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Sunday’s federal election in Germany will take place in a climate of acute concern about the unfolding risks to the nation’s security, liberal democracy and economic wellbeing. It is disorienting for Germans that the US, a mentor and ally for eight decades, has turned under the administration of Donald Trump into a bully contemptuous of the democratic model that Germany built under American guidance as it recovered from the physical ruins and moral disgrace of 1945. The parties that form a post-election government will have no time to waste in addressing the threats to Germany’s security, democracy and economic dynamism.
Germany has considerable strengths to draw on. The Federal Republic is one of the world’s most resilient, mature democracies, framed by the rule of law and backed up by an energetic civil society. It has flourished since 1949, riding out the cold war, domestic terrorism, the tasks set by reunification after 1990 and even, in recent times, alleged coup plots. On the economic front, the difficulties that face German manufacturing should not obscure the successes of its services sector and of its ever resourceful Mittelstand companies.
Although long-standing issues with the country’s migration and asylum policies have been prominent in the campaign, the gravest concern is defence. American unreliability points to an urgent need for more European self-reliance. Germany’s next government must assume the responsibilities incumbent upon it as the EU’s largest economic power. If the US abandons Europe and Ukraine to face Russia alone, Germany should resist any temptation to cut a deal with Vladimir Putin. Any such arrangement would provide an entirely illusory security as well as shattering trust among Germany’s neighbours.
The requirement will be to raise defence expenditure in co-ordination with Germany’s allies. This appears to be understood by the Christian Democrats — most likely to be the senior party in the next government — and the Social Democrats and Greens, with either or both of which the CDU may form a coalition. It is also necessary to reverse the severe under-investment in infrastructure, digitisation and other shortcomings of Angela Merkel’s 2005-2021 chancellorship.
However, the three mainstream parties disagree over how to pay for such measures, with the CDU favouring larger tax cuts than the SPD and Greens, and other frictions certain to emerge in coalition talks over social spending levels and debt financing. What is essential is that talks among moderate parties should not break down, as they did last month in Austria, opening a potential door to the far right. In Germany, the taboo remains strong against permitting a formal government role for the far-right Alternative for Germany, party. But it would be almost as calamitous if the CDU were to feel tempted to form a minority government relying on parliamentary support from the AfD.
Whoever forms the next coalition must take courageous steps to revive the economy. Having registered negative growth for two straight years, Germany has underperformed the US and even the Eurozone as a whole. This bleak situation calls for market-driven reforms to boost innovation and competitiveness, and for the abandonment of the ultra-cautious, constitutionally enshrined “debt brake” that has suppressed domestic investment. The main parties are inclined to take this step, but the hesitancy of Friedrich Merz, the CDU leader, gives cause for concern. Moreover, the prospects for changing the constitution will depend on the election result and which parties pass the threshold for winning Bundestag seats.
This election could either push the country on to a more prosperous and secure path, or perpetuate its drift. Germany — and all of Europe — needs the former to prevail.
