilism. In the German political mind, it is absolutely imperative to keep a current account surplus: i.e. to export more than you import.
Germany has made itself dependent on gas from Russia, and that will not be easy to reverse. It needs gas both for electricity generation and heating. More importantly, it is dependent on Russian gas to cap energy costs for its companies. Scholz has given the order to his government to examine alternatives to Russian gas, which is a good start. But there is no way for Germany to compensate fully for Russian gas imports in the case of a supply crisis. The dependence on Russia did not simply vanish during the past week.
To really assess the scale of the German transformation, it’s important to look at the long-term policy shifts. Robert Habeck, the economics minister, has been the driving force behind the strategy to invest in renewable energy sources – a laudable aim that will (eventually) make energy cheaper and cleaner. But as a by-product, it also increases Germany’s dependence on gas. Habeck’s Green party, which in the past opposed both nuclear energy and coal, has now said it has no ‘ideological’ red lines and is willing to reconsider plans to close down the country’s nuclear power plants. Even so, Germany will remain reliant on gas in two ways: as a transitional energy source until the renewable sources hit critical mass, and as a permanent source during periods when renewable output is low.
Unless the EU somehow builds up alternative gas supply sources and channels – perhaps the transport of liquefied natural gas from Spain – Germany will remain dependent on Russia. We should be cautious about the scale of the transformation, but when it comes to political language (and public opinion) it’s hard to deny that there’s been a shift. The test will come when Germany has to start making hard choices.