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📧 A very warm welcome to our 28 intriguing new subscribers this week. Join them here👇
Last week's edition on Afghanistan was by far our most popular edition so far! Thank you to everyone who read, liked, and shared our work. We love writing and it’s extra gratifying when you love the result.
Okay, group love-in over. The fact that our two most popular stories (Afghanistan and Israel/Palestine) were both huge mainstream media stories at the time of writing has taught us two lessons:
We've been worried that covering things that are already in the news would bore you, but in fact you like us adding our voice to the mix (particularly when we can think of something new to say!)
You prefer when we give you tools and frameworks to help you think for yourself rather than simply being told what to think
So the good news is we hear you, and we're gonna give you more of what you want. But we can’t cover Afghanistan again, so this week we present something equally, if not more important:
🍻 Your guide to the German election: modern Germany, where it’s going, and why it matters to the world.
(And if unlike the US you just can’t quit Afghanistan, we’ve included two extra morsels at the bottom of the newsletter)
🍻 Part 1: The making of modern Germany
Germany has made many contributions to the world, including:
Santa Claus and the Easter Bunny (I genuinely didn’t know this)
Vocab that English speakers wish we had
Labelling the pairing of beer with potatoes ‘cultural’ so no one can criticise John’s preferred diet
And arguably the world’s best eye-roll from Chancellor Angela Merkel:
Over the past two decades, Germany has levelled-up its game in world geopolitics, growing to become the political and economic leader of the European Union (EU).
Chancellor Merkel has guided 16 of those 20 years. Under her leadership, Germany has weathered the Eurozone-debt crisis, absorbed ~1 million refugees fleeing the Syrian civil war, and managed to emerge relatively unscathed from former President Trump’s tweetstorms about disbanding NATO.
In fact, Merkel is so steadfast and reliable, that one of her political slogans has simply been: “you know me” (surely nothing screams low-key boss vibes more than that).
But as she winds down her term and Germany gears up for its general election on 26 September, the country is facing some serious foreign policy challenges. But, before we look to the future, let’s revisit the past…
Germany’s ‘difficult’ history
Back in my day, ‘Modern History’ in Australian high schools was basically the study of What Germany Did and How Australia Stopped It (I also took Ancient History and definitely use my knowledge of the Minoan civilisation every day 🙄).
The tl;dr of modern Germany goes something like this:
Turn of the century superpower 👉 Lost WW1 👉 Financial crisis 👉 Lost WW2 👉 Split in half between free Europe and the Soviet Union 👉 Reunited 👉 The Germany we all know and love today.
What a ride.
Modern Germany has a complex relationship with its catastrophic past. The country’s psyche has been so scarred by a full century of war and ideological battle that its politics remains deeply sceptical of military force.
So while Germany has been a central part of the NATO security alliance with other Western allies, its guiding political principles in the 21st century have been stable economic growth, stable politics, and stable alliances.
Did I mention the word 'stable'?
Modern Germany and Europe
Since WW2, Germany has benefited hugely from the liberal world order (a ten-dollar term for the United Nations, free-trade, and globalisation in general).
Germany is now the most economically powerful country in the EU, much to the chagrin of its French neighbours.
German GDP is the fourth largest in the world behind the US, China, Japan, and ahead of India. Fuelled by efficient industriousness, precise engineering, and other hilarious clichés, Germany’s biggest companies have largely stayed under the radar while they fuelled the country’s economic success.
And because wealth = power, Germany is also the big political cheese in the EU. Other reasons like a position in the middle of Europe (it borders nine countries by my count), its large population (by European standards), and a high level of education, all reinforce Germany as the de-facto leader of Europe.
Why Germany matters to the world
W = The world
E = Europe
G = Germany
Then by the mathematical law of transitive properties: if G matters to E, and E matters to W, then G matters to W.
(Can you tell I have been nostalgically reading my old high school workbooks and am keen to work references in no matter how irrelevant they are? 😂)
Okay, sorry I’ll explain more seriously.
If Germany is vital to the EU for helping to navigate the organisation’s many problems, eg:
maintaining the common market
ensuring open but secure borders
managing collective security threats like terrorism and political extremism
preventing the rise of euro-scepticism
...and if a unified and stable EU is vital to the world for helping to navigate the world’s many problems, eg:
geopolitical competition between the US and China and Russia
looming economic problems like low growth and inequality
social issues, like terrorism and the refugee crisis
regulating technology and big business
...then Germany, its politics, and its policies are vital to the whole world.
Anyway, you get it, there’s a lot at stake in the upcoming German elections. So let's take a closer look at what to expect…
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🥨 Part 2: The election and Germany’s future
I learned two things this week:
‘Backpfeifengesicht’ means ‘punching-bag face’ and is now in my daily vocabulary
German politics is weird, for example:
👆 That dapper, sassy gentleman is a member of Germany’s parliament, the Bundestag. Elected in 1979, Jakob Mierscheid has sat on parliamentary committees, published articles in academic journals, and even quoted Alfred Lord Tennyson from the floor of the Bundestag.
Except Mierscheid is entirely fictional.
The ‘Phantom of the Bundestag’ was allegedly made up by two German politicians in the Bundestag’s cafeteria to replace a recently deceased colleague. Since then, his legend has grown and Germans seem to treat Mierscheid as halfway between a joke and a symbolic representation of ordinary German people… I think?
I dunno, as I said, German politics is weird.
How does the German election work?
I’ve researched this most of the week and I’m still not entirely sure how the German Parliament is elected. Here’s how I think it works:
The Bundestag has 598 permanent seats. Every citizen gets two votes - the first vote goes directly to a local candidate, the second goes to a political party.
Germany has 299 constituencies, and every candidate who wins a seat based on the first vote is guaranteed a seat in the Bundestag.
Then the remaining 299 seats are divided among the political parties according to the proportion of the votes they receive.
Extra ‘overhang seats’ are added if a party has more candidates directly elected (via the first vote) than it is entitled to (via the second vote). That’s why there are currently 709 elected members in the Bundestag.
Look, I fell asleep reading about the vagaries of the election system, which I took as a sign to direct the extra keen beans to this simple explainer, and to this remarkable resource that explains the electoral systems of the world in detail.
So who elects the Chancellor?
The Chancellor of Germany is the political leader of the country. Germany also has a President, but the role is ceremonial and has no real power. Kind of like the Queen in the UK, or the court system in China.
As in many countries, the German Chancellor is not directly elected by the people, but by Parliament. Because German elections almost always end in coalition governments, the Chancellor of Germany is usually the head of the party with the most votes in the ruling coalition.
Introducing the 2021 ‘Chancellor of Germany’ draft class
…aka the leader of free Europe (tbh my grandfather wouldn’t love that sentence).
Most likely to get selected #1
Armin Laschet (Christian Democratic Union/Christian Social Union). The CDU/CSU is Merkel’s party, and Laschet is very much in the Merkel mould. Because his party is a political powerhouse in Germany, Laschet has a good chance of winning.
Olaf Scholz (Social Democratic Party). Scholz is Germany’s finance minister in the current CDU/CSU - SPD coalition. If Germany voted directly for the Chancellor like the US does for President, he’d win.
Less likely but not total wildcards
Annalena Baerbock (Alliance 90/The Greens). Although a very popular party, the Greens have been slipping in the polls lately. Baerbock isn’t completely out of the race though.
Christian Lindner (Free Democratic Party). Not popular enough to be a major player, FDP support might prove crucial to any of the major parties forming a ruling coalition. Could the FDP leverage that power into making their candidate the Chancellor? Probably not.
Likely to go undrafted
Alice Weidel/Tino Chrupalla (Alternative for Germany). A super right wing party that tends to get more support than sensible people would like.
Janine Wissler/Dietmar Bartsch (The Left). A super left wing party that wants Germany to withdraw from NATO and tends to get more support than sensible people would like.
Can’t you just tell me who’s going to get selected?
Nope. We refuse to be Nate Silveresque sell-you-a-narrative grifters. Besides, unless you're a political strategist working for one of the candidates, why do you even care about polls?
The next Chancellor’s foreign policy challenges
Quite apart from being stuck between Russia, China, and the US, as Helen said above, Germany is also responsible for holding the EU project together. That’s why I’d argue that the Chancellor of Germany is the second most important job in the Western Hemisphere (no prizes for guessing first, and no Boris, it ain’t you).
🦅 The US. A close German ally, particularly under Merkel’s leadership, but it's far from an easy relationship.
Key issue: The US probably remains Germany's (and the EU’s) most important ally, but Germany’s policies toward Russia and China have angered Washington. The next Chancellor must balance pressure from the US with the EU’s interests in Russia and China.
What next? Trump supposedly did a lot of damage to the US-Germany/EU relationship, vindicating those in Europe who want to reduce the region’s reliance on the US. We suspect this is half true, and half Europeans using Trump as validation of their genetic suspicion of all things American (“nein Herr Trump, cheese can never come in a can”). In any event, the next Chancellor will almost certainly try to emulate Merkel’s warm relationship with Washington.
🐻 Russia. Germany’s traditional foe, but Merkel has been criticised for trying to foster closer relations with Putin. In fact, the EU vetoed her plans for a Russia-EU summit two months ago.
Key issue: Nord Stream 2 - an undersea gas pipeline from St. Petersburg to Germany’s northern coast under the Baltic Sea - is almost completed.
What next? Germany needs cheap, reliable energy via state-of-the-art infrastructure, and Putin wants to increase Germany’s dependence on Russia. Of course the deal angered the US, which doesn’t like anything that increases Russia’s power in Europe. The next Chancellor will have to navigate the diplomatic obstacles caused by increasingly hostile US-Russia relations.
🐼 China. Vital to Germany’s export-led economy, but there’s growing suspicion of China’s Communist Party (CCP) political power.
Key issue: Germany sells lots of stuff to China (40% of VW global sales are in China), but public sentiment is growing increasingly wary of China’s political and economic power. The almost concluded China-EU trade deal now looks to be on thin ice thanks to the human rights situation in Xinjiang and US pressure. In fact, the German Parliament recently passed a law requiring German companies to prove that their supply chains are ‘human-rights abuse free’ by 2023, which has angered China.
What next? From the perspective of the CCP, you’re either with them or against them. We think Germany’s next Chancellor will likely face an early test of allegiance from China. How will Germany’s new Chancellor respond? Will they take a firmer stance against China which would please the US (and many Germans), or will they continue Merkel’s policy of focusing on the economic benefit of closer relations with China? (Spoiler alert: we guess the latter).
🧀 And finally, the EU. Will the new Chancellor be able to hold the EU jalopy together?
Who knows. What I do know is that whomever’s elected Chancellor in October has got a hell of a job ahead.
➕ Extra intrigue
Latin America’s startup scene is booming. In the first half of 2021, LatAm saw a total of $6.2 billion in venture capital, more than $4.1 billion invested across all of 2020. The investment focus has been on fintech startups that create products for LatAm’s large unbanked and underbanked population.
At the other end of the investment scale, Chinese officials have hinted that Chinese firms with large amounts of sensitive data may be banned from going public in the US. Chinese companies that have already gone public in the US, such as Alibaba Group, will have to seek approval for additional share offerings.
It’s never a good thing when a police superintendent has the nickname ‘Jo Ferrari’. So you’ll not be hugely surprised to learn that last Tuesday Thitisan Utthanaphon, a regional police chief in Thailand, (aka Jo Ferrari) was arrested for murdering a suspect after the suspect had refused to pay a bribe (again, his nickname was ‘Jo Ferrari’). Thai police allowed the disgraced officer to hold a press conference and apologise to the nation for his ‘error’.
Recent research for the Freedom House Organisation shows that island-states in Africa tend to be more democratic compared to the rest of the continent. The smaller size of island nations encourages civic engagement and allows better public services, while the relative isolation protects them from wars. May we suggest São Tomé and Príncipe for all your next civil-strife-free holiday and investment needs?
Your extra Afghanistan tidbit for sticking with us to the end
🗨 Quote of the week:
Afghan President Ashraf Ghani fled Kabul so quickly fearing execution by the Taliban that aides who returned from a lunch break wondered where he'd gone.
- Courtesy of the Next Draft Newsletter.
📕 Read of the week: The War in Afghanistan Is What Happens When McKinsey Types Run Everything, by Matt Stoller (h/t Mike Chen).
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