02-05-2025
The five big challenges facing Germany's next chancellor Friedrich Merz
As expected, the
SPD's membership have voted in favour of entering into coalition with the CDU/CSU
, finally clearing the way for the latter's Friedrich Merz to be elected Chancellor in Bundestag.
He should scrape through. Yet between them, the CDU/CSU and SPD have an uncomfortably thin majority of 13. So it will only take a couple of SPD rebels turned off by
Merz' recent flirtations with fascism
for his chancellorship to get off to a very wobbly start indeed.
A full six months since their outgoing
Chancellor Scholz torpedoed his own administration
, however, and after keeping everyone waiting for weeks, SPD MPs know that any further delay would be political suicide. And that Germany needs a fully-functioning government again ASAP.
It needs this government to hit the ground running, too – even though, despite advanced age and personal wealth, Merz doesn't have much of relevance to being Chancellor on his CV. He left politics in the mid-2000s without ever having held office and has only been back on the scene in opposition for a few years. His amateurish antics in recent months testify to his lack of experience.
So good old Freddy is going to need some real beginner's luck to get a handle on the intractable problems Germany is facing. In fact, to use a comparison his initials invite, he's going to need to be political rock-star of the order of Freddie Mercury to handle this overflowing in-tray well.
READ ALSO:
What's first on the new German government's to-do list ahead of summer?
Here are the five most urgent files requiring his attention.
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1. The economy
Lacking a track record in government, ex-Blackrock executive Merz has traded on his business credentials. He bills himself as a high-flyer (quite literally: he has a pilot's licence) with an understanding of economic affairs not shared by the bleeding-heart socialists now in his coalition or the dogmatic Greens. Freddy, quite simply, thinks he can rock the economy.
But he's playing to a tough crowd. After almost five years of stagnation and recession,
growth has flatlined
,
unemployment is creeping up year on year
, and corporate profits are way down –
especially in the all-important car industry
. Worse: none of these figures take into account Trump's tariffs.
Shipping containers sit on a large ship in Hamburg harbour. Photo: picture alliance/dpa | Marcus Brandt
The reasons for Germany's woes are clear enough: outdated industries, poor infrastructure, a decreasing number of hours worked. Also, there is our pronounced tendency to national depression. As one of Merz' CDU predecessors as Chancellor, 'Father of the
Wirtschaftswunder
' Ludwig Erhard, once put it: 'Economics is 50 percent psychology.'
A
real
Ludwig
fan
, Freddie is probably hoping that his warm-up act –
that emergency €500-billion package
– has got everyone in the mood for take-off and set him off to a flying start.
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2. Immigration
Immigration is another big issue facing Friedrich Merz – but not in the way he thinks. Merz, of course,
campaigned as a hardliner on asylum
, channelling Trump with his promises to "close the borders from day one".
Unlike The Donald, however, Freddie doesn't have the presidential authority to rule by decree (though his new Interior Minister would certainly like him to).
Also, his SPD coalition partner, the constitutional and European courts, and neighbouring countries like Poland and Austria won't let him kick migrants out with the butt of a rifle or fly them out to Rwanda. (This is Europe: Italy's Giorgia Meloni hasn't even been allowed to send them to Albania.)
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So having got expectations up, Merz' real challenge will be to not do or say anything stupid about immigration while keeping the crowd entertained. Changing tune will be made easier by the fact that the previous administration has already taken care of a lot of the dirty work: Germany has been policing its Schengen borders to the maximum
since last year
and quietly supporting grubby EU pushback deals with neighbouring states like Turkey and Tunisia.
READ ALSO:
How is Germany's future government planning to shake up immigration?
What Germany's new coalition pact means for foreign residents
As a result of this, our weak economic performance, and the increasingly xenophobic vibes we're giving off, immigration to Germany
– both illicit and wholly legal – is already falling. Yet will Freddie be able to resist his frequent urges to play 'Radio Gaga' here – especially when the next random attack is perpetrated by an asylum seeker or foreign-born terrorist?
3. Healthcare
Although the matter got little attention during the fraught election campaign, Germany is on the cusp of a healthcare crisis. Don't worry: this isn't the UK, so there'll be no battlefield medicine in overcrowded A&E departments just yet – and no crazy cuts to crucial research like in the US.
What we are already seeing, however, are
waves of hospital closures and a very serious shortage of doctors
. At the same time, Germans are getting older, frailer, and unhealthier – and have a stubborn tendency to visit doctor's surgeries too often and get themselves written off sick for too long. Given the state of our economy, we can no longer afford this, so
novice Health Minister Nina Warken will now be charged with making them stick to one GP
. Good luck with that.
A GP sits at his desk in Germany. Photo: picture alliance/dpa/dpa-Zentralbild | Monika Skolimowska
Then there is the new
electronic patient record
, the launch of which has been hurried along by outgoing Health Minister Karl Lauterbach despite serious concerns about data privacy. This is a cybersecurity scandal waiting to happen – and indeed, hackers managed to breach the system just days after it launched.
Another area requires urgent action: on current trends, the
Pflegeversicherung
system of funding social care will be on its knees by next year. So Freddie is going to need to find another load of free money from somewhere in order to avoid a sheer heart attack.
READ ALSO:
What to know about the roll out of Germany's electronic patient file
4. Defence
On the face of it, Merz has already dealt with this thorny issue: his
surprise pre-government deal to ditch the debt brake
allows for more or less unlimited defence spending. Seemingly, this secures our plans to rearm and sends a signal to both Putin and Trump that Germany's days of being a pushover and a freeloader are well and truly over.
The reality, however, is that even with SPD safe-pair-of-hands Boris Pistorious remaining at the Defence Ministry, the parlous state of our armed forces will still require Merz' executive attention. For unless there is a total reform of procurement, billions will be spent without much to show for it.
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Also, wishy-washy plans to kindly ask 18-year-olds to maybe, possibly, please consider service won't be enough to stop the continued decline in the number of armed personnel we can field. As a self-proclaimed man of business with whom the buck stops, Merz will be expected to personally ensure that we get real bang for said buck – and our boys back into uniform.
READ ALSO:
What will Germany's new military service look like - and who will it include?
5. Foreign policy
One way Merz might well be able to speed up rearmament is by cooperating with NATO partners on a European level: if we all place bulk orders for tanks and shells, for example, the process will be cheaper and quicker.
And Merz – who spent a term as an EU parliamentarian back in the early 1990s – looks more aware of the importance of international relations more than his predecessor Scholz, who seemed happy to let Annalena Baerbock take care of foreign affairs while he got on with… well, whatever it was he was doing between 2021 and now.
A float at the Düsseldorf Carnival parade portrays German Chancellor Olaf Scholz on a sunken ship. Photo: Ina Fassbender / AFP
As a result, Germany has sorely neglected its relations with close partners of late – to the extent that, last year, they snubbed a French offer of nuclear protection and even forgot to invite Poland to Joe Biden's Berlin send-off. In a sign of his interest in rekindling cross-border approaches, Merz has, as the first CDU chancellor since the 1960s, insisted that his party get the Foreign Office.
Nevertheless, after five years of self-obsessed behaviour, Germany is no longer as well-liked abroad as it needs to be. So Freddie will need to get things started with a barn-storming number, here.
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Outgoing chancellors get to request the music the Bundeswehr's band plays at their leaving ceremony. Schröder went for 'My way', Merkel Hildegard Knef's
Für mich soll's rote Rosen regnen
.
Olaf Scholz has resisted the temptation to troll the successor he calls '
Fritze
' ('Freddie') with Queen numbers like 'Another one bites the dust' – all he wants is a little
'Respect' by Aretha Franklin
. Yet although he is soon to be champion, my friends, Freddie Merz will still need to pull off a real star turn.
