This is part of our special feature on The Crisis of European Integration.
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Intimate knowledge of political and economic players is no guarantee for proper analytical insights into political and economic developments. Sir Paul Lever was the British ambassador to Germany during the turbulent years of 1997 to 2003–a period where Germany was widely seen as the Sick Man of Europe. Located in Berlin, Lever had the chance to observe the calamities of the German political economy, and his later professional life gave him the opportunity to follow the economic and political resurrection of the country closely. Since the global financial crisis, Germany experienced a massive turnaround of its fate and today is widely seen as the dominant power in Europe–in Lever’s words: Berlin rules. Over the last couple of years, the idea that Germany is again dominating Europe has become a mainstream view, not only in media, but also in scholarly literature.
In the opening chapter of Berlin Rules, Lever hints at what to expect when he states that Germany “exercises power in Europe and provides the impetus for all of the EU’s decisions” but that it is “power without purpose.” What sounds like a compelling phrase that will be very much appreciated by German politicians who fear nothing more than being connected to the dark past of Germany, is actually nothing but an empty phrase that obscures more than it enlightens the reader.
One does not need to go back to Max Weber’s definition of power as “the ability of an individual or group to achieve their own goals or aims when others are trying to prevent them from realizing them” to be reminded that power always has a purpose. Power is a relational category where one side has a systematic advantage over the other and uses this advantage to its benefit. The question then is, what would be the purpose of German power? Lever needs another two-hundred and forty pages to get an answer: “Germany exercises power to protect the German economy and to enable it to play an influential role in the wider world.” What Lever comes up with is the 101 for any student of international relations, i.e. nation-states create and use their power base for supporting narrowly defined economic and political interests. In this respect, Germany is like any other nation-state. Not all nation-states are equal, though, and thus the question is to which degree German power differs from powers of other territorial units?
Like other students of the political economy of Germany, Lever makes the point that the base of Germany’s power is its economy, to be concrete: its strong manufacturing sector and its outstanding export performance. Lever adds the good state of its public finances, as well as the high level of social solidarity and security as sources of Germany’s economic success. The problem with such a list is that it is misleading and even wrong.
Let me start with the trade balance which Lever interprets in best mercantilist tradition as a sign of German power. He may have had nice lunches and dinners with CEOs of German exporters and learned about their ways of thinking, but those talks have not helped him to understand the accounting logics and macroeconomics of international economics.
Germany’s structural trade surplus is the result of a savings-investment imbalance and results in foreign exchange income that then shows up as current account surpluses. In the German case, those surpluses have reached a height that not only violates the EU’s macroeconomic imbalance rules, but also draws on a regular base critic from the IMF (not to mention US-governments) as the German surpluses are directly feeding into global (and also European) imbalances that threaten financial stability.
Rather than strength, the surpluses indicate a weakness of the German economy that suffers from a relatively low investment share and a too high savings ratio – private and public. It is quite difficult to praise an average growth rate of real GDP between 2010 and 2017 of 1.92 percent as the base of German power. Lever rightly points to the improvement of German public finances, but he fails to illustrate that the source of the so-called “Black Zero” is the drastic reduction of interest payments on German bonds.
According to the German Bundesbank, the monetary policy of the European Central Bank cut the average cost of borrowing of Germany’s federal, state, and municipal governments from around 4 percent in 2007 to 2 percent in 2016, thus creating savings of about €240bn in interest payments over this period. Quantitative easing on the side of the ECB, as well as its low-interest approach, is the direct result of the austerity recipe of Germany and its fiscal orthodoxy partners within the Eurozone that made fiscal policy not to a crisis solution but actually to a crisis contributor. Lever does not even touch upon these topics.
Similarly, he simply neglects the divisions of German labor markets where the share of insecure jobs has increased dramatically over the last decade. Not to mention, the strong increase of the Gini coefficient, a widely used measure of income inequality. True, income inequality is still on a low level, in particular in comparison to Lever’s home country, but is has risen fast and become a political issue over time that is reflected in the rise of the Alternative für Deutschland, a populist right-wing party that will soon send members to the Federal German parliament. Rather than presenting an analysis along those lines, Lever forces the reader through a collection of dull insights and stereotypes,missing his argument that “it’s the economy, stupid.”
Still, there is no doubt that Germany has become the most influential political-economic actor since the outbreak of the Eurozone crises. German coalition governments were able to create and lead a coalition of like-minded governments, mainly external surplus economies, which had the common interests to stabilize the common currency by rule-oriented policies and to avoid becoming paymasters for countries facing sovereign debt crises. Without this coalition, Germany would not have been able, for example, to make fiscal austerity to the crisis doctrine, nor would it have been able to avoid the introduction of instruments like Eurobonds, which were for a time even favored by the Commission. The critical variable for the understanding of Germany’s position in Europe, though, seems to me the weakness of other political players, mainly of France, as well as the attitude of the UK even before the leave-decision. In the best zero-sum perspective, the relative loss of decision-making power of two main actors led to a relative power gain of Germany. All this would have been great stuff to discuss for an insider like Paul Lever, but the reader can’t find it in the book.
The strongest part of a weak book is Lever’s explanation of Germany’s attraction to the EU. It may not be new to argue that Germany’s past opened the door for making the project of European integration to a vehicle of identity. Still, it is a convincing argument as it provides the crucial insight that Germany can exercise influence and power when it comes in “European disguise.” This also explains why all main political parties in Germany are strong supporters of European integration, as fighting for this project allows them to step outside German history and still follow through with German interests.
European integration is, for Germany, much more than an economic project, where the balance of costs and benefits decides about its virtues. For quite a long time, Germany was seen – rightly or wrongly–as the paymaster of Europe, as an economic giant and a political dwarf. This description no longer fits reality. Germany has become arguably the most critical economic as well as a political actor in the EU, and yet it is misleading to propose that the country is the sole ruler of Europe. Things are much more complex than retired ambassadors sense.
Reviewed by Kurt Huebner, University of British Columbia
Berlin Rules: Europe and the German Way
by Paul Lever
Publisher: I.B. Tauris
Hardcover / 288 pages / 2017
ISBN: 9781784539290
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Berlin Rules: Europe and the German Way
by Paul Lever
4.04 · Rating details · 90 ratings · 13 reviews
In the second half of the twentieth century, Germany became the dominant political and economic power in Europe - and the arbiter of all important EU decisions. Yet Germany's leadership of the EU is geared principally to the defence of German national interests. Germany exercises power in order to protect the German economy and to enable it to play an influential role in the wider world. Beyond that there is no underlying vision or purpose.In this book, former British ambassador in Berlin Paul Lever provides a unique insight into modern Germany. He shows how the country's history has influenced its current economic and political structures and provides important perspectives on its likely future challenges and choices, especially in the context of the 2015 refugee crisis which saw over 1 million immigrants offered a home in Germany.As Britain prepares to leave the European Union, this book will be essential reading and suggests the future shape of a Germany dominated Europe. (less)
Hardcover, 288 pages
Published May 30th 2017 by I. B. Tauris & Company
ISBN1784539295 (ISBN13: 9781784539290)
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Average rating4.04 · Rating details · 90 ratings · 13 reviews
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John Plowright
Apr 19, 2017John Plowright rated it really liked it
There are, broadly speaking, three types of books written by former British ambassadors.
There are those larger-than-life personalities who put themselves centre stage and delight in writing entertainingly – often indiscreetly – about all that they’ve witnessed. Sir Christopher Meyer’s ‘DC Confidential’ is one such book.
Then there are those who ‘bore for Britain’. ‘Envoy. A Diplomatic Journey’ by Sir Nicholas Barrington, former High Commissioner to Pakistan, abundantly disproves the adage that travel broadens the mind.
The third type comprises a cool appraisal of the history, geopolitics, political culture and possible trajectory of the country to which they’ve been attached. ‘Berlin Rules’ by Sir Paul Lever, British ambassador to Germany from 1997 to 2003, belongs firmly in this third category.
I need hardly point out that Brexit makes this volume particularly pertinent as all agree that Germany’s reactions will be key in deciding whatever deal is ultimately brokered with Europe and, given Germany’s economic and international importance, it will continue to play a major role in affecting Britain’s future economic prosperity and role in the world.
Sir Paul initially seems to subscribe to the Basil Fawlty ‘Don’t mention the war’ school of diplomacy. His tongue is firmly in cheek, however, when he writes that, “There have been occasions … when Germany has exercised power in a way which was, to put it mildly, not appreciated by the British government of the day” only to refer to Chancellor Kohl’s 1990 reunification of Germany and the 1992 refusal to intervene to prevent Britain crashing out of the Exchange Rate Mechanism, rather than world wars one or two. This teasing continues with the claim that, “dealing with Germany as an adversary” (over Brexit) “will be a novel experience”.
In fact, the book’s fourth chapter provides a discussion of German history although Sir Paul’s paradoxical thesis is that in its understandable efforts to expunge the legacy of the Third Reich, Germany “has … turned its back on the rest of its past as well.” Or, to put it another way, so fixated has the German state been, post c.1965, on the need to atone publicly for 1933-45 that it has had little time or inclination to attend to German history before that period.
Whilst there is doubtless much to Sir Paul’s argument, which is certainly elegantly expressed, he overstates in claiming that “Nothing which happened before 1945 is accorded any public value or respect”, given that 2017 represents the 500th anniversary of the start of the Protestant Reformation and the German National Tourism Organization has been busy promoting events, with Chancellor Merkel herself set to be the most distinguished pilgrim to Luther’s hometown of Eisleben.
Diplomats are always in danger of ‘going native’ but Sir Paul is far too shrewd and unsentimental to fall into that trap, although understandably seeing much to admire in modern-day Germany, not least precisely because it is so concerned to make amends for its relatively recent past, of which Merkel’s open-door policy towards immigrants fleeing Middle Eastern warzones represents a prime example. By contrast, Britain’s guilty conscience about its past seems to be limited to the odd feature listing our Top 10 imperial atrocities for the self-flagellating edification of readers of the ‘Guardian’ and ‘Independent’.
Sir Paul’s speculations on topics such as whether or not the stated German desire for an EU army will ever bear fruit and just what a German-led EU will look like in 20 years’ time remain just that - ‘speculations’. Although he is clearly well informed he could be completely wrong. Will there even be an EU in twenty years?
This is, inevitably, the least satisfactory section of the book, at times even degenerating into a statement of the obvious: “Germany’s leadership of the EU is geared principally to the defence of German national interests”. Nevertheless, in explaining what those interests are and why they’ve been pursued with such success this book sheds much light on why Berlin indeed rules and why that will continue, post-Brexit, to be a matter of the utmost interest for Britain.
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Owlseyes
May 15, 2019Owlseyes marked it as to-read
Shelves: germany-power, german-europe
https://www.spiked-online.com/2019/03... (less)
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Claudia Tessier
Jun 04, 2017Claudia Tessier rated it it was amazing
As an ex pat living in Berlin, I found this book informative and fascinating. I read it aloud to my husband, and it stimulated interesting conversations. We each came away with a much greater understanding of Germany, its government, its priorities, its influence, its roles in the EU, as well as the views of Great Britain in regard to the EU and Germany. I highly recommend this book to fellow ex pats as well as anyone who wants to better understand the EU, Germany, and Great Britain in these volatile times. (less)
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Reka Paul
Jan 16, 2018Reka Paul rated it liked it
Interesting views and nicely written, although, Mr Lever, please do get your facts and your Germans straight The Sieger Säule? Wolfgang Schaüble? And first and foremost where did you get the information that Germany has won the Football World Cup only three times??? (p.113)
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Steve Birchmore
Dec 06, 2018Steve Birchmore rated it it was amazing
Shelves: brexit, economics, geopolitics
This is a fascinating book, I think particularly for those interested in Brexit.
The book was written by Paul Lever who was British Ambassador to Germany from 1997 - 2003. During his earlier diplomatic career he specialised in European political, economic and security issues. His postings included service in NATO, in the European Commission, as chairman of the Joint Intelligence Committee and as EU and economic director of the Foreign Office. From 2004 to 2010 he was chairman of the Royal United Services Institute.
Clearly a man who knows his stuff.
The book is neither for or against Brexit and devotes little in the way of discussing likely repercussions or opportunities. The book is about modern Germany and its culture, politics and its economic and political power in the EU in which it is clearly the dominant power.
It gives much flesh to the bones which can be found in Yanis Varoufakis' books: 'And The Weak Suffer What They Must?' and 'Adults In The Room' that being that the real power in the EU is Germany. This may be obvious to many but from my experience of discussing the EU, it clearly is a contentious issue. That is not to say the book is in any way anti-German. On the contrary, I found myself feeling somewhat envious, and feeling that it is very unlikely that Britain will be able to negotiate any concessions whatsoever and that our political class and civil service, partly due to the different political cultures of Britain and Germany, will be very much outclassed by their German opposite numbers. That is not to say the book is 'sympathetic' to Germany or the Germans, but it does answer many of the thoughts that arise from listening to or reading Joseph Stiglitz's book on the euro and also both of Yanis Varoufakis's book mentioned previously. Clearly Stiglitz's hope for change in the EU and the euro will not get anywhere.
"Angela Merkel...has provided the answer to Henry Kissinger's apocryphal question: "Who do I call when I want to speak to Europe"...Germany is in the words of Professor William Paterson, Britain's leading academic expert on the country, a 'reluctant hegemon'. Power of the kind that Germany now wields in Europe is not something German Governments have consciously sought, nor is it welcome to German public opinion...The idea put forward by Nicholas Ridley in 1990, whcih brought his resignation from the British Government, that Economic and Monetary Union was a 'German racket designed to take over the whole of Europe', is as absurd now as it was then. It is not Germany that has set out to lead; it is others who have chosen to follow." PP26-27.
In Stiglitz's book on the Euro, Stiglitz makes many comparisons between the US Federal Reserve and the ECB, pointing out the Keynsian nature of the Fed' with its commitment to employment. Paul Lever points out that "German academic economists have traditionally looked to Hayek rather than to Keynes for their inspiration". Much more is written about this, but it emphasis that Stiglitz is on a hiding to nothing.
Lever goes on to write about Reunification between East and West Germany, pointing out that "Reunification involved massive painful adjustments for the former citizens of the GDR. There were also massive sacrifices for their fellow citizens in the West...The experience of reunification...had a huge psychological impact for Germany...It has also been crucial in influencing German attitudes to the euro. The former GDR was exposed to a strong currency and had to cope with the consequent loss of competitiveness...Reunification was a political project driven through at high economic cost. If the East Germans were able to bear the brunt of it, so too in German eyes, should the Greeks, the Irish, and Portuguese, who also chose, deliberately and knowingly, to give up their old currencies"" PP49.
The book covers many aspects of German culture and politics including its attitudes to its neighbours. However some points particularly caught my eye, including:
"What is different about Germany's use of the EU agenda in this way is that so much of its effort is aimed at reducing the competitiveness of firms in other countries, rather than enhancing the competitiveness of firms in Germany itself." Lever then mentions the complaints of James Dyson. and goes on to write: "Self-interest thus plays the dominant role in Germany's EU agenda" - PP187
In page 192 Lever writes of the Volkswagen emissions scandal.
A few pages on Lever writes about the 2015 'Refugee Crisis'. Which for me was striking and memorable, to a great extent due to Angela Merkel's decision - which was illustrative of who calls the shots in the EU: "To the surprise of everyone, including her own cabinet colleagues, and without any consultation with other Governments, Angela Merkel announced...Germany for its part, would offer asylum to all immigrants from Syria".
After Horst Seehofer, Bavarian minster took the lead in demanding Germany accept no more than 200,000 asylum seekers in any one year, Angela Merkel's response was to demand that Germany's EU partners should shoulder more of the burden. An attempt was made to persuade Turkey to take action and cut off the flow of refugees to Greece. "The agreement was negotiated directly between Angela Merkel and the Turkish President, Recep Tayyip Erdogan - much to the chagrin of Donald Tusk, the President of the EU Council, who thought that he was responsible for dealing with the Turks on the subject, but whose efforts Chancellor Merkel found inadequate."
Something I found particularly interesting in this episode which I was previously unaware of was that the Hungarian Government was unique amongst EU countries in doing exactly what it was supposed to do under the existing EU law/directives and registered immigrants as soon as they arrived on its territory. "For this the Hungarian prime minister, Victor Orban, a man of robust and nationalistic views,was vilified in the German and other European media". Yes. I remember it well.
I've underlined many other parts of the book, but I think I've written enough.
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A truly enlightening read. (less)
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Feb 08, 2018Scott Rauland rated it liked it
The author, Paul Lever, is a former British ambassador to Germany. He draws on his considerable experience to explain how the German political system works, and how that has influenced Germany’s views of the EU, the Euro, and European integration. It is well worth reading for anybody who wishes to know more about that.
Lever is a Euro-skeptic, and his views unfortunately color his analysis of how the EU has handled the many challenges it has faced and its prospects for leading the member states forward. As the title implies, Lever believes Germany dominates the EU, and doesn’t think there is much any of the other member states can do about it. His views strike me as strangely defeatist, time will tell whether his conclusion is correct - namely that “Those who voted to leave (the EU) will see nothing in the development of the EU itself to make them regret their choice.”
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Editorial Reviews
Review
“an incredibly well-researched and hugely enjoyable read”
(The Independent 2017-09-27)
‘Sir Paul Lever is one of our most distinguished ex-Ambassadors to Germany and he tries to explain Germany and the EU in this readable book… includes some delightful vignettes on Angela Merkel and Wolfgang Schäuble and nice personal stories about British political bigwigs… There is much to think about in this elegantly written book’
(Denis MacShane, Tribune, March 2017) --This text refers to an alternate kindle_edition edition.
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About the Author
Sir Paul Lever KCMG is a retired former British ambassador. Over the course of a long diplomatic career, his posts included assistant Under-Secretary at the FCO 1992–94; chairman of the Joint Intelligence Committee 1994–96; Director for EU and Economic Affairs at the FCO 1996–97; and Ambassador to Germany 1997–2003. After his retirement from the diplomatic service, he was Chairman of the Royal United Services Institute (RUSI). Lever was appointed CMG in 1991 and knighted KCMG in 1998. --This text refers to an alternate kindle_edition edition.
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Product details
File Size: 851 KB
Print Length: 288 pages
Publisher: I.B. Tauris; 1 edition (May 30, 2017)
Publication Date: May 30, 2017
Sold by: Amazon.com Services LLC
Language: English
ASIN: B07P9M75ZY
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Paul Lever
Paul has had a long career focusing on embedded computing. He has worked for and consulted with numerous large companies including Hughes Aircraft Company, Rockwell International, Intel, Microsoft, IBM, Atheros Communications, and Texas Instruments. In addition he has consulted with many smaller and mid-sized enterprises. Paul has founded two software companies, Blue Water Systems, Inc. and Codetelligence, Inc. Both were later acquired by larger public companies. Paul also taught Embedded and Real-Time Computing at the University of Washington for eight years.
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4.7 out of 5 stars
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Top Reviews
P. Dreyfus
4.0 out of 5 stars How powerful is the new Germany?
Reviewed in the United States on September 30, 2018
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Good information about the European Union. Something too many American's ignore.
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James McDonald
5.0 out of 5 stars For everyone who thought the EU is a German club ...
Reviewed in the United Kingdom on June 2, 2018
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For everyone who thought the EU is a German club, run by and for the benefit of Germany, this is the proof. Well written, and anyone interested in Germany and the outside world should read this.
7 people found this helpful
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Colin Heard
5.0 out of 5 stars If you want to know what the liberal establishment think - read this.
Reviewed in the United Kingdom on February 26, 2019
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The European Union was a tool created to allow Germany to dominate Europe by economic means when they failed to do so by military might. Countries surrounding Germany have been turned into economic colonies of Germany, supporting Germany by providing cheap labour for assembly lines. The Euro currency was designed to solve the problem of German industry being constantly undermined by the ever rising value of the German Mark. The Mark was buried in weaker currencies and saved from constant appreciation in value.
4 people found this helpful
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jmmw
5.0 out of 5 stars Clear sighted prediction of how EU will develop
Reviewed in the United Kingdom on August 10, 2017
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Based on deep knowledge of German politics, Ex ambassador Paul Lever sees EU as instrument of German hegemony. Whether in or out of EU, UK has to face up to its weaker economic and political power.
11 people found this helpful
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jiminlondon
5.0 out of 5 stars Packed with facts and insight.
Reviewed in the United Kingdom on August 20, 2019
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I really enjoyed thus book. Packed with facts that even an ardent remainder will be surprised to learn. The author, Paul Lever was the British ambassador to Germany for 6 years 1997-2003 some 13 years before the EU referendum. Yet his knowledge gives a good insight of the influence Germany has over the European Union, yet notebly the pragmatic approach of Angela Merkle for the benefit yes first Germany but close second for the whole of the EU.
One person found this helpful
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Amazon Customer
5.0 out of 5 stars I wish there was a book like this for every country
Reviewed in the United Kingdom on October 16, 2018
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I have lived in Germany and speak fluent German and must say this book has really shone light on so many previous conversations I have had with Germans about politics. I was often left bemused as to their dogmatic rationale but now it's so much clearer.
I only with there was a book like this for every country.
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