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All Eyes On Germany's Merkel In Ukraine Storm

<p>After weeks of behind-the-scenes diplomacy, analysts are starting to question whether or not Germany's cautious approach toward Putin is working.</p>

MAINZ, Germany – In the Western allies’ standoff with Russia over the Crimea crisis, Germany’s role has been described as that of the “good cop,” encouraging dialogue over harsh sanctions.

But Germany’s Angela Merkel denounced President Vladimir Putin on Sunday, saying that a planned Moscow-backed referendum on whether Crimea should join Russia was illegal and violated Ukraine's constitution.

After weeks of behind-the-scenes diplomacy, analysts are starting to question whether or not Merkel’s cautious approach toward Putin is working.

‘Back where we started’

Germany officials are clearly irked by the lack of progress in their efforts to get Russia to back down in Ukraine.

Following Sunday’s third phone conversation between Merkel and Putin within a week, German government officials described Putin’s position as “relentless.”

Germany’s new foreign minister, Frank-Walter Steinmeier, expressed frustration over the situation and admitted that after a week of negotiations with their Russian counterparts, all German efforts have failed so far.

“Essentially, we are back where we started at,” Steinmeier said in an interview Sunday with German television ZDF.

The lack of progress may force Merkel to adopt a tougher stance.

Speaking by telephone to Merkel and British Prime Minister David Cameron Sunday, Putin said steps taken by authorities in Crimea were "based on international law and aimed at guaranteeing the legitimate interests of the peninsula's population," the Kremlin said. But a German government statement responded that the referendum was illegal: "Holding it violates the Ukrainian constitution and international law."

Cautious – a lot at stake

Critics have portrayed the German approach as “weak” and believe that Merkel and her government should take a much tougher stance against Putin’s Russia.

But the cautious approach of Merkel’s government toward Russia is driven by fears of geopolitical consequences, a possible split of Europe, and ripple effects on the German economy.

Germany receives nearly 40 percent of its oil and gas imports from Russia. And, according to a German industry group, more than 6,000 German companies are active in Russia, totaling an investment of nearly $27 billion in the country.

"We feel a clear sense of unease and the fear that the crisis will worsen, bringing with it a spiral of sanctions which will have a massive impact on the economy," Eckhard Cordes, head of Germany's Committee on Eastern European Economic Relations, told Reuters, warning that 300,000 German jobs could be at stake.

But some analysts in Germany now believe that Merkel capabilities are possibly being overestimated.

“This crisis is a litmus test for Germany’s Russia policy and, in a way, also for Mrs. Merkel’s influence,” said Stefan Meister, an expert on Russian-German relations at the European Council of Foreign Affairs in Berlin.

‘Change through rapprochement’?

Experts also say that Germany’s stance toward Moscow is influenced by its long-standing Russia policy of “change through rapprochement,” the so-called “Ostpolitik,” or Eastern Policy, which Western Germany’s Social Democratic chancellors began promoting during Cold War times.

The policy is based on encouraging change in Russia through the expansion of dialogue and economic relations between the two countries.

“Many Social Democrats, including Gabriel and Steinmeier, still believe that a modern-day version of Ostpolitik offers the best approach for fostering change and democracy in Russia,” said Judy Dempsey, editor-in-chief of Strategic Europe at think tank Carnegie. She was referring to Sigmar Gabriel, Germany’s economic minister and vice chancellor.

Merkel at center of storm

But, observers believe that the solution to the crisis may be in the personage of Merkel as the de facto leader of the European Union, despite the fact that her relationship with Putin is not much more than cordial.

“Merkel is risk averse and she knows that Putin his highly unpredictable, so she does not know what the consequences might be,” said Dempsey, who is also author of a book on Merkel.

“Merkel has had a very, very difficult relationship with Putin ever since she took office in 2005,” Dempsey added.

She reportedly told Obama last week after a conversation with the Russian leader that she was not sure Putin was in touch with reality, but rather, “in another world.”

Even though Merkel and Putin share a common experience of Cold War times in former communist East Germany and speak each other’s languages, their experiences were very different and have colored their world view.

Merkel grew up in East Germany, once home to nearly 400,000 Soviet troops and Soviet intermediate-range missiles, while Putin was stationed as a KGB agent in the eastern city of Dresden during the 1980s. For Merkel, the end of the Cold War was a godsend that launched her political career; Putin has described the collapse of the Soviet Union as the biggest geopolitical catastrophe of the 20th century.

For both, the Cold War was a lesson in realpolitik which the world is seeing on display in their Ukraine negotiations.

High marks at home

Meantime, Merkel’s cautious stance seems to be going well with German voters.

Only 38 percent of those polled in a recent survey conducted by Infratest Dimap for ARD television favored economic sanctions against Russia, while 72 percent supported financial aid for the Ukrainian government.

Merkel must be doing something right, her approval rating recently rose by two points to 71 percent.