Nit na osnovi dobrega članka Isabelle Weber in Toma Krebsa v Foreign Affairs – »What Germany’s Economy Really Needs: Merz’s Plans for Rearmament and Austerity Won’t Work«. Merzeva vlada dela natanko to, kar so počele (desno in levo) sredinske vlade pred njo – na izzive časa se odziva s politiko varčevanja pri ljudeh in s fokuisiranjem na investicije, ki ne prinašajo novih delovnih mest (zelene investicije in investicije v orožje). Najboljši recept za polnjenje jader populističnim strankam levo in desno od centra.

Germany is facing its deepest economic and democratic crisis in decades. Real wages are down, the far right is rising—and the new government has no plan that speaks to the scale of the challenge.

Germany’s economy has stalled. After six years of stagnation, real GDP growth has plateaued and is almost ten percent below where it should be. The 2022 energy shock triggered the largest one-year drop in real wages since World War II.

Despite some gains in 2024, real wages are still eight percent below the pre-pandemic trend. Economic insecurity is fueling political extremism. The far-right AfD just finished second in federal elections—and since jumped to the first rank in some polls.

The AfD includes prominent neo-Nazi members and is overtly hostile to the liberal principles that Germany has sought to enshrine since World War II. Its growing popularity is not just Germany’s problem—it threatens the democratic core of Europe.

Yet the response of mainstream democratic parties has been woefully inadequate. Olaf Scholz’s SPD-led government applied fiscal austerity in both 2023 and 2024—deepening stagnation and ultimately collapsing under the fiscal straight jacket.

Friedrich Merz’s new CDU-led coalition amended the constitutionally enshrined debt brake to allow unlimited military spending—but capped the expansion of deficit spending on infrastructure and climate investments. Merz declared: “Germany is back.” But is it?

Merz champions “trickle-down economics.” The promise: defense spending is good for workers. But while arms manufacturer Rheinmetall’s profit margins skyrocketed, its workforce in Germany grew just 25%. A tank factory in Görlitz replaced a train plant & halved the # of jobs.

The message to workers? Cuts to social benefits. Scrapped green subsidies. Privatization. Members of Merz’s own party complain: “No strong voice for labor” in the cabinet. VW plans to slash its German workforce by a 1/4. Defense won’t make up for ailing competitiveness.

This agenda will not restore trust in democracy. Only 30% of Germans believe the new government will bring positive change. Merz holds the lowest approval rating of any incoming postwar chancellor and is the first to have failed in the first confirmation vote in parliament.

Germany needs bold action:

• Raise wages
• Stabilize cost of living
• Green industrial policy for good jobs
• Comprehensive reform of fiscal rules

Without a credible alternative, the center will continue to collapse—& the extreme right will fill the vacuum.

Vir: Isabella Weber