What Condition My Condition Is In

By John Mauldin


I woke up this morning with the sundown shining in
I found my mind in a brown paper bag but then
I tripped on a cloud and fell-a eight miles high
I tore my mind on a jagged sky
I just dropped in to see what condition my condition was in

Yeah, yeah, oh-yeah, what condition my condition was in

– Made famous by Kenny Rogers and the First Edition, 1968

For the past five weeks, I’ve written an open letter to the next president (whoever it turns out to be) about the economic realities he or she will face in the Oval Office on the first day. It is a rather daunting set of challenges. I have been trying to provide a realistic assessment of “what condition our condition is in.” The song the lines come from was actually a semi-veiled warning about doing LSD. My letters have been overt warnings about the economic dangers the next president and the country and the world will face.

In this week’s letter we will take a quick look at the condition of a slowing global economy (the IMF just downgraded its own forecast this last week). Then we’ll grapple with a Plan B scenario, because I have a confession of sorts: I am not entirely optimistic that Congress and the new president can get their act together, so I offer a proposal from former Oklahoma Senator Tom Coburn as to what we, the people, can do to actually change the country’s direction without having to depend on a Congress that may prove dysfunctional. Again.

The World Is Slowing Down

Jeffrey Snider of Alhambra Investment Partners sent out a note last week highlighting some of the current conditions. In his piece entitled “Not Just Manufacturing, the Global Slowdown Is Monetary,” Jeffrey cites a Wall Street Journal article that highlights the very serious slowdown in orders for new big rigs and other trucks. Inventories are at their highest level since before the financial crisis, and sales in March were down 37% from a year ago as fleets remained very cautious about expanding in this environment. Quoting:

Some of this reduction in 2016, as the Journal reports, is due to companies over-ordering in 2014 and 2015 based on the narrative that the economy was actually healing, or at worse would stay in its "new normal." It raises the issue as to whether these conditions and the manufacturing recession they reflect are cyclical or structural, or both.

As I wrote yesterday, the contraction in goods and the US economy's basis for them may or may not be heading toward recession. It is clear, however, that whatever the ultimate cycle reality, there are deeper imbalances that run back several years, likely traced to decades of financialization that is now overturning, and thus really supersedes cyclical discussion. What we see in the US is not limited to the US, however; it is a global phenomenon, which can only mean one possible explanation.

Jeffrey offers several charts that I think tell the story better than 1,000 words.

These charts have slowdown written all over them. And you can see the trend even more clearly when you look at factory orders on a non-seasonally adjusted basis over the years since the recovery:

The slowdown is not limited to the US. Look at what is happening to China exports:

The latest quarterly edition of the China Beige Book was out yesterday. The China Beige Book is just about the only true gauge of the Chinese economy. My good friend Leland Miller’s firm surveys 2200 Chinese companies every quarter and reports on their findings. Their work is a must-read in serious economic circles. Leland, one of the savviest experts on China there is, provided me with a summary:

Led by rising layoffs at private firms, job growth dropped notably for the second consecutive quarter, sliding to a four-year low. Expectations of future hiring took a similar dive. Overall, the share of firms hiring this quarter fell to half of what we reported in 2012.

This deterioration has wide-ranging implications. Despite the economy's overall deceleration, China has been able to defy calls to be more aggressive – either via reform or stimulus – because of the remarkable stability of its labor market.

This bought time, but Beijing hasn't used it wisely. If the weakness in employment continues, the credibility of government policy will be challenged by those who matter most: not financial commentators but ordinary Chinese.

Leland went on to point out that this slowdown in hiring has been brought about by two rather uncomfortable trends: First, the multiyear slowdown in capital expenditures is continuing, and now we have seen what almost amounts to a crash as the number of companies reporting capital expenditure growth has plummeted by 40%. Reduced capital expenditures, of course, affect hiring.

And companies, particularly private companies, are borrowing less. Money is available, but they simply don’t want it. They’re trying to square up their balance sheets. Other anecdotal evidence from private sources suggests that what borrowing there is, is being used to pay off dollar-denominated debt. The debt-fueled growth that has driven China for these past seven years, sputtering on fumes now, seems headed for an abrupt end. Likewise, the shift from manufacturing to services seems to have lost momentum.

The government still reports 6.7% GDP growth, but as Leland notes, China’s weakness is not about GDP:

With perceptions about China likely to guide global markets again in 2016, it has become more important for investors to look beyond headline GDP numbers – official or private. After all, Beijing didn't seem overly concerned when many indicators signaled weakness but job growth remained steady. If the opposite combination persists, China's purported restructuring and reform could lose the faith not only of markets, but also of the masses.

I will be writing a detailed letter on Europe in the near future, and quite frankly I view the European economy to be even more problematic than China’s is.

Brazil is clearly mired in a recession, amid political turmoil. Commodity-market economies have recovered a little bit as prices have bounced off their lows. But the massive dollar-denominated debt in emerging markets is starting to come due, and most EM currencies are much weaker than they were when the debt was initially taken on. Major economic problems are brewing in a number of countries.

I know the equity markets are close to all-time highs, but I also see real interest rates negative out beyond 10 years and certainly below 1% even out to 30 years. Those are not conditions that you see in a dynamic, growing economy.

As I’ve been saying for almost two years, the admittedly weak US data still doesn’t give me any real conviction about a particular timeline for a recession in the US. But with the US economy barely growing at stall speed, an exogenous shock to the US economy could easily push us into recession. Whenever the next recession comes, it will not look like the last recession.

Never Waste a Good Crisis

In my last two letters I offered a prescription for how to avoid a recession in the United States and how to trigger a new era of growth. Doing so would allow (or perhaps force) the Federal Reserve to normalize interest rates, which would allow savers to benefit once again from their years of saving. Pension funds and insurance companies would actually regain the chance to provide the benefits they have promised.

We may not see a recession this year, and hopefully not even next year – though that’s a hope and not a prediction – but sooner or later we’re going to see one; and if we haven’t completely revamped our incentive and tax structures, allowing the Fed to normalize rates, monetary policy will be impotent during the next recession, and Congress will be facing $1.5 trillion deficits with very little room to provide any real stimulus. I know I have shown you the following chart in the last two or three letters, but I want you to burn this picture into your mind. This is what is going to happen to the federal deficit when we go into recession:

I have lived through six recessions in my business life – and that’s the point: we do live through them. This recent recovery has been the weakest we have seen in the last 40 years, and I will make you a side bet that absent any restructuring of the tax and incentive systems, the next recovery will be even weaker, with the real potential for the United States to catch “Japanese disease.”

But we will suffer the slow-growth, no-recovery symptoms of Japanese disease without the cushion that Japan’s massive savings and current account surplus provide. We won’t have 20 years to muddle through as Japan has done.
Unemployment will rise to uncomfortable levels, and I fear that the Federal Reserve will begin to experiment with extreme forms of monetary policy, including negative interest rates. I acknowledge that there are very smart economists who think that negative rates can deliver positive benefits, but I simply think they are wrong. The evidence I’m looking at demonstrates that negative rates abuse savers and distort normal markets by obliterating the signals that the price of money (i.e., the interest rate) is supposed to send. The total financialization of the world’s reserve currency will not end well.

As I laid out in my last letters, our economic future doesn’t have to end this way. And candidly, the proposals I’ve suggested are not the only way that we can sort out our tax and incentive structures and achieve positive results. I can think of quite a few paths we could take. But just tinkering around the edges and more or less doing what were doing now is not going to get us where we need to go.

A recession is an avoidable dilemma, but averting the nasty economic storm that is brewing now will require leadership and compromise that haven’t been seen in Washington DC for some time. In general, the feedback I’ve gotten from my letter to the would-be president series has been quite good – much better than I expected. But the one real pushback from friends and readers is the very simple, skeptical question, “John, you don’t really think that this will happen, do you?”

Sadly, I must admit that I don’t. I am generally an optimistic person, and I would like to think that the people we elect this fall will do the right thing. But we’ve been saying that for about 16 years now. Our so-called leaders’ record on doing the right thing with regard the deficits and the economy is not cause for jubilation.

So, I think the more likely outcome is that we’ll have a recession and $1.5 trillion deficits and mountainous deficits as far as the eye can see, because it is really quite an impossible task to balance the budget without new taxes and growth incentives and without the massive fiscal stimulus that could come by repurchasing the Federal Reserve’s balance sheet to invest in infrastructure that would create 2 million+ jobs.

It was Rahm Emanual, the beleaguered current mayor of Chicago (why on God’s green earth did he want that job?), who once said, “Never let a good crisis go to waste.”

While the next recession will surely plunge us into a crisis, that crisis will afford an opportunity that those who want to restructure our federal government. The attempt will, quite frankly, require an end run around Congress. Thankfully, the founders of the republic stuck a helpful little section for that purpose into the Constitution. It’s called Article 5. It allows for 34 states to call a Convention of States to propose amendments to the Constitution, which then have to be sent back to the various state legislatures to win the approval of 38 states – no small feat. I will readily admit that it will take a crisis to push some of the needed states into the “let’s just do it” category. Getting 34 states to agree is a daunting task, but we might just get the crisis we need to accomplish that, and hopefully the country will not waste it.

The next section is a letter authored by former Oklahoma Senator Dr. Tom Coburn, one of my personal heroes. Tom was demonstrably the most fiscally conservative member of the Senate, constantly trying to figure out how to reform the process and get back to a balanced budget like the one we had in the later Clinton years. Unfortunately, Tom developed cancer (which is now apparently under control, thank God) and term-limited himself. We have corresponded and met off and on, and he is a personal inspiration as well as an enthusiastic believer that things can be changed. We need more like him, and I wish he were back in the Senate.

There are six states that have already passed the legislation necessary for calling a Convention of States. There will be another four or five that do so this year and perhaps between 10 and 12 next year. The organization pushing this issue will thus be able to focus their time and budget on getting the remaining states to make the call. So without further ado, let’s look at how we can take the process of fixing the problems in Washington DC back to the people.

An Outside the Box Solution as Big as Our Nation’s

By Senator Tom Coburn

Precision in numbers is critical to accountants and important to economists. But for most other people, there is a point at which a number gets so big that its increase seems irrelevant. This is a variation of the law of diminishing returns: the bigger the number, the less impact it has, because it is so far removed from anything people can relate to.

That is what has happened with the numbers reflecting our astounding national debt.

Nineteen trillion plus (and rising rapidly) dollars of debt on the books. One hundred forty trillion dollars of unfunded liabilities to boot. How many Americans can truly have any concept of what those numbers mean? If the deficit soon balloons to $1.5 trillion, the problem will become more severe.      

And as the numbers continue to grow higher (what comes after a trillion?), ordinary Americans become inoculated to rational concern about the looming disaster they represent. We keep hearing these astronomical figures, but we go on about our business as usual and feel no impact of the predicted storm. Some people even dare to hope that if the “right” candidate is elected President this year, they will receive more goodies from an increasingly generous Uncle Sam who maintains every outward appearance of being flush with cash.

Unlike a natural disaster, which sometimes comes with little warning and always through no fault of our own, our nation’s impending financial crisis is completely predictable and is the outcome of a machine we created and continue to operate.  It is an outcome of the federal government over which we, the people, have ultimate control.

We got into this mess because we have allowed the feds to operate far beyond their specific, enumerated constitutional powers. However well-intentioned the politicians who envisioned a national government program, policy, or regulation as the answer to every human need or problem, they were wrong. And now we are staring down the hard consequences of glossing over the original meaning of the Constitution, which never allowed for the type of plenary federal government we have today.

This is a hard truth and is difficult to actually process. But what we think is more important to grasp is that our responsibility for causing the crisis is just the flipside of the truth that we hold the power – indeed the duty – to make a course correction.

Having spent time in Congress, I am just as disillusioned as the next guy with the idea that there is some political solution to the situation that has any realistic prospect of succeeding. Every member of Congress knows that whichever Congress actually passes financial reforms that shut off the flow of money from D.C. will be fired. And politicians tend to want to keep their jobs.

The solution we need and can implement is not merely a political one. It has to be a structural one. It requires us to close the constitutional loopholes that allowed the feds to move beyond their proper, limited authority and initiate programs, engage in spending, and create agencies that are way outside federal jurisdiction under the original meaning of the Constitution.

The way we can realistically do this is through an Article V convention for proposing amendments to the Constitution. This is a state-initiated, state-led, and state-controlled process for proposing amendments that don’t sit well with the power-hungry elitists in D.C. It requires two-thirds of the state legislatures (34 states) to pass applications for a convention to propose amendments on a given topic. States then appoint and instruct delegates to represent them at the convention. Any proposals that garner support from the majority of the states (on a one-state, one-vote basis) are then submitted to the states. Proposed amendments must be ratified by three-fourths of the states (38 states) in order to become part of the Constitution.

There is already a massive, nationwide effort underway to trigger an Article V convention for the states to consider proposing a series of very limited amendments that impose fiscal restraints on D.C., limit its power and jurisdiction, and set term limits for federal officials – including federal judges.

It’s called the Convention of States Project, and it has made huge strides in just a few years. Six states have already passed their applications. Approximately thirty-four more will take up the issue this year. Over 1.2 million people are engaged at some level—from volunteer leaders in all 50 states to Facebook followers.

The project has been endorsed by some of the greatest statesmen, economic experts, and legal minds in the country, including Sen. Marco Rubio, Governor Greg Abbott, Thomas Sowell, Mark Levin, Michael Farris, Randy Barnett, Robert P. George, Chuck Cooper, and countless others.

Imagine what America would be like if Congress’s taxing and spending power could only be used in relation to its specifically enumerated powers in Article I, as originally intended.

Imagine if we had a robust, functioning federal system again, with the states deciding the lion’s share of the policies that govern their citizens rather than doing the bidding of Washington, D.C. as it holds their citizens’ tax dollars hostage.

Imagine if businesses and industries weren’t assaulted on every side by rules and regulations being crafted by unelected bureaucrats in ivory towers at a rate of over 80,000 new pages a year.

America could be, again, what the Founders intended and designed: a constitutional republic suited for a free, industrious, self-governing people.

Once we do realize that a natural disaster is coming, we take the concrete, necessary steps to prepare for it and protect the lives and property in its path. It must be no different with the national financial crisis we see on the horizon.

We must repair our constitutional levees by mobilizing the states to forcibly impose discipline on a fiscally irresponsible Washington, D.C. And we must ensure that this self-made storm can never be re-created.

Learn more and get involved in the Solution as Big as the Problem, at Convention of States Action. Senator Coburn can be contacted at SenatorTomCoburn@cosaction.com.

Some Thoughts on a Convention of States

The Convention of States Action website has a great deal of information, and I encourage you to look it over carefully. But let me give you some of the highlights. One of the criticisms is that a Convention of States could be a “runaway” convention. That is not the truth. To call an Article V convention, the states must all pass the same very specific legislation, which limits the agenda of the convention. The convention that is currently being proposed is not meant to deal with a social agenda; it is all about fiscal constraints and process.

What might come out of it would be a series of proposed amendments, such as a balanced budget amendment, a term limit amendment, a definition of what the “general welfare” clause of Article I of the Constitution actually means, and other amendments that would reduce the power of the federal government in favor of the states on fiscal and operating matters.

But a proposed amendment is just that, a proposal. It then has to be approved by the legislatures of 38 states. That is a tall order. I can see from looking at the proposed agenda for this Convention of States that among the amendments that would be proposed there are some that I would enthusiastically endorse and some about which I would be a little bit reluctant.

It is supposed to be difficult to amend the Constitution. That was by design. I can see a balanced budget amendment possibly getting passed by 38 states, but some of the other proposals might have more difficulty. The states would have the ability to pick and choose among the amendments. They would not have to adopt all in order to get one. That is the genius of the structure of the Article V convention.

When you talk, as I have, to the people who are driving this process, you see that they understand the need for any major change in the budget-control process to be phased in over time. You couldn’t make the shift in just one year.

Term limits might have a more difficult time getting through some state legislatures, but I think the amendments to allow the states more control over their internal operations might have a great deal of bipartisan support in many states.

By its very nature, Congress is not going to discipline itself. If there is going to be any discipline, it will have to come from the states taking back control from Washington DC.

Right now, many of you are looking at the federal government and wondering, “Where’s the crisis? Why the urgency?” When the markets are in turmoil in a few years, when unemployment is high and rising, when Boomers who have retired can make almost nothing on their savings or investments, there is going to be a crisis and a demand for real change. I hope we don’t waste that crisis.

The Convention of States Action organization needs your help. If you would like to get involved, they can put you in touch with the people who are already active in your state. As with any project this big, they need money; and in a year when we are going to spend billions on the political process, a few extra million invested here could actually make a difference. And when you meet or contact your state legislators, give them a heads-up on the Convention of States and tell them it’s something we need to do. Get them thinking about it now, as they will likely be voting on it – if not this year then next year.

This convention won’t be convened in time to help us avoid the next recession, but it can help change the economic reality of the recovery, and maybe that is the best we can realistically hope for. But the best we can more optimistically hope for is that Congress and the new president will see that the Convention of States process is beginning to snowball and decide together to go ahead and do the right thing.

Dallas, Houston, Abu Dhabi, Raleigh, SIC, and Lemonade

I will be speaking in Dallas on April 28 for the 14th annual Commerce Street Bank Conference. Then the next week I will again speak in Dallas for the seventh annual Inside Retirement conference, May 5-6. They have a great lineup of speakers, but I am most excited about getting to hear and maybe even speak to my personal writing hero, Peggy Noonan. I will admit that I’m a total fan boy of anything she writes. Then the following week I fly down to Houston to speak at the S&P Dow Jones Art of Indexing conference on May 10. The conference is for financial advisors and brokers who are trying to understand how to manage risk while maximizing returns in the current environment.

I will be in Abu Dhabi the third week of May and then come home and almost immediately go to Raleigh, North Carolina, to speak at the Investment Institute’s Spring 2016 Event. I’m looking forward to hearing John Burbank and Mark Yusko (who will also be at my own conference the same week) and then being on a panel with them. Afterward, I make a mad dash for the airport, arrive back in the Dallas late Monday night, and start to prepare for the Strategic Investment Conference, where upwards of 700 of my closest friends will gather to discuss all things macroeconomic and geopolitical. It is really going to be a great week.

On a fun but also quite serious note, as many longtime readers are aware, I’ve spent a bunch of time researching and thinking about the jobs of the future. One conclusion I've reached is that in our globalized, UBER-controlled, task-oriented marketplace, raising kids to understand entrepreneurship and financial literacy is of crucial importance. A really good friend of mine in Dallas (and a reformed hedge fund manager), Reid Walker, agrees with me and is co-founder of Lemonade Day Greater Dallas.

Lemonade Day is all about teaching kids these important lessons by encouraging them, with the support of caring adults, to open their very own businesses: lemonade stands. The kids who get involved are paired with mentors who help them to put together a business plan, get a loan from a local business or bank based on that plan, and then actually sell the lemonade and pay back the loan, keeping the profits. Here in Dallas last year I found all sorts of businessmen, investors, and other financial types working with the kids, who present their business plans at the Dallas Federal Reserve.

Lemonade Day, which was founded in Houston nine years ago, has spread to more than 58 cities across the US and is expanding around the world, with over 220,000 kids participating last year. It’s not too late for you to register your child and join the movement on Saturday, May 7th. And if you go to the website and don’t see your city involved, then maybe you should pick up the baton and see about starting to train the next generation of entrepreneurs. The photo below is from a recent Lemonade Day, with your humble analyst, Reid Walker, and Danielle DiMartino Booth surrounded by some of the kids who participated in Dallas.

It really is about building the future.

It is time to hit the send button. Recently, I haven’t been finishing the letter until later in the weekend, but this Friday afternoon I actually polished it off and sent it to the editing team. If I hurry I can make a movie or at least a fun dinner. So let me tell you to have a great week and move on down the road! And in the mood for a little nostalgia may want to watch a very young Kenny Rogers and the First Edition. This was from his TV show Rollin’ on the River in the early ’70s. Hard to believe he is now 77. Where have the years gone?

Your hoping we can turn things around analyst,

John Mauldin

The New Europeans

As refugees stream into Europe, and terror attacks spark security fears, one Bavarian village grapples with newcomers — and with the question of what it means to be German.


It was on a Friday in September 2014 that Thomas Kamm, the mayor of Siegsdorf Municipality, an affluent cluster of villages in the foothills of the Bavarian Alps, learned that the world refugee crisis would be coming to his town. He was barbecuing for his wife’s birthday when he received a call from the German Interior Ministry. Four hundred asylum seekers, who recently arrived in the European Union on the Italian island Lampedusa, were being transported to Germany, the ministry official informed him. A vacant bungalow resort located in one of the villages under the mayor’s jurisdiction — Eisenärzt, population, 1,300 — had been determined a suitable place to house them temporarily.

Kamm, a thin, middle-aged former mechanical engineer and a singer in a local a cappella group, managed to negotiate down the number of asylum seekers his town would host, to 200 from 400. The villagers, he told me, were wary of hosting a large number of foreigners from places like Syria and Afghanistan; 400 of them would be “absolutely a no go.” The first migrants arrived on buses two days later. Kamm said he would never forget the looks on their faces. “Pure exhaustion, pure fear,” he said, exhaling so deeply that his lips flapped together. Each of his parents lived through World War II, he told me, but they never said much about their experiences. “I can understand why after seeing those refugees.” That Sunday, Kamm went to local churches to inform the citizenry. “No one was happy,” he said. Still, most people recognized the need to help: “Humanity stood in the foreground.”

This amalgam of alarm and empathy was once again evident last June, when Kamm returned to church to inform the villagers of Eisenärzt that more asylum seekers were on the way. By then, the original 200 migrants had been resettled elsewhere, but many more asylum seekers from places like Syria, Iraq and Afghanistan were arriving on Greece’s Aegean Islands in perilously overcrowded boats, then forging a grueling path through the Balkans toward the security and prosperity of Northern Europe and, most often, Germany. Bavaria was the first German state they encountered along the way. Migrants were showing up in train stations or emerging from the backs of smugglers’ trucks, and it often fell to local officials, people like Kamm, to find somewhere to house them.
Asylum seekers ended up in school gymnasiums, shuttered big-box stores and crowded tent encampments.
Kamm told the people of Eisenärzt that an order of Franciscan nuns living in the village would be leaving town. In their place, 100 Syrians would be moving in. The Mallersdorfer Sisters, based in a convent in northern Bavaria, had maintained a presence in Eisenärzt for 85 years.
The village, with its forested hills and alpine air, served as the sisters’ vacation spot and retirement home. On Monday evenings in May — when area Catholics in this heavily Roman Catholic part of the country observe Maiandacht, a time of devotion to Mary — the sisters would gather outside the newly built chapel on a grassy hill by the train station, not far from the crystalline flow of the White Traun River, and sing lilting Bavarian hymns. By 2015, though, Germany’s declining birthrate and declining religiosity had taken its toll on the sisterhood. The once-crowded residence, constructed in the late 1960s, was mostly empty, and the two dozen sisters who remained, many of them in their 80s, had agreed to sell their residence to the municipality for the purpose of housing asylum seekers.
Many of the villagers were not pleased with this development. Some expressed concerns about the safety of local women and children, and others later grumbled about the cost to taxpayers.
The mayor argued that the move prevented a more unpalatable outcome. It was clear that the Mallersdorfer Sisters’ mostly vacant residence was an ideal shelter; technically, it was big enough to fit 350 asylum seekers. If the municipality did not buy the building, the district government or a private investor seeking to rent it to the government would, and those outside buyers would likely fill it to capacity. Ownership would provide the town with some ability to control its fate.
The mayor’s argument was widely accepted around town, but this did not seem to comfort him.
In his office last fall, Kamm suggested that he had barely prevented a citizen uprising. Had 350 asylum seekers come to Eisenärzt, the reaction would have been “riots,” he told me. The situation, he believed, still remained volatile. I found it hard to imagine rioting in a bucolic Bavarian village and asked the mayor if he was being a bit dramatic. He said that he meant something like the anti-immigrant protests that were occurring weekly in Dresden and had spread to other parts of Germany, sometimes attracting tens of thousands. These were not just peaceful demonstrations, Kamm said; there was something menacing about them. Should the situation in his town “escalate,” he expected similar protests. He said that the majority of asylum seekers were men from Syria, many of whom would try to bring their families — “their three kids and their two wives,” as he put it. “The number of Syrian people will explode here.”
The mayor told me that he had received anonymous letters that were “clearly xenophobic.” They did not represent the views of the vast majority of his constituents, he said, many of whom exhibited commendable charity. But the mass of people entering the country was so uncontrolled, he said, that even people with good intentions were upset.
Kamm had a few policeman friends who had worked on the border; his doctor, too, had volunteered there. They shared with him disconcerting stories about the chaotic registration of migrants, many of whom arrived without documentation. One arriving migrant, he heard, needed a new kidney; others had ailments requiring expensive medicines. The German taxpayer was on the hook for their care.
By the end of August, the Mallersdorfer Sisters had departed. In September, the first of the Syrians arrived.
In the past five years, as the number of people displaced worldwide by conflict and persecution has reached a level not seen since the end of World War II, many Germans have expressed pride that their nation — which unleashed the violence that prompted the earlier mass flight — has now become a beacon of safety and opportunity for imperiled and dispossessed people around the world.
The degree to which many Germans embraced this new identity became exceedingly clear last summer, when Hungary tried to stop the mass of Germany-bound migrants traveling through the country by cutting off their access to trains. Migrants stranded outside Budapest’s Keleti train station chanted: “Germany! Germany!” And within days, roughly a thousand of them had set out on foot from Hungary and across Austria to Germany, some of them holding posters of the German chancellor, Angela Merkel. Merkel, fearing chaos should she turn the migrants away, instead sent German trains to pick them up, a decision she later called a “humanitarian imperative.” As migrants arrived at Munich’s central station, local residents greeted them with cheers and applause. Some handed out chocolate and balloons. Germans spoke of their strong Willkommenskultur, or “Welcome Culture,” and German politicians portrayed the warm reception as a moral achievement, a further step toward redefining modern Germany as a benevolent nation that has moved beyond the ignominy of its ultranationalist past.
The rise of Willkommenskultur was especially striking because Germany, like other European countries, has not traditionally viewed itself as a destination for migrants. Until the turn of the millennium, national policies on immigration could be summed up by a mantra often repeated by Chancellor Helmut Kohl, Merkel’s predecessor and mentor, that Germany is “not an immigration country.” This was despite the earlier arrival of hundreds of thousands of “guest workers,” laborers from Southern Europe and Turkey, who came to work in West German factories during the postwar economic boom. The change in attitude has been rapid; in 2012, Germany, with its strong economy, became the second-largest immigration country in the Organization for Economic Cooperation and Development, after the United States. The scale of the influx last year — roughly one million asylum seekers in all, nearly half of whom made formal applications — was exceeded in German history only by the influx of “ethnic Germans” who were expelled from Eastern Europe and the Soviet Union after World War II. The country now faces the greatest test yet of its willingness to transform itself into a multiethnic nation.
The migrant influx has also put widely held convictions about European values to the test.
Some countries have instituted border controls to manage or repel the movement of migrants, undermining one of the European Union’s fundamental pillars: free travel across open internal borders. The influx has also increased the popularity of far-right, anti-immigration parties, and even centrist politicians now often see an anti-immigration stance as a necessary act of political survival. In January, Denmark, whose minority government is dependent on cooperation with the far-right Danish People’s Party, passed a law enabling authorities to seize jewelry and cash from asylum seekers in order to offset the costs of their stay. In Austria, an initial welcome of asylum seekers dissipated after far-right parties made decisive gains in regional elections last fall. In February, Austria led a coordinated effort with countries to its south to shut down the migration route through the Balkans. The move trapped tens of thousands of asylum seekers in Greece, a nation with a woeful incapacity to care for them. Many have been stranded in squalid, makeshift camps.
Merkel, concluding that the only way to hold the European Union together was to curb migration closer to the source, pushed for a deal with Turkey. Turkey — in exchange for, among other incentives, the revival of stalled talks on its bid to join the European Union — agreed in March to take back Syrians and other migrants who used the country as a steppingstone to Europe. The deal, questionable in legal and ethical terms, did little to quell the concerns of many Germans about the migrants already among them. Terrorist attacks in Paris and Brussels have inflamed fears that ISIS is exploiting the refugee crisis to infiltrate Europe undetected; they have also heightened longstanding concerns about Islamist radicalization in disaffected migrant communities. In February, the head of Germany’s domestic intelligence service assessed the risk of a terrorist attack in Germany as “high.” And the wave of sexual assaults and robberies attributed to a multitude of young North African and Middle Eastern men, among them asylum seekers, on New Year’s Eve in Cologne drew comparisons to the mass sexual assaults on women in Tahrir Square during the Egyptian revolution, sparking a debate about a clash with “Muslim culture,” as one conservative parliamentarian put it.
Through it all, Germany continues to struggle with the challenge of transforming itself into a republic of shared ideals rather than shared blood. Across the mainstream political spectrum, there is a growing sense that German values must, in the face of rapid social change, be quantified and propagated. What exactly those values are, however, is far from settled. German political discussion on the matter often revolves around the concept of leitkultur — or “leading culture” — common values that extend beyond mere adherence to the law. Conservative leaders often describe those values as Judeo-Christian and suggest that those from other “cultural circles” stay out or adapt. Some German leftists counter that a formerly Nazi country should not compel anyone to abide by a perceived set of common values. Amid the debate, efforts to relay German cultural values to newcomers can become muddled. A guide to “Germany and its people” published by the Bavarian public broadcaster tells migrants to “always look the person you’re talking to in the eyes.”
As Germany struggles with these questions of identity, fear is fueling the kind of far-right, populist backlash that, until recently, was contained by a mindfulness of the Nazi past. The migrant influx has been accompanied by a sharp rise in extremist demonstrations and violence directed at foreigners. It has also provided a boon to Alternative for Germany, a far-right party that formed in 2013 in opposition to the euro and that has now galvanized support by vowing to keep migrants out.
Supporters at party rallies often chant: “Wir sind das Volk,” or “We are the people,” a refrain previously employed by pro-democracy demonstrators in communist East Germany, when the phrase evoked a yearning for democratic rights. Now it has been co-opted by far-right groups who perceive the “we” as having a tribal or ethnic meaning. In January, Alternative for Germany’s leader, Frauke Petry, suggested that the German police “make use of firearms” if necessary to keep migrants from crossing the border. After the attack in Brussels, she declared:
 “The dream of a colorful Europe is broken, bombed away yet again. Accept it at last.”
      Yasser in his apartment in Eisenärzt. Credit Hellen van Meene for The New York Times
Merkel continues to present an optimistic face — “We can handle this,” has been her rallying cry — but domestic critics accuse her of having failed to grasp the severity of the public’s worry. Much of that criticism has come from an ostensible ally, Horst Seehofer, the head of Bavaria’s state government. Seehofer leads the Christian Social Union, a more conservative sister party to Merkel’s Christian Democratic Union, that has ruled Bavaria almost without interruption since the end of World War II. He has threatened to sue the federal government for failing to secure the national border and calls for a strict limit on the number of asylum seekers allowed to cross it. It is no surprise that such opposition should come from Bavaria, a border state with an independent streak dating to its incorporation into the German empire in 1871. Bavarians still sometimes refer to the Germans to the north, derisively, as Prussians. They are proud of their relative economic affluence (unemployment in the state, at around 3.9 percent, is among the lowest in Germany); devoted to their cultural heritage (it is the land of Oktoberfest and a centuries-old beer-purity law); and speak a dialect that, unless diluted, can be virtually incomprehensible to other Germans.
Among the first Syrians to show up in Eisenärzt was Yasser, a stocky, 37-year-old seaman from the Syrian port city Latakia. When the bus dropped him off in front of his new home, Yasser told me, he had the sense that none of this strange new reality could be his. He said he had felt that way since a day last summer, when he was working on a ship bound for Tartus, Syria, and received word from a friend back home that uniformed men were looking for him. Until then, life in Latakia had still been manageable, despite the war. The city, a stronghold of Bashar al-Assad, had not seen the kind of fighting that has shattered other parts of the country. Yasser told me that he could still find work at sea to provide for himself and his wife, an architect in her mid 20s. They had lived a good life in Latakia; he had decorated their home with various souvenirs from his international travel — a sword from China, a tiger sculpture from Sierra Leone. In his free time, he rode his Suzuki motorcycle, and the roar of its 1,000-c.c. engine was a source of pleasure and pride. Yasser told me that he completed his mandatory military service years ago, but the men in uniform wanted to re-enlist him to fight for Assad. He could not fathom fighting for any side in the conflict. “I cannot hit a cat,” he told me.
Rather than return to Syria, Yasser said he disembarked from his ship off Istanbul and joined the human tide making its way to the European Union. His wife remained in Latakia. (Yasser, like many other Syrians I met in Germany, asked that I withhold his last name to protect the safety of relatives back home.)
When Yasser arrived at the Mallersdorfer Sisters’ former residence in September, he was shown to his single room on an upper floor and greeted by the caretaker of the residence, Beni Beilhack, a multiple-pierced 36-year-old with thinning hair and a persistent smile. In the following days, Yasser, bored, began to follow Beilhack around, hoping to help with work around the residence. Eventually, Beilhack delegated some tasks to Yasser: repairing a broken doorknob, blowing leaves off the hiking trails near the residence. By October, Beilhack had outfitted Yasser with work clothes and made him his unofficial assistant. The two communicated with a peculiar mix of English, German and Arabic.
Under Yasser’s tutelage, Beilhack’s command of Arabic profanities expanded rapidly, and Beilhack dispensed this knowledge liberally throughout his workday, to the delight of many of the young Syrian men. Beilhack, who worked as a truck driver before the Syrians came to town, told me he did not miss his old job, and he seemed to relish his interaction with the Syrians. He started inviting Yasser to family dinners. After school, Beilhack’s son, Luca, then 12, often came by the residence.
The Syrians were generally “warmer” than the local residents, Luca told me, adding, “I’d be happy if they lived here forever.”
Beilhack’s 64-year-old mother, Evelyn, also works as a caretaker at the residence, where she lives on the ground floor with her husband. Evelyn held the position previously, when the sisters lived there.
When Evelyn learned the Syrians would be moving in, she rejoiced. The nuns nitpicked about the smallest details, she told me, creating an oppressive work environment. She grew up in what she called a “very international” town, a place called Geretsried, south of Munich, which was settled by Germans expelled from Eastern Europe after World War II. Later, Southern European guest workers arrived. Growing up there left her open to seeing what the asylum seekers would be like. “You hear from a lot of different places about what an abominable people they are — not Syrians, but altogether, this whole mass of asylum seekers that are streaming in here,” she told me. People called them “terrible and slobs and poorly raised and primitive.” She wanted to find out for herself, she said.
“I thought: I’ll take this on. I want to see this. I want to know this.”
Her experience with the Syrians did not confirm the prejudices. “They are respectful; they’re nice,” she said. Like her son, she seemed to enjoy the Syrians’ company. One evening, a saxophonist from Damascus serenaded her in the former chapel, stripped of religious relics, where the Mallersdorfer Sisters used to worship. The saxophonist stood next to the recently installed foosball table and puffed out a version of Lionel Richie’s “Hello.” One of the young Syrian men sitting next to Evelyn feigned being her companion in a cafe. “Garçon! Two glasses of wine!”
Through his conversations with the Beilhacks, Yasser began to understand something of life in Germany. Evelyn told him how much money was deducted from people’s paychecks for taxes and health insurance, and the cost of living generally seemed far higher than in prewar Syria. Back at home, his wife did some work in a private office, but he would not allow her to work for a firm.
Women in Syria were not supposed to hold down such jobs, he said. In Germany, however, he would have to reconsider. He and his wife probably wouldn’t be able to afford a house and a car if she didn’t work too. “Life here is hard,” he said. If the war in Syria ended, he told me, he would go back in a minute.
Despite his growing friendship with Beni Beilhack, Yasser spent a considerable amount of time cocooned in his room, his mood dark. Yasser had worked since his teenage years. Out at sea, he was a boatswain, supervising deck crews. In Germany, he was living in what was effectively an isolated dormitory with little to do but smoke and sip tea. During his journey from Turkey, another migrant told him that Germany would allow him to bring his wife after six months.
Yasser, however, was realizing that it would take a lot longer, if he would be able to bring her at all. “I can’t live without my wife,” he told me. The process of “family reunification” — a legal method for recognized refugees to bring their families to join them — is often long. German politicians have meanwhile debated whether to seriously limit the practice. In November, the interior minister, Thomas de Maizière, announced that Syrians would, in the future, be granted a lesser form of protection instead of refugee status, and as a consequence, they would lose the right to bring their families. The announcement sparked uproar within the governing coalition, and the ministry backtracked.
Like Yasser, Beilhack took the message personally. “If some right-wing extremist comes here, I’ll be standing in front,” he said. Last year, Germany had more than a sixfold increase in the number of violent crimes directed at residences for asylum seekers and refugees: 177 offenses, including 94 cases of arson or attempted arson, according to a provisional tally by the Federal Criminal Police Office. The growing violence drove the German president, Joachim Gauck, to speak last August of two Germanys in conflict with each other: “Bright Germany” — the Germany of charity and compassion — against “Dark Germany” — the Germany of hate and xenophobia.
Anja Bech, who helps refugees learn German, with her children. Credit Hellen van Meene for The New York Times
In Siegsdorf Municipality, it was not hard to find “bright Germany.” Shortly after the Syrians arrived, local volunteers organized German-language courses for them, and one morning, Anja Bech, a psychologist, stopped by to teach one class with her three small children. The children sat at a table playing with dolls and a teddy bear.
“Good morning,” Bech said to the all-male class in German. “These are my children.”
The Syrian men responded in unison, as instructed: “Those are your children.”
Bech seemed to take genuine delight in the Syrians’ progress. “You’re all very good!” Her children helped with the lesson, holding up colored pencils and announcing the hues. “This is orange,” said Elena, who was 7. “Orange,” the men repeated. “This is what a teddy bear looks like,” said Jakob, age 5.
Most people I met, however, did not seem embroiled in a cosmic battle between bright and dark sides, as Gauck had outlined it; instead, many occupied a kind of gray Germany, where ambivalence reigned. Even some of those who reached out in fellowship to the asylum seekers were not free of apprehension about their arrival. When I met a local Catholic priest, Thomas Graf von Rechberg, in his office in Siegsdorf, he told me that Pope Francis’ visit to Lampedusa in July 2013 — Francis’ first trip outside Rome as pope — had moved him to reach out to asylum seekers arriving in his area in order to calm rising tensions and to “defuse the social explosive agent.” When, the following year, 16 asylum seekers, many of them from Afghanistan, moved in to a guesthouse near a towering church where he preaches, Graf von Rechberg began making occasional visits. Last November, the day after the terrorist attacks in Paris, he planned to go again, but he was struck by what he described as a “strange feeling” that made him hesitate. He nevertheless decided to visit the home to hand out pictures of Mary and some sweets.
“It was for me, really, psychotherapy,” he told me. It didn’t matter that not everyone accepted the pictures of Mary. The experience healed him “from the mistrust that forms.”
Graf von Rechberg is an interesting man. He invited asylum seekers into his home for dinner, but he held an almost apocalyptic view of their presence in Germany. Many of them, he predicted, would come to live in Muslim-majority ghettos like those in Paris, “where they don’t do anything, don’t work and then watch some stupid Internet films, and then some will carry out terrorist attacks,” he said. “I can’t change that. I can only accept it, and that will be our future.”
One Saturday night in Eisenärzt, I crashed a party at the volunteer fire department. The social life in small Bavarian towns like Eisenärzt revolves around their vereine, or clubs, whether the ski club, the shooting club or the volunteer fire department. On the night of the party, the fire trucks had been backed out of the garage, and in their place, a buffet was set up. People dined on roast pork and bread dumplings, washing it down with bottles of lukewarm local beer. A D.J. played Bavarian folk.
I sat at a table across from Rainer Klapfenberger, a 62-year-old retiree who serves on the town council. Klapfenberger, a Social Democrat in a part of the country where there are not many Social Democrats, told me it was proper that asylum seekers and refugees in Germany benefit from its expansive social safety net. For Klapfenberger, however, the problem was that the same safety net had proved inadequate for many Germans. “How many people in Traunstein” — a small city nearby — “are picking through the garbage for bottles?” he said. “We’re giving preference to the refugees against our own poor people. Many people don’t understand that.”
That sentiment is widespread: In February, Vice Chancellor Sigmar Gabriel, the leader of the Social Democratic Party, called for an increase in public spending — “a new solidarity package for our own population” — in order to quell such discontent. Gabriel said he, too, often heard Germans say, “For them you do everything, for us you do nothing,” and this required remedy. (Merkel’s Christian Democrats rejected Gabriel’s idea.)
As the effect of the alcohol set in and the dance floor filled, I went to sit with Hans Scheck, a retired metalworker and the chairman of the Eisenärzt Trachtenverein, a club dedicated to preserving local sartorial and dance traditions. Members of the club dress in Tracht (wool jackets and lederhosen) and some perform Schuhplattler (a dance that involves a lot of slapping of the shoes, thighs and knees).
Scheck’s son, Christian, joined us, half-jokingly offering to “translate” his father’s Bavarian dialect for me.
Evelyn Beilhack, Beni Beilhack, right, and Luca Beilhack, second from right, with refugees from Syria at the residence for asylum seekers in Eisenärzt. Credit Hellen van Meene for The New York Times        
“People have justified worries about how things will turn out if other cultures take the upper hand,” the elder Scheck said in the small firehouse meeting room, where we had moved to escape the loud music. He’d seen one Syrian walking around town with a girl on his shoulders, presumably his daughter. “Where was the wife?” he wondered. Scheck presumed this was a sign of gender inequality. “With us, men and women are equal,” he said.
At this point, Christian, who worked for a medical-supply distributor, chimed in. The refugees, he believed, would have a hard time entering the work force. He praised Germany’s strong apprenticeship and vocational-training tradition, of which he had partaken, and was skeptical that asylum seekers’ qualifications could compare. In September, Germany’s labor minister, Andrea Nahles, warned that fewer than 10 percent of asylum seekers arrived with the qualifications needed to immediately begin a job or apprenticeship. Unemployment, she warned, would rise. Over the long run, many German economists said, the migration wave would benefit the economy, but everyone agrees that this will require significant upfront investment in education and job training.
Christian and his father didn’t think it would work out well. Many of the Syrians wouldn’t want to stay in a small village like Eisenärzt anyway, Christian said. They would want to go to Munich or Berlin. “That’s the one advantage that we have.” As an afterthought, he added that his son had enjoyed playing with some of refugee children who briefly stayed in town one year earlier. They met on a soccer field. “The children can get along with one another a lot more easily than the adults,” he said. “They’re free.”
On the November night that I first met Khalil Qraluq, an asylum seeker from Afghanistan in his early 20s, he was drinking with his Afghan housemates. Qraluq came to Germany two years earlier and was living at the guesthouse next to the church in Siegsdorf — the place Graf von Rechberg occasionally visited. It was a Sunday, and several Afghans were gathered in one bedroom. Afghan pop music pulsed from someone’s mobile phone. The windowsill was lined with plates of tepid, untouched kebabs, which the kitchen downstairs had prepared. Most of the Afghans were drinking beer, but Qraluq was having vodka as he smoked an uninterrupted series of hand-rolled cigarettes. He tended to puff the smoke out of his mouth and inhale it again through his nose, giving the impression that a roiling white cloud was suspended over his upper lip.
Many of the Afghans I met in Siegsdorf told me that the Taliban would immediately kill them if they returned. On the night I met him, Qraluq told me not to believe everything I was told.
“Lots of people who come here are lying,” he said. Qraluq, however, said he had no reason to lie. He told me that he served as an interpreter for British and Danish troops operating in Helmand Province in 2011. The Taliban, he said, got word of his cooperation with foreign troops and threatened him and his family.
When that happened, the family fled to Pakistan. From there, Qraluq continued on to Germany. If the German government tried to return him, he was certain he would be killed: “I’m on top of the list.”
Qraluq went back to his small room, which he shared with an Eritrean asylum seeker with whom he did not get along — “I’ve become allergic to the sound of the Eritrean language,” he
said — and came back with some evidence of his interpreter service, like letters of appreciation from two Danish captains.
“Khalil is very pleasant and never complains,” read one of them. By his own account, though, Qraluq was no longer as pleasant as he once was. Two years of waiting on an asylum decision had left him embittered. He had trouble sleeping and felt constantly tense. He was tired of being an asylum seeker, he said, of getting dirty looks on the street. “When they look, they hate me.”
Qraluq’s unhappiness hadn’t made him idle. He attended vocational school and had learned to speak pretty good German. He also worked roughly 50 hours a month at a supermarket in Traunstein and was set to begin an apprenticeship there later in the year. The day after the drinking session, I met Qraluq at an auto-repair shop where he was interning as part of his vocational-school training. As he cleaned the grease off a hose with turpentine-soaked paper towels, he told me about the time in Helmand Province that he was sitting in a tank with Danish soldiers and a roadside bomb went off in front of them. “The gunner was bleeding from his eyes, nose and ears,” Qraluq said. A few days later, I accompanied him to his job at the supermarket. We arrived a bit early, and he lit a cigarette outside, in front of a large advertisement that said, “The Best of the Best.” Qraluq told me that he used to want to be a politician or a diplomat. Now he just wanted a simple life. If everything went according to plan, he would complete his supermarket apprenticeship in three years. A few moments later, the deputy store manager, Philipp Huber, 22, walked out and lit a cigarette. He praised Qraluq for being self-motivated. It wasn’t easy for the supermarket to find good workers like him, he said.
Qraluq started his shift in the drinks aisle, making sure the juice cartons were perfectly aligned. Later, he visited a break room and lit a cigarette. After a few drags, a voice echoed over the sound system. “Khalil to the vegetable department.” Qraluq quickly extinguished the cigarette and ran out to stock some persimmons.
“How sweet!” said Sieglinde Seidl, a smiley woman who had just taken a seat in the break room.
“Very nice guy.” Seidl was a butcher and had worked in the meats department for 26 years. “When I hear people complaining about refugees, I tell them, ‘You don’t know how good you have it,’ ” she said. She then vaguely recalled having some colleagues long ago who were refugees — she couldn’t quite remember from where — but they had to leave the country. “Maybe they were from Bosnia?” I suggested. In the early-to-mid-1990s, during the Bosnian War, Germany gave temporary protection to 345,000 refugees from Bosnia-Herzegovina. In 1996, the German government started an effort to send them back. Seidl thought Bosnia sounded right. It was a real shame when those former co-workers had to leave, she said. “I hope these refugees get to stay.”
When I met Qraluq again in late winter, he was more anxious and had dropped out of vocational school because of absences. He was trying to get back into a better mood, he told me, but it was a struggle. He had seen Syrians receive refugee status even though they arrived in Germany long after him. He could not understand why the Europeans didn’t want Afghans. “What is the problem with us?” he said. “What did we do in Europe? No Afghans attacked Paris.”
It was not entirely surprising, then, that one of the most openly angry people I met in Eisenärzt was an American woman from Ohio named Allison Kollmayer. I ran into Kollmayer at the village Christmas bazaar, a small sale to raise money for charity at the local church. The event mostly drew elderly residents, who dined on cake and coffee served to them by women in dirndls. When I arrived, I sat at a table and tried to make conversation about the 100 Syrians in the village. The guests reacted with remarkable silence. Then someone introduced me to Kollmayer, who was holding one of the items for sale — a pine cone topped with a miniature Santa hat. “We are against this huge onslaught!” said Kollmayer, who married a local man and has lived in Eisenärzt for three decades. “I’m really, really angry.”
After fuming for a while, she paused and laughed, as if amused by her own anger. She seemed a bit uninhibited for the gathering, and people in the room looked uncomfortable. “You should not discuss it,” a woman in a dirndl whispered to Kollmayer. “He’s writing it down.” Kollmayer was not dissuaded. She told me she “was not prejudiced against anyone” but was angry about the disorderly way the Syrians rode their bikes on the street (“I’ve almost been run over twice!”). She was angry about the amount of cash asylum seekers were getting from the government (“They should get a little bit, but not what they have”). She was angry that, according to her, the police were not allowed to talk about the crimes migrants committed (“My girlfriend’s daughter is a police officer, and they’re not allowed to report the truth”).
This last belief, that criminality among asylum seekers is being covered up, has become increasingly common. Social media and far-right websites abound with dubious claims about an epidemic of rapes and other crimes. The aim is to fuel fear. At an Alternative for Germany rally that I witnessed in Freilassing, a nearby border town that became a main migrant crossing point, one speaker referred to the “biological, totally natural sexual needs” of the men coming over the border. “I don’t want to know what will happen to our women and children when these men leave the camps.” Far-right groups reclaimed a Nazi-era slur — lügenpresse, or lying press — to argue that politicians and journalists were working in tandem to cover up the ugly truth. A growing distrust of state institutions and the media, caused by worry over the migrant influx and perceived sugarcoating in the reporting about it, made many people more receptive to misinformation.
In November, de Maizière tried to counter the rumor-mongering by announcing the initial results of a police study that found asylum seekers and refugees were, on the whole, not likelier to commit crimes than the general population. After the flurry of sexual assaults and robberies in Cologne on New Year’s Eve, however, far-right groups claimed vindication. An initial police report described the atmosphere on the night of the attacks as “relaxed.” By mid-March, 1,139 criminal complaints had been filed; 485 of them involved sexual offenses, ranging from sexual insults to groping and rape.
The police response was widely viewed as a cover-up, and the outrage was widespread. Alice Schwarzer, a prominent feminist, warned that Germany was “naïvely importing male violence, sexism and anti-semitism” and called the episode a consequence of “false tolerance” that endangers German democracy. Merkel, mindful of the public outrage, called for vigorous prosecutions of the offenders and pushed for legislation that would make it easier to expel foreign criminals. The episode, however, played into the hands of far-right groups seeking to both stoke and capitalize on Germans’ growing fear.
The day after I met Kollmayer, I heard more allegations about government cover-ups. It was a Saturday evening, and I went to a restaurant on Eisenärzt’s main street. I hoped to find a stammtisch, a regularly scheduled beer-drinking session that is often established among groups of friends in Germany. I had witnessed a few such gatherings in Freilassing. The stammtisch brings out Bavarian dialects, so I often had a hard time making out what people were saying, but I could pick out one incessantly uttered word: “refugees.” Generally speaking, the speakers didn’t seem pleased. In Germany, stammtisch talk is often considered beer-fueled blather not to be taken seriously. Horst Seehofer of Bavaria, with his blunt criticism of Merkel’s migration politics, often stood accused of trying to appeal to stammtisch opinion. This was meant as an insult, though I wondered why the stammtisch was so often dismissed. It seemed to me a place where people said what they really thought.
The restaurant in Eisenärzt was dimly lit, and only one of its tables was occupied. The two couples sitting at it, one of which ran the place, stared at me with somewhat puzzled expressions. With my dark beard, I often wondered if local residents took me for a Syrian. The looks I received weren’t always particularly warm. The scene seemed too sedate to qualify as a proper stammtisch, but it was too late to leave.
“Can I have a beer?” I said. A woman rose to serve me.
“Where are you from?” said one of the customers. He was tall, and his bald crown nearly reached the portraits of King Ludwig II of Bavaria on the wall above him. When I told him I was from the United States, he smiled as if this was O.K. The man, who later introduced himself as Michael Scholz, a produce-truck driver, told me there were too many migrants coming over the border. “This is why the Germans will get nasty again,” he said. He then put up his right arm in the manner of a Hitler salute so that there wasn’t any doubt about his meaning.
Eisenärzt, a village of 1,300 in Bavaria, became a reluctant host of asylum seekers. Credit Harf Zimmermann for The New York Times
Scholz went on to describe his grievances. One of his teeth had gone “kaputt,” and he needed a replacement. He had to pay 2,100 euros out of pocket, even though he’d been working and paying health-insurance premiums for decades. The Syrians living down the street, he said, would get the same care free, and as a result, his premium would rise. How was that fair? (Later, I learned that premiums for the publicly insured were set to rise in 2016, as they have in previous years, but the rise wasn’t because of asylum seekers, whose health care costs, while considerable, were covered by separate state financing.)
Scholz held up his beer glass. “Prost,” he said. “To Seehofer.” He looked at me. “Seehofer is good,” he said before drinking. That didn’t mean that Seehofer would get his vote, though.
Scholz told me he had not been an active voter, but the next chance he got, he would vote for the Republicans, a marginal party founded in Bavaria in the 1980s, whose ideology he accurately described as “pretty brown.” Scholz told me he had no problem with foreigners. In fact, older generations of immigrants from Turkey and the former Yugoslavia helped build Germany with their labor. Unfortunately, the Syrians would now destroy it. I asked him if he thought his views were typical or if he considered himself an extremist. His companion said she worked in a paint store in Freilassing. A lot of customers shared these thoughts, she said. Scholz added, “When the stammtisch explodes, then you’ll see what happens.” He paused and said: “Wir sind das Volk.”
A few months later, in three state elections held in March, Alternative for Germany did very well. In the eastern state of Saxony-Anhalt, the party came in second, earning 24 percent of the vote. In Baden-Württemberg and Rhineland-Palatinate, both in the west, it earned 15 and 13 percent. Fear of migrants had turned the far right into a viable political movement; the stammtisch had made itself heard.
One morning as spring approached, I met Mayor Kamm in his office in Town Hall. Several months had passed since we first met, and new asylum seekers were still arriving in town.
Twenty Pakistanis, he told me, were in the process of moving into a guesthouse in one of the villages in the municipality. At the same time, many of the Syrians in Eisenärzt had begun to receive refugee status. This meant that it was time for them to move out: to find apartments, look for jobs and begin new lives in Germany. Many Syrians left town to join friends and relatives in bigger cities and were replaced by new Syrian arrivals.
Others wished to stay in Siegsdorf Municipality, the only German home they knew. This presented a set of entirely new challenges. The mayor was considering ways to provide low-income housing and how to ease access to the job market. At the same time, he still seemed worried about the local mood.
He told me about one nearby municipality where residents got into an “open confrontation” with elected officials over opposition to a residence for asylum seekers. By contrast, things in his town were quiet, he told me, but this could change instantaneously if one of the migrants did “something bad.” I asked the mayor what he meant. “A rape,” he said in a matter-of-fact manner.
A few weeks later, after the attacks in Brussels, Graf von Rechberg noticed what he called “a greater wariness” among his congregants. On Holy Thursday, he gave a sermon on how Christians ought to confront the darkness and evil implicit in the Brussels attack. He advised congregants to pray for peace, to avoid the temptation to hide from outsiders, to accept refugees. During the service, Graf von Rechberg washed the feet of a Pakistani asylum seeker, as Jesus had washed his disciples’ feet before the crucifixion. When I spoke to him later, Graf von Rechberg still seemed resigned to a darker future for Germany. The social problems and fanaticism that led to the attacks in Brussels, he told me, were perhaps unsolvable. Still, it was everyone’s spiritual obligation to try. When I asked him if he visited asylum seekers to hand out gifts after the Brussels attack, as he did following the Paris attack. Graf von Rechberg suggested the violence had become grim routine. “I can’t go by after every attack,” he said.
At the Mallersdorfer Sisters’ former residence in Eisenärzt, Yasser continued to try to transition to a normal life in Germany. In December, Beni Beilhack accompanied Yasser to his asylum interview in Munich. The questioning lasted about an hour. Had Yasser witnessed an aerial bombardment? (No.) Had he ever fought for Bashar al-Assad? (No.) Had he fought for ISIS? (No.) A few weeks later, Yasser received notice: He had been granted refugee status.
Yasser, who was still missing his wife and wondering how long it would take to bring her, was ambivalent about the news. Beilhack seemed to try his best to cheer him up. He helped Yasser file the application to bring her to Germany and found him a modest one-bedroom sublet in Eisenärzt.
After he arrived in his new apartment, Yasser stood on his balcony and took in the view: the neighboring houses and the pine-tree-covered hill beyond them. It was very quiet. Yasser joked with Beni about disrupting the serenity. He would raise chickens on the balcony and invite all the Syrians over for a party. Yasser grabbed Beni’s son, Luca, by the hand and mimicked a foot-stomping Syrian dance. “Allahu akbar!” he whispered as if screaming. “Police coming in one minute,” he added wryly.
After Beni and Luca left, Yasser didn’t bother to unpack his bags. He sat down on the couch and gazed at the orange shag carpet. I asked him how he felt in his new home. This was not his home, he told me. Syria was his home. He believed Germany was far more hospitable than other European countries, but still, he would always be a foreigner. When people saw him, they thought: “Nicht aus Deutschland,” he told me. Not from Germany.
Yasser then stepped out onto the balcony for a cigarette and peered at the lawn below. One neighbor, an old man in his slippers, appeared on the path next to his house. Before turning the corner, the man glanced up at Yasser for a moment and then looked away, saying nothing.