A Panacea for all Times? The German Stability Culture as Strategic Political Resource

Abstract

The German Stability Culture is frequently pointed to in the literature as the source of the country's low inflationary policies and, at the European Union (EU) level, the design of Economic and Monetary Union (EMU). In Germany, the term was regularly wielded by central bankers and Christian Democrat (CDU-CSU) politicians to legitimise the move to EMU in the face of a large majority of public opinion opposed, and subsequent EU-level policy developments, particularly in the context of the eurozone debt crisis that erupted in 2009. An ordered probit analysis is used to demonstrate the depth of the German Stability Culture, showing that support for low inflation cuts across all party and ideological lines. Despite this ubiquity, the term has been wielded with regularity only by the centre-right Christian Democrats and is strongly associated with this party. A strategic constructivist analysis is employed to explain this uneven but persistent usage in German domestic politics.

Inflation Aversion in the European Union: Exploring the Myth of a North-South Divide

“…And yet -in more recent years -the preoccupation with inflation of the German population and a significant section of its political class appears comparatively distinctive, exaggerated and, it might be argued, extreme (see Howarth and Rommerskirchen 2013).…”

Joined at the hip, but pulling apart? Franco-German relations, the Eurozone crisis and the politics of austerity

“…So far, there have been only isolated instances of brief German flirtations with Keynesianism by Schiller under Brandt, and Lafontaine in the early days of the Schröder administration (Ryner, 2003). German 'stability culture' is an enduring and powerful ideational force (Howarth & Rommerskirchen 2013), and the consistency of the German position since 1979 should caution us from reading too much into the signs of corrosion. Indeed, so far predominant response to mass party corrosion has been the formation of 'Grand Coalitions' underpinned by an essential ordo-liberal consensus.…”

“…Ordo-liberalism informs a powerful 'stability culture' within German Politics, which shapes how German elites approach domestic and European economic policy issues (Howarth & Rommerskirchen 2013). Ordo-liberal strictures on macroeconomic policy favour fiscal conservatism and balanced budgets, and consider price stability as the public good that must be guaranteed (Dyson & Featherstone 1999: 20).…”

Die Deutschen und der Euro

“…Um Aussagen zum Verhältnis zwischen nationaler Identität und Euro treffen zu können, muss man die Bedeutung der D-Mark als wichtiges Symbol des deutschen Wirtschaftsaufschwungs nach dem Krieg und als Garant für niedrige Teuerungsraten für das deutsche Selbstverständnis berücksichtigen (Howarth und Rommerskirchen 2013). Daher könnte man vermuten, dass insbesondere in Deutschland eine starke nationale Identität mit einer Ablehnung des Euro und dem Wunsch nach einer Rückkehr zur D-Mark einhergeht.…”