For Germany, it’s been a mixed few months in terms of international headlines.
Europe’s biggest economy was the bad guy in the Greek crisis earlier this year, blamed for the austerity policies that the country attempted to reject.
It’s now Europe’s angel — the model that liberals around the continent (and the world) want their governments to copy in their acceptance of refugees travelling through Europe.
A lot of people have expressed confusion at this. How can Germany be so seemingly cruel to southern Europe and so positive about bringing in people fleeing a war-torn country?
But they both have the same root: Germany’s experiences in World War II.
First, Germany’s economic orthodoxy. In his book on austerity, political economist Mark Blyth explains the development of Ordoliberalism, an discipline that emphasises a mixed economy with a balance between the market and the state:
The German population was exhausted and hungry while the country’s capital stock was decimated. Fearing political instability, the postwar authorities needed growth, and like the population they governed, those authorities were suspicious of growth coming from “big-state” projects, whether from the left or the right. Second, the Freiburg school, which was not shy in hawking a growth project, emerged from the Nazi period unsullied and more or less intact.
Jörg Bibow at the Levy Economics Institute offers some pretty similar thoughts:
While aspiring to overcome traditional liberal views on economic order, the country did not join in the international triumph of Keynesian demand management either. The economic instabilities of the 1920s and the Great Depression were seen as a failure of laissez faire, or lack of government intervention of the right kind, namely, in organising and regulating its market order. Early practical experiences with Keynesian policies in overcoming the Great Depression in 1932-3, if anything, helped to discredit Keynesianism. The perception was that these “full employment policies” — seemingly inevitably — evolved into the full-blown command economy of the subsequent Nazi era.
This doesn’t seem too surprising. Germany had a brutal period of economic turmoil dating back to long before the Great Depression — hyperinflation and deflation both appeared during the 1920s, followed by mass unemployment as the depression unrolled.
The Nazi government’s economic control was focused towards war production at the expense of anything that got in the way, so it’s easy to see why the more pro-market and liberal element of ordoliberalism developed.
Given the economic chaos of the interwar years, and the painful reforms in the aftermath of WWII, it’s also not hard to see why untrammeled free market economics weren’t popular. People craved order and stability.
So unlike much of the rest of the world, Germany never had a particularly pro-Keynesian post-war orthodoxy.
Germany may have gone too far in the application of this mindset to the eurozone — combined with a panic that more profligate states would take advantage of Berlin, the ordoliberal system has been expanded to fit the whole continent.
But it’s not at all difficult to see why it developed in the historical context. A mixed system that emphasised a significant role for the state, but without grand spending projects must have seemed extremely compelling in the ashes of the Nazi economy, and while eastern Germany was coming under the control of the Soviet Union.
Now, to migration. A lot of commentators have been suggesting that Germany’s incredibly welcoming attitude towards refugees is to do with its demographic crisis. My colleague Oscar Williams-Grut rightly notes that while the UK’s population is set to climb considerably in the decades ahead, Germany’s is set to slide.
Attitudes are certainly different: British Prime Minister David Cameron says the UK can accommodate 20,000 Syrian refugees over the next five years, while Germany’s vice chancellor says the country could take 500,000 per year for several years to come.
But to me that doesn’t explain the issue. Other countries have demographic problems — for example, Japan and Russia. But neither is particularly warm to the idea of large-scale migration. In fact, they’re both pretty cold to the idea.
Other European countries, like Spain, Greece and Portugal are expecting declines larger than the one Germany is, but they’re not throwing their doors open to the world’s huddled masses.
I’ve been surprised by how little Germany’s war experiences have been mentioned in recent weeks. It’s crucial to understanding the country’s view of asylum and refugees, and why it departs so significantly from the other large European countries.
Germany still harbours a remarkable sense of guilt about the country’s WWII regime and the Holocaust, which itself caused enormous flows of refugees, and indirectly the founding of the state of Israel. The younger generation of German voters was born 50 years after the war, but the sense of collective responsibility remains with the older generation, which in other countries tends to be more anti-immigration.
Again, Germany’s immediate post-war and cold war experience is important. Ethnic Germans flooded into the country from neighbouring states after WWII, and more than 10 million came. Flows of people moving to find sanctuary have been comparatively minuscule almost everywhere else in Europe, certainly in the UK.
Many of the children and grandchildren of those who came to post-war Germany are citizens today, which could go some way to explaining their attitudes when it comes to accepting refugees.
West Germany had an extremely liberal asylum system and many people headed to the country from Yugoslavia in the late 1980s, with more coming as the Balkans erupted into war in the early 1990s. The Syrian migration trend is large, but it’s a development of an existing trend. Germany has not changed its stance — there is a long and easily traceable trend, rooted in the German history surrounding WWII.
But once you understand the history, it’s not just easier to explain — it’s clear that both impulses come from the same period in Germany’s past. That shouldn’t be surprising, given the scale of the event and the chaos of those years.
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