A lackluster campaigner, Merkel barely scraped into office two years ago, after forging an uneasy coalition linking her Christian Democrats with their ideological rivals, the Social Democrats. Few people expected this political neophyte to be able to hold this partnership together for more than a few months, let alone blossom into a popular and effective leader with a knack for statesmanship. Yet since taking office she has been actively engaged in framing a new global agenda, from climate change and energy security to sustaining 4,000 peacekeeping troops in Afghanistan—which for Germany would have been unthinkable just a decade ago.
Merkel has shown she is not afraid to defy conventional wisdom and her willingness to resist pressures from media and business circles has bolstered her standing with the voters. She mended a relationship with the United States and the deeply unpopular president, but earned respect by criticizing Bush on such issues as climate change and the Guant?namo Bay detention facility. At the risk of infuriating Germany’s key energy and trading partners, she lectured Vladimir Putin in fluent Russian, about the dangers of his authoritarian tendencies. She condemned Mahmoud Ahmadinejad’s denial of the Holocaust, insisted Germany would always remain a staunch protector of Israel and backed U.S. calls for tougher sanctions against Iran—even though German firms reaped $5.7 billion in deals with Iran last year, more than any other Western country. And Germany’s booming business with China did not stop Merkel from provoking outrage in Beijing by recently hosting the Dalai Lama in her office.
But Merkel’s most serious challenges still lie ahead of her. She has achieved record approval ratings on the strength of her foreign policy, but with economic growth slowing and workers stepping up demands for higher wages, political pressures are mounting within Merkel’s coalition to backtrack on the cuts in retirement benefits and other austerity measures that propelled the recent recovery. Little has come of her attempts to break the stranglehold of Germany’s welfare state by appealing to her compatriots to show more entrepreneurial zeal in shaping their own destiny. And while her coalition has responded to the country’s plunging birthrate and aging population by extending the retirement age to 67, Merkel has been frustrated in her efforts to carry out a wider restructuring of the German economy.
She would much prefer to work with the free-market Free Democrats, and may try to form a coalition with them after the election scheduled for 2009. But for now, her efforts to overhaul the welfare state are impeded by her current partners, whose left-leaning constituents are threatening to bolt the party unless they roll back Merkel’s reforms—reforms that the country so desperately needs.
