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The chapter introduces the book conceptualisation of s framework for the causal analysis of welfare state reform. It introduces relevant actors and their interests in the two welfare states, institutional structures, as well as changing socio-economic contexts within which actors have operated since the late 1970s. Three sets of different institutional contexts are discussed: formal policy making structures, programme-specific features of unemployment and pension and family policy, and institutional complementarities linking social protection programmes to national political economy structures. The chapter concludes with a historical account of socio-economic trends in the two countries, covering about 25 years.

The chapter discusses three periods of policy change in the field of pension policy. It explains basic parameters of public pension systems and the scope of private provision, comparing contemporary systems with those which existed in the late 1970s. Using a number of indicators, it assess the scale and profile of change in each country. The different reform profiles are identified and their genesis discussed in the context of major legislative changes. It argues that the impact of policy legacies have played a major role in shaping policy profiles. The notion of ‘path dependence’ is a more instructive concept in pension than in unemployment or family policy, rendering radical policy change less likely in Germany than in the UK. However, changes in contextual conditions, not least due to German unification, have contributed to programmatic re-orientations and power relations within major political parties.

The incidence of environmental protest in Germany and Berlin is examined by means of an analysis of all the environmental protest events reported in die Tageszeitung during the years 1988–97. Although nationally reported protest declined in the early 1990s, it rebounded strongly in the mid‐1990s and became relatively more confrontational than previously. Strikingly, over half of all environmental protests were associated with nuclear energy, and the revival of protest is principally associated with the controversy over the transportation of nuclear waste. The broad picture of stability of protest over the decade is explained by the solid organizational infrastructure for protest provided by supposedly institutionalized environmental associations. German unification apart, the continuity of political structures and of environmental and nuclear policies during the decade also tended to produce continuity in the issues and incidence of protest.

The final chapter presents the way in which through a certain ‘intellectual’ asceticism the human person can reintegrate the fragmented humanity. Distinction, unification, wholeness, and deification are the keywords here. The power that enables this reintegration is the true love which is nothing else but God himself.

The East German case of transitional justice is unique in more ways than one: whereas in other Central and Eastern European countries dictatorships disappeared, in East Germany the country disappeared along with the dictatorship; where in other countries economic transition was precarious and often provoked the return of communist parties to power, in united Germany institutional stability and social safety were guaranteed by the fact that East Germany was absorbed into what was then one of Europe’s strongest economies and, arguably, most stable democracies. Thus, the ascendancy of a socialist successor party to national power was effectively impossible; moreover, where other countries felt their way towards an appropriate way of dealing with a difficult past, the West Germans had already been through a more or less successful experience with overcoming the past. After spring 1990, when the German Democratic Republic (DDR) revolutionaries negotiated a ‘transition by transaction’ with the old regime, the evolution towards democracy by ‘incorporation’ into West Germany was never at risk, and consequently old elites could be tried and purged; because of this ‘inner security’ and large financial resources, united Germany could also afford a vast and expensive bureaucracy to investigate the past thoroughly. At the same time, the complete incorporation of East Germany has produced unique problems, and policies to deal with the past were arguably contaminated by what many observers have seen as a sort of ‘colonialism in one country’. Achieving ‘inner unity’ between former East and West Germany was superimposed on the objectives of achieving justice and establishing secure foundations for democracy; thus, while many commentators have deemed the policy of openly dealing with the past a success, they have also claimed that the problem of the double division between East and West and within East Germany has probably been exacerbated by this very policy.

Presidential leadership is examined in the context of German unification. Particular attention is given to the construction of the French negotiating team and the domestic bureaucratic politics of EMU, especially involving Dumas, Guigou, Bérégovoy, and Trichet. Bérégovoy's idea of a third route to EMU is also considered. The key focus is on how French negotiators pursued their objectives, especially the idea of irreversibility.

Particular attention is paid to the legacies of Adenauer (on primacy to European unification) and Erhard (on the social market economy) and the problems of reconciling these two aspects of post‐war German tradition. The Ordo‐liberal concept of stability culture is identified as centrally important. The German negotiating style is characterized as rule‐based. Kohl is set in the context of German tradition.

Kohl's beliefs about EMU and governing style are examined, along with the policy ideas of Stoltenberg and the power of the Finance Ministry and of the Bundesbank over EMU. Particular attention is paid to attempts to fend off challenges to develop the EMS. Crucial to this account is the role of Genscher and then of Kohl in preparing the Hanover European Council and in sustaining the political initiative by binding in the Bundesbank through Pöhl's role in the Delors Committee. The role and impact of German unification was central to the reframing of EMU in 1989–90 and to Kohl's leadership role.

Germany was comparatively successful in weathering the macroeconomic crises of the 1970s and early 1980s, and its industrial sector remained highly competitive throughout. Nevertheless, unemployment has been high and is still rising. The impact of unification is only a part of the explanation. Instead, the very formula for Germany's past success is also the key to its current problems. Cooperative labour relations, on which German international competitiveness depends, were maintained by using the welfare state's generous exit options from the labour market for older and less productive workers. Given the prevailing mode of financing the “Bismarckian” welfare state, however, the resulting rise of social security contributions added to the costs of labour throughout the economy. As the government relied on the same solution in coping with the massive employment losses in East Germany after unification, non‐wage labour costs have risen to a level that can be sustained only by highly productive types of work. This constrains the growth of private services that have compensated industrial job losses in other countries.

The nationalism of concern here is collective action designed to render the boundaries of the nation congruent with those of its governance unit. Governance units are territorial units responsible for providing the bulk of collective goods to their members. Nations, for their part, are highly solitary, territorially concentrated, culturally distinctive groups. On the basis of these definitions, the chapter distinguishes between four analytically distinct types of nationalism: state‐building, peripheral, irredentist, and unification nationalisms.

A discussion of peripheral and unification nationalisms. Peripheral nationalism is directly spurred by the onset of direct rule: increasing political centralization threatens local leaders and provides an incentive for them to mobilize nationalist opposition to central authorities. Unification nationalism is a more indirect by‐product of direct rule. Since states adopting direct rule attain geopolitical advantages, the rulers of culturally homogeneous but politically divided territories have an incentive to merge their separate territories into a single political unit for defensive purposes.

This account of institutional change and positional differentiation of senior officials in Germany's Federal administration is presented in five sections. Section I, ‘Senior Officials and the Reassertion of Political Authority’, is introductory and discusses the causes and implications of change in the organization and in the political and administrative roles of the senior civil service; changes identified include party politicization, parliamentarization and federalization of the national policy process, modernization initiatives, European integration, and unification. Section II gives a brief survey of the Federal senior ministerial personnel (looking at pay grade and rank, and centrality), and section III considers paths to the top, paying particular attention to the procedures for recruitment and promotion and the consequences of weak formal structures for personnel planning and development. Following on from the definition of political craft as a defining attribute of effective top officials, section IV highlights the central position of political coordination units as training grounds in the Federal administration and comments on the informal positional differentiation that they encourage. The discussion concludes in section V with an assessment of the implications of the partition of the ministerial bureaucracy between Bonn and Berlin.

The 1949 (West) German Basic Law established a system of party‐based democracy that has now endured for more than half a century, yet today's political system is not identical to that of earlier years. Since the beginning of the 1980s, new party alternatives have made coalition politics harder to manage, the established parties have lost votes and members, and waning public support for all the parties has drawn unfavourab1e attention to the parties’ entrenched positions. These changes grew more pronounced in the 1990s, exacerbated, though not caused, by German unification, and developments reached a new stage in 1998, when one of the new parties of the 1980s, the Greens, became a party of government—an event made possible at least as much by the transformation of the Green Party itself as by a revolution in German politics. Nevertheless, despite the recent challenges to traditional political patterns, Germany remains very much a parties state, with parties still serving as the central mechanisms for political linkage and political decision‐making, and the same big parties being the principal players in state and federal coalition politics. The introductory sections discuss German parties and political institutions; the next three sections cover the same topics as the other country case studies in the book, and examine party legitimacy, party organizational strength (finance, staffing, members, mass media, parties in eastern Germany), and party functionality (in governance, interest articulation and aggregation, political participation, political recruitment and patronage, and political communication and education).

Charts the changes that occurred in American–Western European relations during the years of the Reagan and Bush administrations of 1984–1993, which marked a change in the Cold War (largely as a result of Gorbachev's policy changes in the Soviet Union), and its eventual end, which could be marked as the year 1989 (the year of the American–Soviet summit in Malta and of the collapse of Eastern European communist regimes). The first section of the chapter examines the Reagan and Gorbachev ‘Lovefest’: the change of Ronald Reagan's hardline anti‐Soviet policies to a policy of American–Soviet cooperation under the rule of Mikhail Gorbachev, and discusses Reagan's other foreign policies and Western European attitudes toward these. The second section, ‘The Liberation of Eastern Europe, the Unification of Germany, and the New World Order’, looks at the foreign policies of George Bush (who became President in January 1989) during this time of immense change in Europe, and at the increasing East–West cooperation that he presided over; the Gulf War strengthened American–European relations considerably during this period. The third section of the chapter shows that American–EU relations improved markedly under Bush, although the attitudes of the various European countries to a role for America in Europe varied, with the French being notably anti‐American. The last section of the chapter briefly considers the survival of the American–European relationship through this period and the changes that occurred in it.