Merz Treads Uneven Ground

Germany’s new Chancellor Friedrich Merz, sworn into office earlier this month, requires to summon all his political prowess to maintain the delicate balance with his Christian Democratic Union’s Bavarian sister grouping, the Christian Social Union, and the centre-left Social Democratic Party in the coalition cabinet. Parliament endorsed Merz only in the second round of voting. Some of his party members or those from the coalition partners resented him in the secret ballot, conceding a majority only in the next round. In a display of inner-party democracy, the recommendation to join a coalition led by the Conservatives, the Social Democratic Party’s 358,000 members in April were asked to vote on the move. A good majority of them endorsed the proposal. 

As a result, the outgoing Chancellor Olaf Scholz’s Social Democrats led his party to join a new coalition government as a junior constituent, paving the way for Merz’s election. The early polls came after Scholz fired Finance Minister Christian Lindner, leader of the pro-business Free Democrats. The differences in the coalition were over ways of handling the troubled economy, fuelled by a steep oil price hike in the wake of the war in Ukraine. The European Union’s largest economy has borne the brunt of soaring energy prices, an extra $1.5 trillion over the pre-2022 prices. Reflecting pre-poll surveys, the election produced a hung parliament, with no single group securing a clear majority on its own. In keeping with past practices, the largest grouping, CDU, staked a claim for heading the new government. 

Unhappy wing

Against the background of the SPD having suffered its worst election performance in the post-World War II years, its youth opposed participation in the Merz-led government. Although nearly 85 per cent voted, only 56 per cent of the organisation’s members cast their ballots. What brought the three parties together was their common desire to keep the far-right, Alternative for Germany (AfD), away from power. Vehemently anti-immigration, the AfD obtained the second-highest votes in the election. In the last three decades, German people experienced single-party rule, multiparty governance and grand alliances with the top biggest groupings sharing power. The results were mixed; many people were disappointed.

 The last three years witnessed the European Union’s backbone economy in deep trouble. Sluggish economy and employment lines are growing. The overall scenario continues to look bleak. The mess is deepening amidst speculation whether the great, speedy German recovery recorded in the post-World War II decades could be replicated in the 2020s. Munich hosted the 1972 Olympic Games, which the world saw as the German people’s willpower to stage an economic comeback after their devastating defeat in World War II. In fact, Germany’s wartime ally Japan had organised the quadrennial Olympiad in Tokyo in 1964. 

The sporting spectacles were the defining statements on the dazzling economic comeback of the two Axis powers that both had suffered such huge defeats by the time the war ended in 1945. Subsequent decades added to German technological and production qualities, as the country emerged as Europe’s largest economy. The latest edition of the CDU-SDP has lost its lustre. The combine’s image no longer excites popular expectations the way it did earlier. If Germany sinks, the EU, too, will find itself in a grave crisis. Cheap Russian oil dried up three years ago after Russian troops invaded Ukraine in February 2022. Russian oil accounted for 55 per cent of Germany’s energy imports. 

Sanctions on Russian supplies fuelled oil prices that hurt most of Europe. The sharp supply shortfall not only raised living costs but also boosted inflation rates, which inflicted the biggest burden on Germany. In the American dictionary, business is business, and profits take precedence over goodwill for long-term interests. This was amply reiterated when American oil was supplied to Europe, but at high prices. The transactions swelled the oil producers’ profits chest but pinched the clients’ pockets deep. There was no heart for reduced tariffs, which laid bare the practical aspect of diplomacy, economic profits and the like. Seeing and experiencing the harsh reality of “national interests” and the bitter truth of diplomacy, often veiled in formalities and niceties, came out in the open in full view of the global public.

German products, including prestigious car brands, suffered setbacks. Every fifth car that rolls on global roads is made in China, while Germany’s overseas market has shrunk. German car sales recorded less than what was achieved three years ago. Even if chorusing US-composed tunes that translated into sanctions against Russia did not make any significant impact on the invaded Ukraine, nor was the US economy adversely affected as a direct consequence of the war. Ukraine has suffered huge losses on all fronts, despite the bucking up the joint US and major European powers in the first two years.      

Despair grips

European people’s views on the Ukraine war have been one of despair, and call for ending it quickly, even if it means allowing the latest territorial status between the warring parties to remain intact under a ceasefire. When translated into simpler words, the stand would be to allow Russia to keep seized Ukrainian territories and assure that Kyiv would neither apply for NATO membership nor would it be given. Germans realise the futility of continued support of the US initiative in Ukraine, now that the Donald Trump administration has all but abandoned the original objectives in its undisguised haste to end the war and enable Washington-Moscow cooperation to take a positively new course after the war-affected setbacks. 

A division in the outlook of the Western capitals is clear. Economic troubles stare at not only Germany but the rest of Europe. Hungary has been taking a stance different from other European countries. Voices from other capitals also call for reducing their over-reliance on the US.  Hungary has for quite some time been taking a stance different from other European countries on ties with Russia and other major issues. 

Spain’s Prime Minister is scheduled to meet Chinese President Xi Jinping in September. Brazilian President Luiz Inacio de Silva is currently on a four-day state visit to China. Hence, the shifting sands of power equations indicate that not all realistic hopes are lost for a Germany known for its shock-absorbing capacity as a formidable quality to reckon with. In the past, Germany put into action a vast reservoir of energy and efficiency to regain lost ground in infrastructure-building and enabling the factories to keep going. Unification with East Germany had put tremendous strains but the country absorbed the initial difficulties.

(Professor Kharel specialises in political communication.)