Merkel makes way
Olaf Scholz will be sworn in as Germany’s next chancellor on December 8th
Managing a three-party coalition will test his powers of patience and persuasion
TEN YEARS ago Christoph Holstein received a summons to the office of Olaf Scholz. Mr Scholz had just led the Social Democrats (SPD) to a stunning election win in the city-state of Hamburg, and had asked Mr Holstein to serve as government spokesman. He offered two pieces of guidance: “We are never offended, and we are never hysterical.” Mr Holstein, who now sits on Hamburg’s state council, found the advice so useful that it remains pinned up in his office today under the words: “Scholz’s first law”. Germans, and others, who have learned to appreciate the calm demeanour of Angela Merkel, now stepping down as chancellor after 16 years, should find reassurance in Mr Scholz, who will replace her on December 8th.
Talk to people who have worked with Mr Scholz throughout his long career, and several leitmotifs emerge. Credibility is one. “He only ever promises things he can achieve,” says Dorothee Martin, an SPD MP from Hamburg who got to know Mr Scholz over a decade ago. “This is the difference between him and other politicians.” Campaigning for election this summer, he boiled down his offer to a handful of modest proposals, all of which made it into the coalition deal agreed between the SPD and two smaller parties on November 24th: increasing Germany’s minimum wage, maintaining the state pension and building 400,000 housing units a year. Other colleagues, past and present, praise Mr Scholz’s work ethic and his pragmatism: stolid Hanseatic virtues typical of his home town.
Another thread is impatience. Mr Scholz shares Mrs Merkel’s air of serenity and competence. But unlike her, he struggles to mask his disdain for anyone he considers ill-briefed, a trait that can infuriate political antagonists. In Hamburg, aides to Mr Scholz frustrated by dissenters would shut them down by exclaiming “OWD”, short for Olaf will das! (“Olaf wants that”). Colleagues swear that Mr Scholz can be hilarious company. But his circuitous, convoluted style of public speaking will hardly satisfy those craving a more direct mode of communication from their chancellor. When challenged on his robotic persona earlier this year, Mr Scholz said he wanted to become chancellor, not a circus ringmaster. His press conferences are deathly.
Like many ageing social democrats, Mr Scholz spent his youth dabbling in radical leftism before, in his words, “detoxifying” himself into moderate social democracy in his twenties. He bounced between party, city and federal politics for decades, suffering reverses (being booted from a senior SPD role in 2004, the G20 riots in Hamburg in 2017, losing a party leadership bid in 2019) as well as victories (two huge election wins in Hamburg, this year’s triumphant national campaign). In 2018 he pushed his reluctant party to join yet another “grand coalition” as junior partner to Mrs Merkel’s Christian Democrats. He became her vice-chancellor and finance minister, a role that served as a sort of finishing school for the highest office he has now achieved.
Mr Scholz reads widely and surrounds himself with clever people. He has lately immersed himself in the work of Michael Sandel, an American theorist whose scepticism about meritocracy informs Mr Scholz’s emphasis on “respect”, by which he means a society that finds equal regard for rubbish collectors and CEOs. To give substance to that regard, he plans to increase the minimum wage by 25%, to €12 ($13.50) an hour. More importantly, Mr Scholz long ago imbibed the lesson offered by most previous SPD election-winners: that Germans are a cautious, centrist bunch wary of visionaries. Unloved by SPD members who wanted more red meat in their politics, Mr Scholz nonetheless almost single-handedly led the party to an unexpected election win on September 26th. If this narrow victory—less than 800,000 votes separated the SPD from Mrs Merkel’s conservatives—hardly represented a great renaissance of European social democracy, it did wonders for a party that had sat in the doldrums for years.
The pandemic played its role in Mr Scholz’s own recovery. He spent his first two years as finance minister disappointing those who had hoped a Social Democrat might end Germany’s excessive fiscal prudence. But when covid-19 struck Mr Scholz opened the taps, suspending Germany’s deficit-limiting “debt brake” to splash hundreds of billions on furlough and corporate-support schemes. He was instrumental in designing the EU’s €750bn ($890bn) recovery fund, forging a relationship with Emmanuel Macron that will prove crucial especially if the French president wins re-election next spring. Earlier this year he played an important part in pushing through an international corporate-tax deal, first at the G7 and then beyond.
Foreign and European policy will command much of Mr Scholz’s time. But his domestic ambitions will to a considerable extent be focused on climate protection. Managing the transition to a carbon-free future, he says, will be Germany’s biggest industrial test in a century. It will be a political challenge, too. The coalition deal commits Mr Scholz’s government to exacting targets, including an 80% share of renewables in electricity production by 2030, but is vague on how to finance the required investments. The two government departments charged with answering that question will be led by two self-assured men from different parties with very different ideas: Christian Lindner from the tax-cutting Free Democrats, who will be finance minister; and Robert Habeck from the Greens, who will run a beefed-up economy and climate ministry.
Managing clashes inside his coalition may well strain Mr Scholz’s celebrated skills of political mediation. So could soothing the inevitable frustration of the Greens, some of whom emerged disappointed from the coalition negotiations, as well as potential restiveness in the SPD’s own ranks. To manage disputes Mr Scholz will also rely on a handful of trusted aides. Chief among them is Wolfgang Schmidt, an ebullient figure whose reward for his decades-long service to Mr Scholz will be the job of running his chancellery; although some say Mr Scholz’s closest adviser is his wife, Britta Ernst, who serves as education minister in the eastern state of Brandenburg.
Like Mrs Merkel, who took office promising reforms but will be mainly remembered as Europe’s chief crisis manager, unexpected events will prove at least as testing for Mr Scholz as enacting his own government programme. He takes office amid a brutal fourth wave of covid-19, the uncertain threat of the Omicron variant and the prospect of renewed conflagration in Ukraine. An air of optimism surrounds his new government and its ambitions to modernise Germany. Olaf will das. But Germany’s new chancellor may not always get what he wants.