Germany Is Caught in the Middle of the Australian Submarine Saga

For all of her strengths as chancellor, Merkel leaves Germany in an awkward and increasingly precarious geopolitical position. Under her leadership, Berlin has walked a fine line between its postwar ally, the United States, and its top trading partner, China. The leading candidates to succeed her, Olaf Scholz of the Social Democrats and Armin Laschet of the conservative Christian Democrats, say they want to maintain this delicate balance.

The fallout from the Australian submarine deal underscores just how difficult this will be. Canberra’s decision to pull out of a lucrative contract with France to build a fleet of conventional submarines and to opt instead for a nuclear submarine deal and a broader defense pact with the United States and the United Kingdom has triggered a crisis in relations between Paris and Washington.

The leading candidates to succeed her, Olaf Scholz of the Social Democrats and Armin Laschet of the conservative Christian Democrats, say they want to maintain this delicate balance. The fallout from the Australian submarine deal underscores just how difficult this will be.

President Emmanuel Macron has recalled France’s ambassadors to the United States and Australia, and Foreign Minister Jean-Yves Le Drian has called the deal, which Paris learned about from senior U.S. officials only hours before it was announced, a “stab in the back.” Over the weekend, Le Drian described Biden’s foreign policy approach as “Trump without the tweets.” France is now pushing for a delay to the first meeting of the U.S.-EU Trade and Technology Council, scheduled to take place on September 29 in Pittsburgh. The council is seen as the primary channel for transatlantic coordination on challenges related to China.

Coming half a year before an election in which he will battle to win a second term, Australia’s about-face is a humiliating blow to Macron. France, with its network of overseas territories, is the only European nation with real skin in the Indo-Pacific game. It has been the driving force behind greater European engagement in the region—a campaign that culminated last week in the publication of a new EU Indo-Pacific strategy, inopportunely just as news of the submarine deal was breaking.

It is too early to say how much France’s fury will reverberate in Europe and in the transatlantic relationship, but several messages are clear. The first is that Washington’s pivot to Asia, first launched under Barack Obama in 2011, is accelerating under Biden at a pace that is taking European countries out of their comfort zone. The Australian deal was announced only weeks after the chaotic withdrawal of U.S. troops from Afghanistan, a step that shook European capitals but which Biden has defended as necessary, given his administration’s focus on the Indo-Pacific. If anyone in Europe doubted that China had become the organizing principle of U.S. foreign policy, they are now seeing proof that it is.

If anyone in Europe doubted that China had become the organizing principle of U.S. foreign policy, they are now seeing proof that it is.

Second, the deal shows that, although Biden is keen for Europe’s support in the competition with China, the officials in charge of his Indo-Pacific strategy do not see this as a top priority. In trying to explain the submarine deal, one senior U.S. official I spoke to pointed to a rush at the top levels of the National Security Council to deliver a big win for Biden after the embarrassment of Afghanistan. France was an afterthought as officials scrambled to get the deal done ahead of a meeting of Quad leaders on September 24. The defense pact with Australia and the United Kingdom, the senior U.S. official said, “is a good idea but the timing was a mistake. We were so focused on getting it over the line that we didn’t fully appreciate the implications for the French.”

There is also a message here for Germany and the candidates who are vying to replace Merkel. Since coming into office eight months ago, the Biden administration has invested a great deal of political capital in smoothing over strained relations with Berlin, halting Trump-era sanctions on the Nord Stream 2 pipeline, increasing troop levels in Germany that Trump had sought to cut, and rolling out the red carpet for Merkel during her farewell visit to the White House. Secretary of State Antony Blinken has declared that the United States has “no better friend” than Germany.

The same cannot be said for France. Macron has not visited Washington since Biden took office in January and it now seems unlikely that he will do so before France’s presidential election. He has made clear that he has no intention of joining the United States in a coalition against China. Macron is an advocate of European strategic autonomy with French characteristics—a Gaullist vision of a strong Europe, independent of the United States and China.

The submarine deal, and France’s fierce reaction to it, puts Germany in the awkward position of having to choose between its closest ally in Europe and a Biden administration that has worked overtime to lure Berlin into its orbit. The trauma of the Trump years convinced Germany to indulge France’s vision of strategic autonomy without ever fully endorsing it. Now, following the humiliation of the Australian submarine deal, Paris is doubling down on this vision, adding a new dimension to Berlin’s precarious balancing act. The silence of German officials in recent days has been telling.

Some officials in Berlin see a broader message for Germany coming out of the saga: the price of strategic ambiguity is rising.

Some officials in Berlin see a broader message for Germany coming out of the saga: the price of strategic ambiguity is rising. “What is happening to the French is what happens when you are strategically irrelevant,” a German defense official told me. “It can happen to us.”

How should Germany react? There are no easy answers. But refusing to acknowledge the strategic choices that the country now faces, as the leading German election candidates have done, is not a realistic long-term option.

On the campaign trail, Laschet and Scholz have been outspoken about what they do not want: economic decoupling, a new Cold War, and being forced to choose between Washington and Beijing. But they have not spelled out anything resembling a vision for Germany in a world where it will be increasingly torn between its closest political and economic partners.

The candidates are betting that Merkel-style ambiguity is what change-averse German voters want, and perhaps they are right. It is not an election winner to explain to voters that the two pillars of their country’s postwar prosperity—a rules-based, open trading system and the United States’ security guarantee for Europe—are beginning to show cracks. But once the election is out of the way, it will be important to have this long-delayed debate. The Australian submarine saga has made this clearer than ever.