“Merchants of Hysteria”: The Case of Der Spiegel’s Gabor Steingart


Until quite recently, Chancellor Merkel’s calm, but efficient political professionalism was widely praised by the Anglo-American and German media. Now these same media circles are assailing her as dull, petty minded and ineffective in dealing with the financial-economic crisis. Of particular significance, in this media campaign is Der Spiegel’s correspondent in Washington, Gabor Steingart.
By Michael Liebig

One of Germany’s leading media figures is Gabor Steingart. He is not just writing articles in Der Spiegel, but is a prolific writer of books on political and economic affairs, and he often appears in Germany’s “trend-setting” political TV talk shows. Steingart says, he is no “looker-on”, for him journalism is political “agenda setting”.

There are some striking similarities between Steingart and the London Daily Telegraph’s economics editor, Ambrose Evans-Pritchard, who also served as that paper’s Washington correspondent. Both pursue a journalistic style of — reputably looking — hype. The methodology underlying the hype is “fallacy of composition”:

  • Select one or two aspects of the news picture, usually very real issues
  • Blow up these aspects out of any proportion
  • Then present these overblown aspects as the “total picture”
  • In doing so, use a narrative of absolute certainty

In 2001-07, before becoming correspondent in Washington, Steingart was Spiegel’s chief correspondent in Berlin. There, he became notorious for conducting a ruthless media campaign against the “red-green” government of then-Chancellor Gerhard Schroeder. Much is to be criticized in what Schroeder was doing, but let’s not forget that he kept Germany out of the Iraq War. And that earned Schroeder the status of political enemy for the Bush administration.

Germany’s “Downfall” in the “World War for Wealth”

Steingart did not criticize the Schroeder government’s social “reforms” nor its dismantling of financial market regulation. Quite the opposite, Steingart used Spiegel’s media clout to push these “reforms”, but for him they did not go far enough. In 2004, Steingart published, together with Spiegel’s then-chief editor, Stefan Aust, a book, titled: Germany – The Downfall of a Champion. The “message” of the book is simple: The paradigms of “social market economy” and the “social state” have ruined Germany. The cost of labour and social expenditures have become too high. A “cartel” of trade unions and sclerotic politicians has wrecked the German economy’s competitiveness in the age of globalization.

In 2006, Steingart published his next book: World War for Wealth – How Political and Economic Power is Redistributed. In it, he repeats his core message that the German “social market economy” model is outdated, self-destructive and will inevitably be buried by globalization. Germany’s fate is de-industrialization and proletarization. The rising “cheap labour” powers of Asia are gaining the upper hand in the “world war for wealth”. But right at the moment when the reader is ready to write off Germany for good, Steinhart offers a way out: “A NATO of the economy” to repulse the Asian onslaught. Germany has still a chance if it were to go for a “Transatlantic Free Trade Zone”.

Since, Steinhart has of course realized that George W. Bush is a “loser” who squandered America’s economic, financial and strategic capital. However, following this embarrassing failure, the election of Barack Obama has opened up new and grandiose perspectives. Please read what Gabor Steingart wrote on March 9, 2009 in SpiegelOnline (and please note that the following lines are not meant ironically):

American Orchids and German Weeds

“When Barack Obama speaks up on American TV, there is silence like in a church. The words of the President are perceived as an enrichment, not an annoyance. The people hear themselves speaking; one could say: the people speak to themselves. Obama is not merely doing politics, he explains what he is doing. For many [Americans], a world, increasingly seen as hostile, becomes comprehensible now. The financial crisis is combated with tons of money [by the Obama administration]; and the response to the fear of ruin through the crisis are the right words and the showing of compassion [by Obama].

Today, the world is looking towards America – and compares what it sees with the conditions back home […] No one can yet judge the content of Obama’s policies; he is in office only for seven weeks. But already today, his political style has become the new gold standard […] Politics with the people, democracy carried by compassion; whoever is not impressed by what’s happening [in America] is a cynic or a senior member of a German political party.

In the global village, the White House and the [German] Chancellor’s Office are not far away. It’s worth looking over the fence. It is as if our best friend has reinvented his life and leaves us behind with our old habits. In his living room, there is productive debate, in ours the TV is running. We see, how he lets in fresh air; we keep our windows closed. In his garden, orchids are blossoming; while in our garden common dandelion is growing”.

From Merkel down: All Dull and Grey

We see here that, if necessary, Gabor Steingart’s “agenda setting” journalism can even become lyrical. But we are also getting an uneasy sense that the political lyrics may just be the appetizer for rude polemics. Indeed:

Obama “is the worst that could happen to German politicians”, because “he shames them”, writes Steingart. The “legitimacy” of the Chancellor Merkel’s government is “shrinking faster than the stock indices”. Merkel is “showing off her decolletes more explicitly than her political convictions.” Merkel does not find the “right words”, but uses the “language of bureaucrats”. She cannot speak to the people, only about the people. No wonder, “everything looks so grey” in Germany.

Steingart gets really angry at Merkel, because she dared to say that, in spite of the current crisis, “our economy is strong, our products are internationally competitive, our social net is stable.” Does she not realize that “the crisis weakens the strong too,” he exclaims (five years after he had ascertained the “downfall” of the German economy).

If you think that Steingart, in view of the Bundestag elections in September 2009, might prefer the Socialdemocratic Vice-Chancellor to the Christian-democratic Chancellor, you are way off. No, the Socialdemocrats too are vague, vacillating and, moreover, they lack the will for power, writes Steingart. They don’t know whether they should be “the friend of the social climbers or the advocate of the fearful”? So forget the Socialdemocratic chancellor candidate Frank-Walter Steinmeier.

Then, Steingart goes a step further: The whole political system in Germany is defunct! Germany is a “party state”, characterized by compromise, shifting coalitions and “grey party hacks”. In Germany, the constitution allows merely “indirect democracy,” while in the United States, “the people rule American politics like God the universe”.

Steingart’s “Political Project”

Alas, after the “downfall” of the German economy in 2004, Steinhart now diagnoses the bankruptcy of the German political system, the constitution included. Please read carefully: “If there is currently a political project in Germany, it is not the reform of the party state, but overcoming it”. The way for overcoming the German “party state” is simple: Stay home and abstain from voting at the coming Bundestag election! Many people still have the illusion that voting for a political party will somehow strengthen democracy, writes Steingart, but “today, the opposite is true”: The political parties are no longer “part of the solution”. And, of course, Gabor Steingart, has his next book ready: The Question of Power – Views of a Non-Voter.

Rainer Burchardt reviewed Steingart’s new book in Deutschlandfunk. He noted that Steingart identifies many of of the defects in the political system and skillfully appeals to widespread dissatisfaction with non-transparent motions and compromises of political parties. But to advocate “mass voting abstention” as the solution, he concludes, is “strange”.

Strange, indeed. We can only speculate about the origins of Steingart’s latest political “agenda setting”. Let’s assume for a moment his “political project” would materialize: mass voting abstention at the Bundestag elections in September. What would be the consequence? Internal destabilization and the weakening of Germany’s international position in the midst of the financial-economic crisis. Cui Bono?

The Real Issues in the Crisis

Interestingly enough, Steingart, in his new book, with particular verve assails the Merkel government’s handling of the crisis: “In the financial crisis, Merkel distinguished herself by a nervous and erratic policy. One grows with challenges, is a popular saying. In her case, it’s the opposite. Merkel has shrunk.” Really?

Fact is that Merkel and her socialdemocratic Finance Minister Steinbrueck have refused to imitate the American ways of dealing with the crisis: Exploding state debt (currently standing at $11 trillion) to stimulate consumption, not innovative public/private investments; and turning the Federal Reserve into a giant “bad bank” for the “toxic assets” of private banks. To pay for the “toxic assets,” the Fed is literally printing money; and by the same method the Fed pays for US Treasury Bills which no one else is willing to buy. Over the past six months, the money printing amounts to $2 trillion.

Germany’s problems today derive from having imitated American financial and economic policies — before the crisis blew up. Had Germany stuck to the home-grown principles of “Rheinish capitalism”, its problems today would be much smaller. To assume that the same US establishment which caused the crisis, now possesses the supreme capacity for overcoming the crisis is not just naïve.

On March 14, Juergen Stark, the German member of directorate of the European Central Bank, made an interesting remark at the Tutzing Academy. Neither the causes nor the origins of the current crisis lay in continental Europe, he said, and called for a “continental European” approach in dealing with crisis. And that indeed is being done in continental Europe — which still has an industrial base and technologically innovative SMEs. That far too little is being done here in promoting state/private investments for basic innovations as the way out of crisis, is most regrettable, but it’s a different matter.

On March 16, the Czech Prime Minister Mirek Topolanek, who currently holds the rotating EU Presidency, gave in interview to the Frankfurter Allgemeine Zeitung. He said the EU countries must take a unified stance at the April 2 G-20 summit in London, otherwise the consequence will be that “the United States will solve their problems at the expense of the rest of the world”. Topolanek warned against those in the EU who say: “Obama is doing it, so we too have to do it.”

Topolanek surely didn’t think of Gabor Steingart when he gave the interview. But what he said, sums up Steingart’s message. Again, one wonders where this journalistic “message maker” is getting his message from?

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