Printing is one of the world's oldest industries, and typography is one of the oldest occupations in the industrial economy. Typographers essentially transformed stacks of typed and handwritten manuscripts into a form that permitted the mass production of books, newspapers, and journals. Half technicians and half craftsmen, typographers were highly skilled, well paid, and proud harbingers of Gutenberg's revolutionary invention. However, the craft was radically transformed over time: first from “hot-metal” typesetting to “analog” typesetting and then to digital CRT (cathode ray tube) and laser image-setting. In the process of change, previous typesetting skills were swept aside in a matter of a decade or two, and large numbers of typesetters and other printing production workers lost their jobs – many by an invention that the printed word helped set in motion: the computer. Lead molds, printing plates, and all the other paraphernalia that went into the original printing processes were retired to the dusty shelves of industry museums. But retirement was not an option for the majority of typographers whose livelihood depended on using the skills they had acquired through long apprenticeships and years of learning by doing.

The depth of desperation these workers felt as their industry was transformed – manifested in bitter strikes across the developed world – can be loosely conceptualized as a product of the nontransferability of their skills and the speed with which their skills were rendered obsolete by new technology minus the availability of public policies such as unemployment insurance, public health insurance, pensions, retraining programs, and public job creation that all cushion the effects of skill redundancy.

Can being governed by a state that is not fully sovereign be anything other than a crippling disadvantage for a country? In his seminal analysis of post-war West Germany, Peter Katzenstein suggests it can. Indeed he argues that precisely not having command of full state capacities afforded West Germany more effective governance than comparable countries. This was because semisovereignty, according to Katzenstein, protected the West German state from counterproductive illusions of omnipotence other states at the time still held, and forced it to cultivate means of public policy other than direct state control – means much better matched than traditional state intervention to the evolving problems of governance in a changing world.

Successful semisovereign governance, in Katzenstein's sense, rests on two pillars. First, a fragmented, decentralised state whose capacities for direct intervention are limited must learn to make deals with independent actors in civil society which command their own sort of sovereignty which cannot be ignored or circumvented. A state of this sort must, therefore, be a ‘co-operative state’ (Wilke 1983), one that governs more by negotiation and co-optation than by legal command (Scharpf 1993). Where this works – in a political system that has learned to build a culture and develop techniques of indirect control – independent social organisations and institutions with their guaranteed autonomy and power turn into agents of publicly licensed self-government, under the roof of a negotiated public order of which the state is just one element among others, although a pivotal one (Streeck and Schmitter 1984).

Political parties, as Strøm (2000, p. 180) maintains, are generally ‘the most important organisations in modern politics’. Along with co-operative federalism and parapublic institutions they constitute one of the three crucial ‘nodes’ of the ‘semisovereign model of governance’ Katzenstein (1987) developed to analyse patterns of policy-making in the Federal Republic of Germany. Not only do parties in this model serve as links between citizens and elected officials at the regime level (cf. Poguntke2002; more generally Müller 2000), they also connect the various tiers, arenas and corporate actors in the Federal Republic's decentralised state contributing to a peculiar mix of competitive and co-operative elements (cf. Holtmann 2000; Leonardy 2001; Renzsch 2000). As for political parties, this model is generally characterised by ‘the conjoining of the party-run state with statist parties’ (Katzenstein 1987, p. 377) and, more specifically, by a number of structural attributes that he believes to have profoundly influenced the formulation of centrist policies, which tend to be adjusted incrementally and largely irrespective of the party-political composition of the federal government of the day (Katzenstein 1987, p. 39).

This chapter seeks to map and analyse continuities and change of relevant structural attributes of the German party system at all three levels conventionally emphasised in the literature: (1) party in public office, (2) party as organisation and (3) party in the electorate, following the triad famously suggested by Key (1964).

The Semisovereign Model of Governance

In political science, every once in a while, a book is published which redefines the way scholars think about a social phenomenon, a policy, a concept or an institution. It is, however, particularly rare for a book on the politics of a single country to have a similar impact: it is notoriously difficult to capture adequately the links between institutions, history, cultural environment and policy outcomes at the same time. More importantly, it is even more unusual for such a book to be accepted by the indigenous community of political scientists as one of the definitive accounts of that country.

Peter Katzenstein's 1987 book, Policy and Politics in West Germany: the Growth of the Semisovereign State, is just such a contribution. Conceived of as an illustration of the limits of domestic state power, it locates institutional structures and policy outcomes in the Federal Republic of Germany (or West Germany before 1990) within the country's specific historical and societal context. Its central argument is that policy in West Germany was defined by ‘incremental outcomes’, a pattern which, moreover, remained broadly constant across changes of government. This stood in direct contrast, for instance, to the much more dramatic changes introduced by Margaret Thatcher after the Conservatives came to power in the UK in 1979. The tendency towards incremental outcomes, so the argument continued, was conditioned by the ‘semisovereign’ structure of the state, which sees decentralised state institutions pitted, often individually, against strong centralised societal organisations.

Weak State, Incremental Bias: Semisovereignty in Comparative and Historical Context

Occasionally a book so successfully defines the central characteristics of a political system that it comes to inform the core assumptions, basic interpretations and agenda pursued in later studies. This applies with particular force to what are seen as its distinctive biases in economic policy management. It was Peter Katzenstein's (1987) seminal achievement to offer such an account of economic policy management in West Germany. Katzenstein's narrative was born out of a very different historical, institutional and ideational context from that of other countries such as France. The post-war reconstruction of West German economic policy was haunted by memories of the economic, social and political breakdown caused by hyperinflation in the 1920s and 1940s, by memories of the misuse of economic power by large firms and cartels, and by their association with the collapse into the barbarism of the Nazi period. Against this background, ‘economic stability’, the competitive market economy and ‘social partnership’ took on a deeply symbolic as well as practical value as guarantors of post-war liberal democratic stability. They decentralised and shared economic power (notably through competition policy and through co-determination in corporate governance), and put in place an institutional framework that was designed to prevent irresponsible political management of monetary and financial policy (in particular an independent central bank).

Introduction

The weakness of the (West) German ‘semisovereign state’ that Peter Katzenstein diagnosed in his book in 1987 was, according to his argument, not as insurmountable a disadvantage as one might have assumed. Quite the contrary: the profile of policy outcomes seemed to suggest that not having an almighty state could actually be an advantage. But the reason for these positive outcomes was not the state's weakness alone; it was the peculiar combination of a ‘decentralised state’ with a ‘centralised society’ that proved advantageous. It also helped to explain the central puzzle that West Germany presented when compared with similar cases of highly industrialised liberal democracies, namely the tendency towards only incremental policy change and the high degree of policy stability even after changes of government (Katzenstein 1987, pp. 4, 35).

Katzenstein argues that the ‘decentralised state’ and the ‘centralised society’ interact primarily through three ‘nodes’ in the policy network, namely political parties, co-operative federalism and parapublic institutions. In this chapter, the focus will be on the latter – and the question whether (and if so, how) their function in the German political system has changed. For the period since Katzenstein developed his hypotheses about (West) German politics in the mid-1980s has seen momentous changes in the history of the country. Above all German unification, but also further steps in European integration, certainly make it worthwhile to ask how far these developments have affected the ‘parapublic institutions’ that Katzenstein has portrayed as a vital ingredient of German politics.

Introduction

In the context of immigration policy, Peter Katzenstein's (1987, pp. 209–53) original analysis of the recruitment and management of ‘migrant workers’ reflected the political priorities of the time. During the mid-1980s, West Germany was still struggling to come to terms with the immediate effects of the so-called ‘guestworkers’ immigration (Gastarbeiter), under which millions of young, mainly male workers from Mediterranean countries (principally Turkey, Yugoslavia, Italy, Spain, Greece and Portugal) had been recruited between 1955 and 1973 for work in West Germany. Although the recruitment ban (Anwerbestopp) of 23 November 1973 did prevent further new arrivals of labour migrants, most of the 4 million or so workers who remained in the country at that time began to make West Germany their home for good (Castles 1985).

This abrupt change in policy had a number of effects, which together helped to transform the issue of migrant labour into a much broader policy area by the time of unification in 1990. First, the perspectives of the remaining guestworkers in 1973 changed. Even though few members of this first generation of immigrants had initially envisaged spending the rest of their lives in West Germany, the practical likelihood of return to their countries of origin diminished with every year that passed (Bischoff and Teubner 1992, pp. 114–17). Second, the prospect of settling in Germany for either the medium or even the long term encouraged the development of new, secondary migration to West Germany in the form of dependants, otherwise known as family reunification (Familiennachzug).

It falls to very few social scientists to coin a term that defines a polity but this is precisely what Peter Katzenstein achieved with the concept of semisovereignty (Katzenstein 1987), which forged an indissoluble association between the old Federal Republic and semisovereignty. Moreover, this term is not just a convenient label, but a carefully worked-out explanation of the politics and policy style of the old Federal Republic. Many who have not read the book but who have encountered the term also assume that it refers to West Germany's sovereignty deficit in the international arena.

In Katzenstein's 1987 work, however, the emphasis is almost exclusively on internal constraints, many of them self-imposed, that limited the sovereignty of the West German state and by which, in Katzenstein's words, ‘The West German state has been tamed rather than broken’ (p. 10). These internal constraints included the system of co-operative federalism and the role of parapublic institutions, most notably the Bundesbank. It is, of course, Katzenstein's internally grounded conception of semisovereignty that most obviously suggests a continuing relevance to the post-unity polity.

Context: the Pre-Sovereign Years

The external dimension remained very largely unexplored, though Katzenstein enumerated, but did not analyse, a series of factors which informed his argument that ‘Semisovereignty is an external condition of West German Politics’ (Katzenstein 1987, p. 9).

Introduction: Can Semisovereignty be Transferred?

Peter Katzenstein's analysis of the ‘semisovereign’ West German state is one of the most enduringly popular conceptualisations of German politics. This chapter asks whether Germans could transfer this widely admired model of policy-making to the new states in eastern Germany. The chapter frames German unification around the idea of ‘institutional transfer’, an idea explored more fully in the next section. The point of departure is the progressive crisis of the state socialist model in the German Democratic Republic (GDR), followed by the collapse of the GDR state, and the widespread hope among eastern Germans that their territories might not merely join the Federal Republic but also be remade in its image (McAdams 1993; Maier 1997; Hampton and Soe 1999).

It would be unrealistic to ask of a model that highlights incremental change to explain the most rapid period of institutional and policy change in the post-war period. In that sense, the question here is not so much whether the semisovereignty model predicts or explains the main contours of unification, but rather whether the political features it highlighted – including incrementalism, political bargaining and societal engagement – survived the move to the east. This is no easy question, for there is no one answer valid across all policy domains. Clearly, institutional transfer has resulted in many similarities between the political economies of western and eastern Germany. The question, however, is whether these similarities are more than ‘skin deep’.

Public administration and public policies aimed at its reform occupy a central position in Peter Katzenstein's (1987) analysis of the semisovereign state. They appear in four distinct ways. First, a decentralised bureaucracy is the third of four defining features of the ‘decentralised state’ that Katzenstein contrasts with ‘centralised society’. The fourth feature, the constrained power of the chancellor, is also closely connected to the administrative organisation of the German state, since the constitutional right of ministers to run their departments without interference from the chancellor ‘reinforces the bureaucratic fragmentation (Ressortprinzip) inherent in the federal bureaucracy’ (1987, p. 23). Second, two of the three ‘nodes’ of the policy network – co-operative federalism and parapublic institutions – are directly associated with public administration. Co-operative federalism is, to a large extent, about co-operation between the administrations at local, Land and federal levels, and many parapublic institutions – such as the Federal Labour Office (Bundesanstalt für Arbeit) – are public authorities in all but name. Third, public administration is key to explaining patterns of policy development, for ‘West German bureaucracy presents structural obstacles to large-scale changes no less formidable than the interaction of coalition governments, co-operative federalism, and parapublic institutions’ (1987, p. 255). Finally, administrative reform serves as an illustrative case study for the ‘analysis of the organization and political capacities of the West German state’ (1987, pp. 254–5).

It is not difficult to see why public administration and administrative policy should be at the heart of the debate about the semisovereign state.

What has been the effect of unification on Germany? Was it negligible, as Tocqueville famously argued for the effect of the French Revolution on post-revolutionary France? Was it transformative, as British Prime Minister Margaret Thatcher feared at the time, as she watched what to her looked like a new German colossus poised once again at the apex of the European hierarchy of status and power? Or was it moderate, as I argue here, conforming to a pattern of change that typifies Germany well before 1989? The chapters in this volume provide an updated answer that gives me a welcome opportunity to revisit a book that I wrote almost two decades ago: Policy and Politics in West Germany: the Growth of a Semisovereign State (Katzenstein 1987).

I adapted the book's title from one of the classics of American political science, E. E. Schattschneider's (1960) The Semisovereign People. Schattschneider offers a sophisticated analysis of American political institutions and organisations as a mobilisation of class bias. ‘The flaw in the pluralist heaven is that the heavenly chorus sings with a strong upper-class accent’ (Schattschneider 1960, p. 35). Analogously, Germany's semisovereign state creates a bias for incremental action. What Stanley Hoffmann (1968) argued for the United States' foreign policy in world affairs, holds also for Germany's semisovereign state in domestic politics. A semisovereign state is not free to act as it pleases.