Speaking at a conference of his centre-right CDU party on 23 August, German Chancellor Friedrich Merz warned that the German welfare system in its current form ’can no longer be financed with what we produce in the economy.’ He also stated that Germany is in a structural crisis after three years of recession and slipping industrial competitiveness.
Merz’s words signal that the so-called grand coalition of CDU/CSU and SPD is fully aware of how bad the situation is, however, given that both parties want to avoid losing any more voters, it is unlikely that substantial reforms were put on the agenda.
In a situation when the German leadership must as soon as possible find a solution to lower a €172 billion budget deficit, popularity issues simply overwrite common sense and, this shift shows the best that tackling real problems seems secondary to the desire to keep power. At the same time, it should be noted that this phenomenon is absolutely not Germany-specific, but typical across the EU, adding that, as of now, crises represent not only a challenge, but also a special approach to governance within the EU.
’Germany has the third largest economy in the world and was arguably the first modern welfare state. Yet poverty rates have risen considerably in the last two decades, with the most recent official data estimating that one in seven people (14.4 percent of the population – some 12.1 million people – living in monetary poverty, that is with a standard of living below the poverty line. (…) The situation has become more pressing in recent years, as rapid inflation reached a generational high in 2022 and 2023, hitting Germany’s low-income households hard. (…) Despite its significant resources, and notwithstanding efforts to make improvements, Germany’s social security system – and the level of financial support it provides – is proving insufficient to ensure people, particularly these groups, enjoy an adequate standard of living.’, Human Rights Watch says in its report on poverty in Germany’s social security system which is based on interviews with directly affected individuals, analysis of available data and official statistics.
Following the crisis caused by the COVID-19 pandemic, to continue to be the EU’s top economy, Germany needed a strong and urgent recovery, more than any other EU Member States. In addition, both the EU and Germany in particular, also needed to find adequate answers to the energy market disruption caused by Russia’s invasion of Ukraine in 2022. In terms of these very serious and compicated issues, both the EU as a whole and particularly Germany have failed to find the right response. The RePowerEU plan, together with national plans, launched by the European Commission in order to get out of the crises, does not work.
In terms of Germany that means that the German Recovery and Resilience Plan (a central part of the EU’s REPowerEU chapter) seems to be unable to meet the initial goals that is to introduce new measures in various fields including green transition and digital transition to save energy and diversify energy supplies which will bring positive change not only for Germany but for EU citizens, businesses and the EU at large, given the spillover effects.
In concrete figures it means that a €32.3 billion plan simply disappears into thin air without any significant results for Germany and the bloc.
The situation in Germany is basically the same as it is at EU level meaning that both Germany and the bloc are facing a deepening political, economic, and moral crisis, with shrinking economic output and decreasing competitiveness, coupled with growing social discontent, while political leaders concentrate their efforts on retaining their power rather than addressing real problems. Furthermore, both German and EU foreign policy have become subject to a warmongering rhetoric over Ukraine which is disproportionate frightening -, with the sole function of distracting attention from internal problems. Like Berlin, the European Commission also communicates with empty slogans, while moving further and further away from the reality. On behalf of the citizens it feels like the power centres were more and more disconnected from them.
It should be noted that while Germany’s leadership often addresses other countries, including EU Member States from a superior position, the country’s economy and social model is being shaken to its foundation.
The EU is just the same as Germany as Brussels has taken legal action against Hungary and Poland for alleged violations of the rule of law, while a number of EU bodies are affected by corruption as we have seen in cases such as the Qatargate scandal in the European Parliament and certain appointments at the European Commission not to mention the overall democratic deficit which has become commonplace in the entire bloc.
Instead of long-term solutions that truly consider the interests of citizens, the ruling elite not only in Berlin but also in many other EU capitals, including Brussels, the heart of the bloc, prefers short-term political survival. Prompt responses to manage challenges have replaced not only the search for causes but also long-term strategic planning. The reason for this is simple: identifying the root problem and developing a strategy accordingly would result in unpopularity, – something that politicians of our time cannot afford. However complicated the situation may be, the explanation is really that simple.
Truth is being replaced by reputation and popularity issues, while farsighted policy and careful planning are being substituted by one-minute political marketing and opaque decision-making.
Raising hypocrisy to EU level can be named as one of the key ’achievements’ by the European Commission led by Ursula von der Leyen: while talking about values, the basic need to maintain the balance in the power system with sophisticated tools of political marketing prevail in all areas and in all respects. That is why no strategic decisions are being made in the EU, instead, European citizens are bombarded with empty promises on all issues ranging from Ukraine to the Green Transition and enlargement.
Short-term thinking and, consequently, the lack of a long-term vision risks triggering a civilizational crisis in Europe, in which politicians no longer act but only react, and voters are no longer decision-makers but merely contributors to politicians’ reactions since they are nothing but target groups for the ruling elite’s political messages. The voice of the people, democracy, and the noble idea of European identity are deprived of their substance and becoming meaningless – and this, among other aspects, can be an explanation to the rise of radical political groups such as Germany’s AfD.
The situation has reached the point where we need to say that while Europe does not lack resources, it lacks political, moral, and intellectual courage, which, if European leaders had these values, would enable them to face problems with confidence. However, they fear unpopularity above all, while citizens hate uncertainty above all, including uncertainty about their livelihoods, and this is a combination that has led to an EU which is afraid of the truth, thus completing the vicious circle of a political marketing and popularity-driven ’democracy’ where the perceived gap between the power centres and citizens is growing bigger and bigger each and every day.
