Germany's diktat to Greece marks a dangerous deviation from its longstanding European policy. The deal forced through on July 13 by Angela Merkel did away with the country's traditional self-constraint, using her political and economic might to force a full-blown humiliation on a weaker partner. If hard-nosed over-assertiveness became Germany's new leitmotif, it would be toxic for Europe's future. But that's unlikely. German policymakers are well aware of the danger, and the Greek crisis is a very special case.
Merkel's brute force method was provoked by a misguided Greek government pursuing a questionable negotiation strategy. By rolling back civil service overhaul, slowing down privatisation and postponing reforms of the labour market and the pension system, Alexis Tsipras frittered away the trust in Greece's ability to change and undermined the basis for German financial support. Berlin has always been adamant that any help for stricken euro members is conditional on reforms. This is driven by Germany's fear of becoming the currency union's perennial paymaster. Since coming to power in late January, the Syriza-led government had done much to feed that angst.
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Conspiracy theories that Germany had wanted to chuck out Athens from the euro for a long time are nonsense. Wolfgang Schaeuble neither triggered Greece's early elections nor was responsible for Tsipras' illusory pledges up until the July referendum.
Still, Berlin overstepped the mark by making Grexit - thinly disguised as a "temporary" holiday from the euro - an official policy option. It then used this ultimate threat as a lever to pressure Greece into accepting a mortifying deal with terms even harsher than the bailout proposal voted down in the referendum. The perception that the country is becoming a European Union (EU) protectorate is only slightly over the top.
From Berlin's perspective, the shock-and-awe approach has worked. But this does not imply policymakers will use it blithely from now on, as it is at odds with the German commitment to European integration and the conviction that the EU's long-term survival hinges on consensus and compromise. Berlin's bullying will remain the exception rather than the rule.
