It’s worth noting that the incoming German leader has no prior government experience. Friedrich Merz, whose Christian Democrats are poised to lead the next government, takes over during a period of widespread instability.
He’s inheriting an economy struggling from a decade of insufficient investment and entering its third year of economic downturn, a social climate worsened by individual acts of violence, and the growing influence of the far-right Alternative for Germany (AfD). Crucially, he also faces a breakdown in relations with the U.S., a long-time security partner since World War II.
Merz likely identifies as a traditional conservative, similar to Ronald Reagan or George H.W. Bush, upholding traditional social values and the established post-war security and political structures that have kept Germany aligned with the Transatlantic alliance.
After Trump’s re-election in November, Merz expressed confidence in their ability to work together, envisioning two like-minded individuals focused on deregulation, tax cuts, and combating “woke” ideologies. However, the aggressive stance taken by Trump’s representatives at the recent Munich Security Conference, including their praise for the AfD, has altered that perception.
Merz, 69, who has combined his political career with a role as Chairman of Blackrock’s German operations, is eager to act swiftly. As he stated during his campaign, “the world isn’t waiting for us.” He emphasized that Germany cannot afford to spend months debating coalition details while the future of Ukraine is being determined by Trump and, as some believe, his influencer, Vladimir Putin of Russia.
Kaja Kallas, the E.U.’s chief diplomat, echoed this sentiment, hoping for a swift formation of the new government, stating the urgent need to “move on with decisions at the European level which requires German participation.”
With Emmanuel Macron facing challenges and Keir Starmer’s recent actions, Europe is trying to convince Trump to reconsider his apparent support for Putin’s stance on Ukraine. The French and British leaders have been aligning their strategies, emphasizing the need for discreet diplomacy. However, immediately following his election victory, Merz seemed to adopt a more adversarial approach towards the White House.
“My top priority will be to strengthen Europe as quickly as possible so that, gradually, we can achieve genuine independence from the USA,” Merz declared on Sunday, even before the final vote count was in.
Some questioned whether this was another instance of impulsiveness, a trait even those close to Merz recognize as a flaw. Yet, he doubled down on his position the following morning: “Now more than ever, we must put Ukraine in a position of strength. For a just peace, the attacked country must be part of peace negotiations.”
To give weight to these statements, Merz needs to demonstrate a willingness to increase Germany’s defense spending through further borrowing. Despite NATO members agreeing a decade ago to allocate a minimum of 2% of GDP to defense, Germany has yet to comply. Raising this to 2.5%, let alone a higher figure, would require tens of billions. To achieve this, the incoming government would need to revise its “debt brake” that imposes strict limits on public borrowing.
Merz seems prepared to do so, potentially with the backing of the center-left Social Democrats. The outgoing SPD suffered a significant defeat, falling to a historic low in third place. They are now expected to play a minor role in a center-right government. However, some of Merz’s policies, particularly his economic reform plans involving welfare cuts, tax breaks, and stricter measures against illegal immigration, may face resistance from the SPD.
In one aspect, the disagreement with Trump complicates Merz’s job; it serves as a warning to mainstream politicians on both sides of the spectrum about the potential consequences of failing to form a stable coalition. Buoyed by their best-ever result, capturing 20% of the vote, and supported by endorsements from Elon Musk and figures within the Trump Administration, the AfD is poised to exploit any future crises the new government encounters.
The far-right in Germany is confident that its moment will come, again.