Hoover Daily Report

Germany's Angela Merkel Treads Softly With Russia's Putin On Ukraine

via Wall Street Journal Europe
Tuesday, April 8, 2014

BERLIN—German Chancellor Angela Merkel's government is quietly pursuing a more conciliatory course with Russia, a shift that reflects a strategy to protect national business interests and assuage a public increasingly wary of antagonizing Moscow.

While continuing to warn Russian President Vladimir Putin against threatening Ukraine, Ms. Merkel—who earlier said Russia could face massive political and economic damage for its annexation of Crimea—is now emphasizing the need for more dialogue with the Kremlin.

In recent days, the German leader and other senior government officials have repeatedly stressed that de-escalating tensions with Russia, rather than provoking it with a more forceful response, is their top priority. Berlin has also pushed back on pressure from Poland and other Eastern European countries to station more North Atlantic Treaty Organization troops along the security alliance's eastern flank. And German Foreign Minister Frank-Walter Steinmeier said he saw no way for Ukraine to join NATO.

On Monday, Ms. Merkel's spokesman, Steffen Seibert, said it was disappointing that Mr. Putin hadn't withdrawn Russian troops from the Ukrainian border as he had pledged to do during a phone call with the chancellor last week. In response to the latest tensions in eastern Ukraine, Mr. Seibert said all parties needed to avoid a further escalation.

The chancellor's stern rhetoric earlier in the crisis was heralded in Europe's capitals as a sign Germany was finally asserting its regional leadership and willing to risk its decadeslong rapprochement with Moscow. Berlin's softer approach suggests Ms. Merkel may not be ready to heed calls for Germany to take on a more forceful role in international affairs and will instead maintain the country's reliance on the U.S. to take the lead.

Before the Ukraine crisis, several prominent German leaders, including President Joachim Gauck, said Germany needed to move beyond the shadow of World War II and assume more global responsibility. In a landmark January speech, Mr. Gauck called on Germany "to do more for the security that others have guaranteed for decades."

German leaders were caught off guard by Russia's willingness to use military might to achieve its strategic aims in Ukraine. That miscalculation, German political observers say, unnerved the German public and helps explain Berlin's realignment of its strategy.

German Foreign Minister Frank-Walter Steinmeier, right, and Ukraine Premier Arseniy Yatsenyuk in Kiev last month Reuters "This response is reflexive rather than reasoned," says Josef Joffe, co-publisher of German weekly Die Zeit and a senior fellow at Stanford University. "There is a permanent détente impulse built into German foreign policy."

That impulse was born out of West Germany's so-called Ostpolitik, a strategy of engagement with the Eastern Bloc that began in the late 1960s. Many Germans believe those policies, first championed by Social Democrat Chancellor Willy Brandt, helped prevent an armed confrontation with the Soviet Union and allowed for German reunification.

That legacy is one reason all three of Ms. Merkel's living predecessors as chancellor— Helmut Schmidt and Gerhard Schröder of the Social Democrats and Helmut Kohl of her own Christian Democrats—have expressed sympathy for Russia's actions.

"There's been a lack of sensitivity in dealing with our Russian neighbor, especially President Putin," ex-Chancellor Helmut Kohl told the daily Bild in an interview last month.

When Finance Minister Wolfgang Schäuble, one of the more conservative members of Ms. Merkel's cabinet, recently compared Mr. Putin's Crimean move to Hitler's invasion of the Sudetenland, he was attacked by politicians of all stripes who accused him of destabilizing Germany's relationship with Russia.

Even Ms. Merkel distanced herself from her senior minister, saying that the she viewed the Crimean situation as a "singular event."

As much of Europe has focused in recent days on what steps to take if Russia refuses to withdraw its troops from the Ukraine border, Germany has debated whether Mr. Schäuble's comments went too far.

"We've gotten caught up in navel gazing," says Joerg Forbrig, a senior program officer in Berlin with the German Marshall Fund, a think tank. "We've lost sight of the issues at hand."

Polls suggest most Germans want their country to maintain equal distance between Russia and the West and act as a mediator. Yet most believe Ms. Merkel has firmly aligned Germany with the West, according to a poll released last week by infratest dimap. More than 60% of Germans surveyed oppose sending the country's air force to strengthen NATO's eastern borders, the poll found.

The German public's aversion to confronting Russia is one reason for Ms. Merkel's change of course. The other is business.

Many of the country's blue-chip companies, from Siemens to Volkswagen have major investment in Russia. Though Germany's overall trade with Russia is fairly modest—Russia accounts for just 3% of overall exports—the companies active there count among Germany's most influential.The chief executives of Adidas AG, Thyssen-Krupp and DHL parent Deutsche Post have all recently criticized the West's handling of the Ukraine crisis, arguing that Mr. Putin was forced into a corner. All three companies have substantial operations in Russia.

Within days of Crimea's annexation, Siemens Chief Executive Joe Kaeser visited Mr. Putin at his official residence outside of Moscow and stressed the importance of Germany's economic ties with Russia. The public visit, which Mr. Kaeser said Ms. Merkel's office was informed about, was seen as an attempt to signal to Russia that commercial ties needn't suffer amid what the Siemens chief characterized as "temporary turbulence."

The head of Deutsche Bahn AG, Germany's state-owned railway, Rüdiger Grube, is also planning a trip to Russia. Deutsche Bahn, which has large freight and logistics arms, does a lot of business with Russia's state railway.

"For us, the top priority is de-escalation," Mr. Grube said at a recent news conference.

Ms. Merkel's supporters argue that she has succeeded in striking a balance between protecting German interests and meeting its international obligations within the European Union and NATO.

Wolfgang Ischinger, the head of the Munich Security Conference and a lobbyist for insurance giant Allianz SE, ejects the criticism leveled at Germany by Arizona Sen. John McCain and others who have chided Berlin for being too soft on Russia. "We are by far the country that would suffer the most" from a worsening of the crisis, said Mr. Ischinger, a former German ambassador to the U.S. "Not a single dollar will be lost in Arizona."