German Policy Watch

September 6, 2012

Do Germans still support the euro? Lessons from the polls

• As the euro area faces another hot autumn of national reforms and institutional innovation at the European level foreigners often wonder whether German citizens and voters will simply say “No!” to further financial assistance and deeper political integration. So far, this has not been the case.
• Recent polls by various institutes indicate that relatively speaking, Germans remain the staunchest supporters of European integration in general and rank with the most positive in international comparison amongst those polled. Yet, their overall support levels for the euro in general and the ECB in particular do not show solid majorities. Moreover, opinions are clearly influenced by a benign domestic economic environment, too, and are therefore subject to reversal risks.
• Germans firmly support their politicians as regards the general handling of the crisis but are worried about the economic outlook, the depth of the financial commitments undertaken already and Germany’s ability to manage the crisis. Majorities are still in favour of stabilising the crisis-afflicted countries, with the exception of Greece, and optimistic about an eventual resolution of the crisis. Further attempts at political integration do not receive high support levels.
• While serious constraints from public opinion on electoral fortunes in September 2013 are not yet evident for most of the issues at stake this autumn, German public opinion emerges as a latent constraint on more forward-looking action to build a stable monetary union. Saving most of crisis-ridden Europe still seems to be a controversial task but politically manageable, but managing Greece will be a controversial uphill battle.

Foreigners often think that German citizens are likely to lose patience with their partner countries in the euro area, reject rescue measures, prefer to return to their once beloved D-Mark and by themselves represent the biggest risk to the stabilization of the euro area. We have been arguing for a while that this perception is too simple a view of a more complex picture. Germans have been, and still are, largely supportive of current government policies, with one notable exception: policy towards Greece.

Putting EMU on a much sounder platform by adding to the toolbox of national structural reforms, fiscal adjustment and enhanced euro area oversight via the “four unions” - namely financial market, fiscal, economic and political union - is not yet endorsed by a majority. Given the fact that all this is pretty new music that has not been described, explained and debated a lot in the media, there is clearly a challenge of marshalling support for those objectives.

More specifically, recent polls indicate the following state of play on German public opinion on the euro issue:

• Polled by the Pew Research Center’s Global Attitudes Project in May 2012, Germans proved to remain the staunchest supporters of European integration among eight EU member states included in the poll (Czech Republic, France, Germany, Greece, Italy, Poland, Spain and UK), with 68% in favour (median: 60%). In contrast, support declined by 20 percentage points over a few years in Italy and Spain to some 60% in May. 59% of Germans polled consider Europe good for German economic performance, a minority thinks the same of the euro (40%), and the ECB is held in good esteem by only 40% – the latter being a lower value than in either France or Poland. 74% of Germans polled think that banks and the government are to blame for the recent financial crisis which is a pretty high level in comparison. However, concerns about unemployment, fiscal problems and inflation are clearly below levels in other countries and in line with economic realities. As in most other countries, a majority opposes more austerity and strengthened EU oversight of national budgets. Opinions are divided on financial assistance to other euro area countries (49% in favour, 48% against). Support from the political left is slightly higher than from the right (56% to 46%). 80% of respondents (only Germans) supported Chancellor Merkel’s handling of the euro crisis, the best result for any national leader in the questionnaire. However, only 27% have a favourable view of Greece.
• Polled by Infratest Dimap at end July for the monthly ARD Deutschlandtrend, a majority of Germans consider the current economic situation as good (57%) or very good (6%). The positive judgement reached a low in May 2009 at roughly 10%, but moved above 50% in November 2010 and has stayed at high levels ever since. There is clearly no sense of gloom in Germany now but 56% think the economic situation will take a turn for the worse over the next twelve months. On the euro issues, since early 2010 a vast majority has held the view that the peak of the crisis is still to come (84% in July) and feared a severe impact on the German economy from a potential break-up of the euro area (76%). However, Germans have positive views of meeting the challenge and fixing the euro area (64%). Chancellor Merkel’s handling of the crisis is judged positive by 59%   much more than the government’s policy in general (45%)    and a majority thinks the euro should be preserved. 51%, however, think it was a mistake to begin with EMU in the first place. On central bank policy, 39% think the ECB should stick to a narrow mandate on price stability only, whereas 45% do not feel competent to answer the question. Only 12% explicitly support bond market intervention. Strong majorities favour Ireland, Italy, Spain and Portugal as euro countries whereas only 31% favour Greece to stay in EMU. Angela Merkel and Wolfgang Schäuble are the top two German politicians in this poll, with 68% of Germans lauding Chancellor Merkel’s performance.
• Asked by Allensbach pollsters about the role of the Constitutional Court, Germans support the constitutional review of the European Stability Mechanism by a wide margin (68% in favour) and a strong role of the Court in all legislation on crisis management in general. In addition, those who consider the Basic Law as being at issue have risen significantly in numbers (some 41% now). Significant majorities feel uneasy about the euro crisis, the rescue measures and attempts to deepen European integration with fiscal and economic union.

References:

ARD Deutschlandtrend. August 2012. ARD.
Renate Köcher (Allensbach Institut) (2012). Das Bollwerk. Frankfurter Allgemeine Zeitung. August 22.
Pew Research Center. Global Attitudes Project (2012). European Unity at the Rocks. Germany and Greece at Polar Opposites. Washington, D.C.. May 29.

Author:
Klaus Deutsch +49 30 3407 3682, klaus.deutsch@db.com