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Tuesday, May 28, 2013

Merkel Siding with China against the E.U.: Federalism Imploding?

In May 2013, German Chancellor Angela Merkel interjected herself into the brewing trade conflict between the E.U. and China. At issue was the European Commission’s proposal to impose import tariffs on some Chinese solar and telecommunications products in response to suspected dumping by China. Merkel’s involvement involves a conflict of interest for her and exploits a vulnerability in the E.U.’s federal system.
The conflict of interest involves Germany’s economic interest in maintaining trade with China and Merkel’s role at the E.U. level through the European Council. The Wall Street Journal reported at the time, “China is an increasingly important market for Germany’s export-oriented industry and Germany is China’s largest trading partner in Europe.” Among the E.U. states, Germany had the most to lose in a trading war. Furthermore, it was in the interest of Li Keqiang, China’s premier, to use Merkel to avert the proposed tariffs. Both Germany’s particular economic interests and Merkel being used by the Chinese government put Merkel at odds with her own duty at the E.U. level to contribute to governance in the E.U.’s interest rather than merely that of her own state.
Typically a conflict of interest involves the specter of gain for the person or institution pitted against its duty oriented to a larger good. In the case at hand, Merkel would be violating her duty at the E.U. level were she to sway E.U. policy toward Germany’s particular economic interest and away from that of the E.U. itself. She would be violating the duty even more expressly were she to intervene to do China’s bidding. In fact, such an action could be counted as treasonous. To the extent that Germany (and thus Merkel) have disproportionate influence at the E.U. level, the conflict of interest could be particularly costly for the European Union because German interests could eclipse that of the E.U. itself. Merkel’s exaggerated influence in the European Council’s deliberations is in itself a vulnerability in the E.U.’s federal system.
Dominance of Germany at the E.U. level risks E.U. law and policy being made in Germany’s interest, rather than in that of the E.U. itself. In addition to rendering the whole suboptimal, Germany’s dominance is not fair to the other states and their respective government officials. Moreover, the disproportionate power of the state governments altogether at the E.U. level due to the power of the European Council risks the E.U. itself being compromised (or even potentially ruined) by its states. If Merkel has enough influence at the E.U. level to get the Commission, the E.U.’s executive branch, to back off its proposed tariffs, then you can bet the state governments have too much influence in the federal government relative to the lower house (i.e., the European Parliament) and the executive branch.
       Flags of the E.U. and China, both of which are empires, albeit one being federal and the other centrally governed.  Both forms of government have drawbacks that can be exploited by the other.   Source: ipolitics.ca
As a government official of an E.U. state, Angela Merkel was not in a position at the time to be a mediator or third party between the E.U. and China. That would be a category mistake. Moreover, Germany is a political society in the E.U. rather than being equivalent to the European Union. Put another way, Germany, the E.U. and China do not constitute a threesome. It can be concluded, therefore, that the Chinese government was attempting to exploit a major vulnerability in the European Union by compromising Angela Merkel. She should have referred the Chinese premier to the president of the European Commission and express her own position to the president of the European Council. Both presidents are institutionally placed in the E.U. government to act in the interest of the E.U., unless the state governments (or an official of one) have sufficient power at the E.U. level to have the presidents do their bidding. Rather than exacerbating the E.U.’s vulnerability, Merkel should have acted to fortify E.U. governance even at the expense of her own state and herself.