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Is Olaf Melting?



Ben Otto

An embattled Chancellors’ coalition is starting to crumble.

Get it? Because of the snowman? Nevermind. 

As Olaf Scholz spoke before the Bundestag, the German Parliament, on an unusually warm February day in early 2022, the weather was not at all indicative of the mood among the almost 900 Representatives he would address. 

An eerie silence filled the hall as the head of the German nation-state began to speak. 

Just three days prior, in the early hours of the morning, Vladimir Putin had illegally marched hundreds of thousands of troops into independent Ukraine, uprooting international norms, breathing new life into seemingly ancient alliances like NATO – and coaxing Soviet hawks out of hibernation.

The Chancellor spoke in an uncharacteristically moving speech of a “Zeitenwende”, a new age and reshuffling of rules previously set in stone. All parties represented in parliament, bar the alt-right AfD and the alt-left “Die Linke”, both with worryingly close ties to the Kremlin, supported a complete overhaul of the mothballed Army, arms shipments, and humanitarian aid (the Luftwaffe flies wounded Ukrainians to top Hospitals in Germany in an astonishing role-reversal).

Such a large consensus is rare in German Politics and shows the power that the Chancellor had to unify across the political spectrum. 

But one year on from his famous “Zeitenwende” speech, Scholz seems to be losing control of his government, as the war in Europe has become normality while infighting takes over his coalition.

Mission: Coalition

Coalition governments with multiple parties in power are the norm in Germany, and it is incredibly rare for any one party to achieve a majority – most Germans don’t remember the last time that happened too fondly (I wonder why?). 

The largest representative in the current government is Scholz's Social Democratic Party (SPD) with only 25% of the vote, while the Liberal Party (FDP) and Greens are the two junior coalition partners.

Recently the coalition has been engulfed in conflict about a form of Universal Basic Income for families with children, the pivot to renewable energy (the FDP coined legislation limiting the use of gas and oil a “heating ban”) and shipments of more advanced weaponry, like the advanced “Leopard II” Tanks to Ukraine.

This kind of bickering is normal in a coalition as parties try to smash their ideologies into law and attempt to strengthen their image ahead of state and local elections. 

What is unusual about this batch of slightly contrived infighting, however, is the remarkable absence of Scholz, who is the Chancellor and head of government, to mediate between the parties and attempt to negotiate a consensus.

Is Scholz unfit for office?

The Chancellor has travelled a bumpy road to reach office, as public scrutiny over alleged corruption he took part in during his time as mayor of Hamburg (yes, real city) ramps up a continuing investigation. During his term, Scholz allegedly helped cover up the crimes of a bank that illegally stole hundreds of millions of Euros (about fifty billion rupees) from the state.

During so-called “cum-ex”- scams, very basically, stocks in companies were bought with (cum) and without (ex) dividends. They were then traded between multiple institutions in on the scam, allowing them to make a profit by abusing a loophole (according to the banks) in tax law.

In 2016, after the cum-ex scandals had come to the public's attention, Hamburg's Ministry of Finance opened an investigation into one of the Cities banks to find out how much money needed to be paid back and, for a long time, it looked as if the ministry would uncover shocking evidence. 

Suddenly, in November 2016, the ministry stopped investigating because of “legal risks”.

Complete radio silence ensued, and the matter began slowly disappearing into this Everest-sized hole of a banking scandal.

Then, out of the blue, during an unrelated investigation, the diaries of the Banks’ CEO, Christian Olearius were recovered. In them, Olearius writes that influential SPD politicians as well as Hamburg's Minister of the Interior pledged to help him and his bank after the scandal came to light - and that he met Olaf Scholz during several undeclared meetings. 

Liar, Liar, Pants on Fire

The News kicked into a frenzy as they connected the dots between the meetings Scholz had and the sudden disappearance of the tax fraud investigation. Questioned by investigators and the public Scholz stated he had “simply forgotten” the contents of their meetings.

Happens to the best of us, I suppose. 

Olearius Diaries’, though, claim that cum-ex was extensively discussed during their convergence in the shady backrooms of Hamburg. Is it too far-fetched to claim the Chancellor abused his political influence to shield a bank from scrutiny? 

500 Million Euros is a lot of money and some (rightly) question what Scholz received in return for protecting Olearius and his colleagues. If your columnist had to abuse his (vast) political influence, he would not do it for free.

The affair is complicated by the fact that no evidence incriminates Scholz. He publicly denies any wrongdoing, and in a democracy, rumours and forgotten meetings are not enough to put you in prison.

Scholz still managed to win the 2021 Election, mainly due to utter incompetence from the main opposition party, the CDU. Many Germans were then not aware of the full extent of the cum-ex dealings, or Scholzs’ alleged role in covering them up. 

But they are now waking up to the fact that he may be plainly corrupt, and his current approval rating of around 30% reflects that.

Wartime Woes

The once-unifying chancellor is also alienating his voters as his party has not been able to keep key election promises because of the war in Ukraine. Many Germans are growing tired of his vague and sometimes false statements about weapons shipments– as an example, the Chancellor repeatedly assured the public no tanks would be sent to the country, then said YOLO and did it anyway.

Though your columnist thinks that sending tanks to help Ukrainians defend themselves against a brutal warmonger is an admirable act, he must concede that, like many of his fellow citizens, it is at the very least disingenuous to repeatedly deny something and then do just that.

Considering this, it shouldn’t be surprising that many are beginning to question his ability to govern amid this corruption scandal and his seeming inability to keep electoral promises. 

The coalition seems to continually strain each day that passes by – pundits ask if the coalition will manage to hold out until the next election in 2025. 

If it’s any consolation, at least we’re doing better than the Brits. 

The Future

It is too early to say if the fragile coalition will prevail over soaring inflation and consistent infighting, but one thing is clear - Scholz needs to do better. 

The consensus in Germany seems to be that the Chancellor is at best incapable of diplomacy in his coalition, or at worst corrupt in ways we might not know about. But after a period of consistent stability and economic growth, it is safe to say that Scholz has woken up Germans to a reality wherein the world is not pandering to the West any longer.

What is Deutschland’s future? Only time will tell. 

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