Elections in Germany: it’s the intellectuals, stupid!

Germany’s federal election yesterday resulted in a stable majority for a "black-yellow" coalition of Conservatives (CDU) and Liberals (FDP). Is this the starting shot of a free-market reform programme in Europe’s largest economy?

Probably not. Remember the last federal election, in 2005? In the months prior to Election Day, it all looked like a done deal. Opposition leader Angela Merkel would win a landslide victory and become a continental Margaret Thatcher. In her four years in office, if anything, she has been more of a continental Edward Heath. How did this happen?

In 2005, the CDU led all the polls by huge margins – not because of, but in spite of its platform, which, by German standards, was daringly reform-minded. Voters were so fed up with Gerhard Schröder’s red-green coalition that Merkel could have proposed a ban on football and beer and would still have become federal chancellor. But when she appointed Professor Paul Kirchhof, a known supporter of the flat tax and of private pension provision, as shadow finance minister, this last straw broke the camel’s back.

Social Democrats (SPD), Greens and Socialists set a shrill campaign in motion, surfing on popular fears of "neoliberalism" and "Anglo-Saxon capitalism". But this was not surprising. After all, this was the height of an election campaign, and for his opponents, Kirchhof was godsend. However, in Merkel’s own CDU and even in the FDP, more and more whistle-blowers craved for a slice of public approval and attacked Kirchhof. The CDU’s poll ratings deteriorated fast, and on Election Day the party came out so low that it was forced into a "grand coalition" with the SPD.

Merkel had learned her lesson: Never ever try free-market reforms on the German electorate again. In the coming four years, Merkel proved her zeitgeist -adaptability, concentrating on green policies, free childcare, and benefit increases. The nation’s standing in the Economic Freedom of the World list dropped from a mediocre 17th to an embarrassing 27th rank.    

To readers familiar with Hayek’s The Intellectuals and Socialism , none of this will be surprising. As long as sixty years ago, Hayek convincingly explained that what matters is not the political personnel of the day, but the broader climate of ideas, which is ultimately driven by a nation’s intellectuals. As Hayek put it,

"once the more active part of the intellectuals has been converted to a set of beliefs, the process by which these become generally accepted is almost automatic and irresistible."

Keeping Hayek’s words in mind, note how SPIEGEL journalist Jan Fleischhauer describes Germany’s intellectual landscape:  

"I am part of a generation in Germany that knows no other reality than the dominance of the left. [...] Go to any theatre, museum or open-air concert, and you’ll quickly realize that ideas beyond the mindscape of the left are unwelcome there. A contemporary play that doesn’t critically settle scores with the market economy? Unthinkable. [...] In the business of opinions, where I earn my money, there is practically nothing but leftists."

Then notice how Dirk Maxeiner and Michael Miersch , two famous journalists and book authors, describe mainstream thinking:

"In the late 1970s, the Greens succeeded in merging [...] anti-capitalist ideology and conservative opposition to progress [...] Today, all parties are green; this attitude has taken over nearly the entire society. No technological innovation has been welcomed in Germany since the colour television ."

 

Any opinion survey confirms these descriptions. Has there ever been a more effective proof of Hayek’s theory?

The incoming black-yellow coalition deserves the benefit of the doubt, and it will certainly represent an improvement over the standstill coalition of the past four years. But if a genuine market-oriented reform agenda was put into place, it would, in the Hayekian framework, represent a short-cut. Politicians would consistently have to go against the grain of a nation’s intellectuals and the general zeitgeist . Are you aware of any historical example where this has ever happened? Me neither.

Kris makes a good argument, until his last point. I would argue that Mrs Thatcher in 1979 is an example of a politician going against the intellectual consensus, and using an alternative set of intellectuals, including Hayek himself, to provide support. What this shows is that dominant ideas often appear so strong because no one challenges them. Once they are challenged, however, as Mrs Thatcher did, they quickly fall away. The reason for this is that, unfortunately or otherwise, intellectuals are much less influential that they think they are.

Peter – A counter-argument would be that Thatcherism was unsustainable precisely because it failed to convert the intellectual establishment (whose members rely on state privileges). Key areas of policy were more or less impervious to reform, including health and education. And Thatcherism quickly lost momentum and the level of government intervention began expanding rapidly once John Major became prime minister.

The influence of intellectuals depends on their social standing and also their ideas have to resonate in the general population. Not every idea spouted by intellectuals is immediately embraced by the public.Once ideas become entrenched it is very hard to remove them. One must first convert a large enough segment of the intellectuals themselves or, if that fails, to demonize them.Also, not all intellectuals are lunatic leftists. The U.S. has a healthy tradition of conservative, free market intellectualism which is immensely influential.Perhaps the question is the essential craving for freedom in the population. Seemingly, Germans lack such an ideal. Hardly surprising, though, is it?

Richard, I worry about the use of the term ’sustainable’ here? Just because Thatcherism didn’t last forever does not mean it failed or had no intellectual influence. Indeed a lot of its influence was how it changed the behaviour and thinking of left-wing intellectuals. My point remains, however, that ideas are often stimulated by policy and political direction and not the other way round, and this might offer hope to liberals and conservatives in Germany, just as a conservative victory in the UK in 2010 will lead to a resurgence of right-wing thought and thinkers. This is not because they are saying anything different, just that people are now prepared to listen.

Also, we should remember that Hayek wrote the texts that influenced Thatcherism in the late 50s and early 60s, so we should look at the intellectual tradition as much as the what is currently happening. By the number of name checks he’s started getting watch out for a renewed interest in Michael Oakeshott’s work from the early 1960s over the next couple of years.

It is worth remembering some things about the Thatcher government.Privatisation of particular state monopolies was often unpopular ex ante, and the government itself was pretty tentative about it. Nobody had really expected foreign exchange controls to be abolished; but not many people now advocate them.And it was ‘unthinkable’ to slash the top marginal rates of income tax, which had been around 90 per cent for forty years. Yet nobody — not even Gordon Brown — suggests reintroducing that sort of top rate.It wasn’t all down to Thatcher herself: but what she did certainly made a big difference, and, in general, much of it has lasted.

I don’t think Hayek was saying that ideas have to be 100% mainstream before anything happens, but surely, ideas must have some base of active intellectual support before they can become policy. I don’t know enough about the UK’s intellectual climate in the 80s, but if free-market thinking had been totally alien here, then a typical Thatcher speech would simply not have made sense to anyone. Translate a Thatcher speech into German, French or Swedish, and try it on a random German, French or Swedish audience. You will get bewildered, irritated comments of the type that Anthony Evans got on his Guardian article: http://www.guardian.co.uk/commentisfree/2009/sep/14/banking-recession-re...

Kris, there is no shortage of free-market thinking in the UK and there never has been. What matters is the climate in which it exists and so whether it gets listened to. Mrs Thatcher – and the failure of Labour in the 1970s – helped to alter the climate and so Hayek and others could be heard. Intellectuals have much less influence than they think they have. Their main impact is on other intellectuals.

Peter,
I don’t agree. There are enough more recent developments that fit very well with Hayek’s interpretation of intellectuals as catalysts. Environmentalism and anti-globalisationism have started as playgrounds of intellectuals, and have since spread to wider circles.
When I went to primary school (1980s, West Germany), one of the first things I learned was that the planet was about to collapse, unless we drastically alter our lifestyles. In the 1980s, that was a common attitude among teachers and journalists, but the average Joe cared little about it. Today, the average Joe will tell you exactly the same thing.

Perhaps part of the problem is how intellectuals are defined. Do they just comprise academics, or should we include wider groups such as journalists, thoughtful politicians and teachers?

OK I should have added: I was using the term ‘intellectuals’ in the (very broad) Hayekian sense.

Kris, when I was at school in the early 1970s I remember being told with some certainty that oil would run out by 1980 and that the world was cooling towards a new ice age. In the case of global warming and climate change I would argue that this now appears normal not because of intellectuals but because of the impact of politicians and policy makers, backed up by the media.Perhaps we don’t need a debate on what is an intellectual, but I would define one as someone who speaks authoritatively in public outside of their area of competence. Hence Chomsky can be called an intellectual because of his political statements not because of his work on linguistics.

Kris makes a good argument, until his last point. I would argue that Mrs Thatcher in 1979 is an example of a politician going against the intellectual consensus, and using an alternative set of intellectuals, including Hayek himself, to provide support. What this shows is that dominant ideas often appear so strong because no one challenges them. Once they are challenged, however, as Mrs Thatcher did, they quickly fall away. The reason for this is that, unfortunately or otherwise, intellectuals are much less influential that they think they are.

Peter – A counter-argument would be that Thatcherism was unsustainable precisely because it failed to convert the intellectual establishment (whose members rely on state privileges). Key areas of policy were more or less impervious to reform, including health and education. And Thatcherism quickly lost momentum and the level of government intervention began expanding rapidly once John Major became prime minister.

The influence of intellectuals depends on their social standing and also their ideas have to resonate in the general population. Not every idea spouted by intellectuals is immediately embraced by the public.Once ideas become entrenched it is very hard to remove them. One must first convert a large enough segment of the intellectuals themselves or, if that fails, to demonize them.Also, not all intellectuals are lunatic leftists. The U.S. has a healthy tradition of conservative, free market intellectualism which is immensely influential.Perhaps the question is the essential craving for freedom in the population. Seemingly, Germans lack such an ideal. Hardly surprising, though, is it?

Richard, I worry about the use of the term ’sustainable’ here? Just because Thatcherism didn’t last forever does not mean it failed or had no intellectual influence. Indeed a lot of its influence was how it changed the behaviour and thinking of left-wing intellectuals. My point remains, however, that ideas are often stimulated by policy and political direction and not the other way round, and this might offer hope to liberals and conservatives in Germany, just as a conservative victory in the UK in 2010 will lead to a resurgence of right-wing thought and thinkers. This is not because they are saying anything different, just that people are now prepared to listen.

Also, we should remember that Hayek wrote the texts that influenced Thatcherism in the late 50s and early 60s, so we should look at the intellectual tradition as much as the what is currently happening. By the number of name checks he’s started getting watch out for a renewed interest in Michael Oakeshott’s work from the early 1960s over the next couple of years.

It is worth remembering some things about the Thatcher government.Privatisation of particular state monopolies was often unpopular ex ante, and the government itself was pretty tentative about it. Nobody had really expected foreign exchange controls to be abolished; but not many people now advocate them.And it was ‘unthinkable’ to slash the top marginal rates of income tax, which had been around 90 per cent for forty years. Yet nobody — not even Gordon Brown — suggests reintroducing that sort of top rate.It wasn’t all down to Thatcher herself: but what she did certainly made a big difference, and, in general, much of it has lasted.

I don’t think Hayek was saying that ideas have to be 100% mainstream before anything happens, but surely, ideas must have some base of active intellectual support before they can become policy. I don’t know enough about the UK’s intellectual climate in the 80s, but if free-market thinking had been totally alien here, then a typical Thatcher speech would simply not have made sense to anyone. Translate a Thatcher speech into German, French or Swedish, and try it on a random German, French or Swedish audience. You will get bewildered, irritated comments of the type that Anthony Evans got on his Guardian article: http://www.guardian.co.uk/commentisfree/2009/sep/14/banking-recession-re...

Kris, there is no shortage of free-market thinking in the UK and there never has been. What matters is the climate in which it exists and so whether it gets listened to. Mrs Thatcher – and the failure of Labour in the 1970s – helped to alter the climate and so Hayek and others could be heard. Intellectuals have much less influence than they think they have. Their main impact is on other intellectuals.

Peter,
I don’t agree. There are enough more recent developments that fit very well with Hayek’s interpretation of intellectuals as catalysts. Environmentalism and anti-globalisationism have started as playgrounds of intellectuals, and have since spread to wider circles.
When I went to primary school (1980s, West Germany), one of the first things I learned was that the planet was about to collapse, unless we drastically alter our lifestyles. In the 1980s, that was a common attitude among teachers and journalists, but the average Joe cared little about it. Today, the average Joe will tell you exactly the same thing.

Perhaps part of the problem is how intellectuals are defined. Do they just comprise academics, or should we include wider groups such as journalists, thoughtful politicians and teachers?

OK I should have added: I was using the term ‘intellectuals’ in the (very broad) Hayekian sense.

Kris, when I was at school in the early 1970s I remember being told with some certainty that oil would run out by 1980 and that the world was cooling towards a new ice age. In the case of global warming and climate change I would argue that this now appears normal not because of intellectuals but because of the impact of politicians and policy makers, backed up by the media.Perhaps we don’t need a debate on what is an intellectual, but I would define one as someone who speaks authoritatively in public outside of their area of competence. Hence Chomsky can be called an intellectual because of his political statements not because of his work on linguistics.

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