Thursday, 19 March 2015

The Height of Impudence

The suggestion that the Greek government might seize the Goethe Institute in Athens, as part of its efforts to secure war reparations it considers it is owed by Germany, has a symbolic value far greater than any real estate gain. Paul Mason hopes it might encourage a German volte-face, much as Goethe changed his mind about the Greek struggle for independence, if only because a Grexit would weaken Europe's southern border and potentially embolden Russia, to US chagrin. I suspect that this is wishful thinking and that Washington is currently more concerned by rhetoric in Tel Aviv than in Athens.

Johann Wolfgang von Goethe has a significance in respect of the current friction between Greece and Germany, but less in terms of his philhellenism than in the idea of Germany as a beacon of European civilisation. This liberal conception, in which bourgeois culture is assumed to be independent of the state and a force for peace, is one of the twin strands that runs through the political culture of postwar Germany. The other strand is the Rechtsstaat, or just state, which sees the rule of law as the foundation of good government. The intellectual roots of this are Immanuel Kant's belief that there are universal principles that constitute a higher moral law: "The constitution of a state is eventually based on the morals of its citizens, which, in its turn, is based on the goodness of this constitution". These two strands are central to capitalist ideology in Germany (i.e. Ordoliberalism), but they are also increasingly central to EU policy as that becomes ever more Germanic.

The irony is that this should be working itself out through a focus on Greece, whose classical history was attractive to Goethe and other Germans partly because of its high regard for ethically-based law. The other irony is that the chief legal theorist of the Rechtsstaat in the twentieth century was Carl Schmitt, an academic jurist who acted as counsel to the Reich government of von Papen in 1932 when it dismissed the elected centre-left government of Prussia. This was a key step in the manoeuvrings of German conservatives that would culminate in their miscalculation of tactical support for Hitler. Schmitt became a member of the Nazi party in 1933 and an active anti-semite, though he was marginalised within a few years as unreliable. He remained an influential thinker in the postwar period because of his theories of state sovereignty and dictatorship and his critique of liberal democracy.

The presumption of the Rechtsstaat is that your own house is in order, while the legacy of Goethe is that Germany - despite the wrong turns of the twentieth century - has a legitimate claim to be a civic exemplar for Europe. This is not "Prussian arrogance" so much as bourgeois smugness, but a smugness founded on a diligent respect for law and human rights. In Britain, we observe the former and dismiss it as officiousness, ignoring the sincerity of the latter. Unlike the American model, where the Constitution sets boundaries and the Supreme Court is only brought into play in extremis, the Rechtsstaat pervades all aspects of law from the parish upwards. In the UK, sovereignty is believed to reside in Parliament (however farcical that may be in reality), while in France it resides in the people (which legitimises revolutions). In Germany, sovereignty resides in the Basic Law, which binds the executive, legislature and judiciary at state and federal levels.

The twin strands can be seen clearly in the person of Wofgang Schauble, the German Finance Minister. According to Der Spiegel, "Schäuble takes laws, treaties and agreements very seriously because he considers rule of law to be a fundamental trait of Western democracy and civilization. The casualness with which his newly elected Greek colleagues want to run roughshod over EU agreements is deeply abhorrent to Schäuble ... The German finance minister regards Europe as an educational project, one for which the past seven decades has been about civilizing the Europeans and educating them about peace and democracy ... Athens' revolt is reminiscent of a teenager who doesn't want to accept the limits to personal freedom that living in a mutually dependent collective necessitates -- moreover, in a collective designed by his predecessors".

In contrast to the media presentation of the purse-lipped, realistic Schauble appalled by the gobby Varoufakis and his mad ideas, this portrait shows the German Finance Minister to be an idealist and Syriza to be pragmatists, despite the snidery about irresponsibility and immaturity. The tussle over wording in the various communiques this year has been presented as a slippery Greece seeking to big up small (or nonexistent) gains and a pedantic Germany insistent on undermining those claims. In fact, what this shows is Greece doing what EU politicians have traditionally done - i.e. fudge and seek interpretative latitude - while it is Germany that is departing from EU tradition in refusing to make allowances for domestic political pressure. This suggests that the EU core, led by Germany, sees austerity as a one-time opportunity to "rectify" Greece, and perhaps even an opportunity to prepare for euro 2.0.

According to Der Spiegel, "For Yanis Varoufakis, the euro is a defective currency. For Schäuble, it is his legacy" (the former is unarguable, the latter debatable). For over twenty years, Schauble has been a proponent of tighter integration for a "hard core" of EU states, centred on a Franco-German axis. He expressed scepticism about the readiness of peripheral nations like Greece to join the euro in the 90s, and has repeatedly worried about the political drag caused by the anti-federalism and opportunism of the UK. For him, the danger of the EU project being compromised is greater than the danger of a Grexit or a two-speed Europe. The emerging danger for the European "periphery" is not that the euro is a new "cross of gold", but that some of its architects would prefer it to be more like the bed of Procrustes. In other words, simple pain may give way to more radical surgery.

While the concern for executive integrity is expressed in terms of the EU, or at least its core, the roots of Schauble's obduracy lie in the Schmittian belief that the authority of the state to act in the interests of the community is fundamental, and that the state must resist being beleaguered by group interests. Schauble sees the periphery as a set of group interests unwilling to fully integrate - i.e. to accept the rules of "a collective designed by [their] predecessors". Domestically, this is echoed by his view on immigration which is favourable (for pragmatic reasons, anticipating Germany's demographic decline) but unyielding in its demand for complete commitment to the community: "Integration: yes — double citizenship: no". While he isn't going to emulate the "Prussian coup" of 1932 and demand a change of government in Athens, the suspicion is that Schauble (if not Merkel) would be willing to amputate the "gangrenous" limb of Greece.

If Schauble's stance towards Greece is heavily informed by Ordoliberalism, in its concern with state (i.e. core EU) integrity as much as fiscal rectitude, it also echoes earlier classical liberal views on responsibility and the mission of civilisation, hence the language characterising the Greeks as "foolishly naive" and untrustworthy and mendacious for questioning the logic of austerity. This is where Schauble starts to sound less like Goethe and more like Charles Trevelyan, the UK Treasury official (and joint-architect of the British Civil Service) who considered the Irish Famine of 1845-52 to be "the judgement of God on an indolent and unself-reliant people, and as God has sent the calamity to teach the Irish a lesson, that calamity must not be too much mitigated: the selfish and indolent must learn their lesson so that a new and improved state of affairs must arise".

This is not to suggest an imperialist mindset in Berlin. Rather the similarities concern the conflict of "progressive" and "backward" forms of capital. It needs to be remembered that the racism of the Victorian establishment, which strikes us as offensive now, was unremarkable in the nineteenth century. Far more significant was the belief of the Whigs (in government 1846-52) that Irish landowners, many of whom were absentee Tories, were failing to properly develop Irish agriculture - i.e. to invest in larger farms and improvements - which was a continuation of their critique of the Corn Laws, whose repeal in 1846 had brought them to office. The modern parallel is the disdain of North European big capital for the oligarchic capital of Greece - the diaplekomenoi, or "entangled ones" - which it believes is as much of a hindrance to the necessary "restructuring" of the Greek economy as the "bloated" public sector.

The UK government provided £7m in famine relief to Ireland in the form of workhouse support, soup-kitchens and pointless public works (deliberately unproductive to avoid damaging private enterprise). In contrast, it compensated West Indian slave-owners to the tune of £20m in the 1830s (you can think of this "superior" claim as equivalent to the bailout of European banks). The Irish Poor Law Extension Act of 1847 shifted the responsibility for relief funds wholly onto Irish ratepayers (i.e. landlords and tenant farmers) in the spirit of liberal self-reliance. This exacerbated the famine because the sums raised were inadequate; because the requirement that landlords pay the rates of small tenants triggered mass evictions to consolidate tenancies; and because tenants holding more than a quarter of an acre were barred from assistance, prompting many to abandon their holdings. A private sector failure was transformed into a public sector crisis.

In the circumstances, the suggestion by Declan Costello, of the European Commission Directorate, that the Greek government should not unilaterally pass its "humanitarian crisis" bill to alleviate poverty looks obtuse. Fortunately, Costello is not representative of Europe as a whole, any more than Schauble is representative of all Germans. On the issue of wartime reparations, Gesine Schwan of the SPD notes: "It would be good for us Germans to sweep up after ourselves in terms of our history. Victims and descendants have longer memories than perpetrators and descendants". If Schauble doubts this, he could perhaps ask Declan Costello how Charles Trevelyan is still viewed in Ireland.



  2. It seems odd that, despite the constant political weakness of bourgeois liberalism in Germany, it has in many ways remained the main exemplar of bourgeois culture and ideology.

  3. I have a much better understanding of the German position from this piece. What about the Greek position? Why don't the Greeks want to leave the Euro?

    According to the above article the Elgin marbles are priceless. If the UK gave them back to Greece they could use them as collateral for further loans. The British Museum would then have a large capital gains tax liability even though a gift HMRC would treat it as a sale. Priceless minus whatever sum Lord Elgin paid for them is still a big number. The BM would then have to start selling other items to pay the capital gains tax. Given the large numbers involved this could become a major source of UK government income. This plan could simultaneously help Greece and pay down the UK national debt The slight downside is the BM would be empty at the end of it.

    If you know anyone in power please pass this on. A simple solution is sometimes overlooked.