Garvan Walshe is a former national and international security policy advisert to the Conservative Party

The day after Trump won the US presidential elections, Germany’s government collapsed.

Chancellor Olaf Sholz fired finance minister Christian Lindner, causing Lindner to withdraw his Free Democrats from Germany’s three-way coalition, depriving it of a majority.  In deliberate German style, the “snap” elections were to be held in March, but it now looks like they’ll be brought forward to February 23rd. In the meantime, a rump coalition of Social Democrats and Greens will soldier on as a minority government.

It’s the best thing to happen to Germany in years.

Angela Merkel had ruled for sixteen years through stolid centrism during which problems were allowed to accumulate out of sight. Olaf Scholz, though from a different party, was elected as a continuity candidate, but if he largely continued his centrism he lacked her political skill. Merkel knew when to bend under pressure, even if she didn’t always do so wisely. Scholz was merely stubborn. Though Lindner is not an easy man to deal with, and got more difficult as his party began to drop in the polls below the 5% threshold for entry into parliament, Scholz also fell out with both co-leaders of the Green Party and the President of France.

Merkel bowed out with her reputation at a high, Scholz would inherit the consequences, which relate to the essential difficulty of running a country that is both Europe’s car industry powerhouse and its most radically environmentalist large country.

Following the Fukushima nuclear accident, caused by an earthquake in 2011, she announced the closure of Germany’s nuclear industry, leaving the country even more dependent on Russian gas. Renewables production lagged, as bureaucracy stalled wind power installation. Russia’s takeover of Crimea in 2014 did not force a change in German policy.

Instead, the Nordstream 2 pipeline, to allow Russia to supply Germany while bypassing Poland, was completed. 

She let the German army rot through severe underfunding, part of an aversion to government debt so severe it has also left the country with famously late trains and decaying schools.  Now, the car industry’s about to undergo radical change: large carmakers are switching to electric vehicles, and have no need for the medium-sized firms in the internal combustion engine supply chain.

If energy prices rose due to an external shock (however predictable Russian aggression in fact was), the destruction of the internal combustion engine was the result of deliberate government policy.  That policy might be justified as necessary to deal with climate change, but the German government has even less excuse to be caught by surprise.

To this must be added the migration crisis. I still defend Merkel’s decision to allow in two million Syrian refugees. The filip this gave to the Alternativ für Deutschland (AfD) had to be set against both the inherent merits of this humanitarian gesture, and Germany’s labour shortage. Yet the German economy has found it difficult to absorb the refugees because its inflexible labour market has struggled to employ them where they, largely members of a relatively educated Syrian middle class, might be most productive.

The AfD has now moved on to a new target: the green authoritarianism it attributes to economy minister and Green co-leader Robert Habeck (a scheme to require the installation of heat pumps proved particularly unpopular); this together with disillusionment with economic progress in the former East Germany, has driven it to new levels of support.

It only fell below the 20% because it was joined by another “conservative left wing” populist movement led by Sara Wagenknecht, who began her career by joining the ruling party of the German Democratic Republic — in 1989. In some former East German states the anti-system vote, comprised of the AfD, Wagenknecht’s BSW, and Die Linke, the successor of the East German Communists, make up almost half of the vote (in Thuringia they are the majority).

In the lead however is Merkel’s centre-right CDU/CSU now led by Merkel’s longtime rival Friedrich Merz, a former banker, more willing to shake things up — and perhaps more able to handle Donald Trump than either of his predecessors. Merz worries about Germany’s declining economic performance, has  promised to revise Germany’s “debt brake” (currently enshrined in its constitution), and is open to increases in defence spending. Here he is catching up with the German public, 65% of whom now favour a defence budget of at least 3% of GDP. 

The man who suggested it was perhaps surprising: Boris Pistorius, defence miniser in Scholz’s government, but also Scholz’s rival for the Social Democrat nomination for Chancellor. Pistorius is considerably more popular than Scholz and would pose a tougher challenge to Merz. Even if a Pistorius led SPD can’t beat Merz, it could well force a tougher bargain in coalition negotiations.

Another “grand coalition” between  the CDU/CSU and the SPD appears the most likely outcome, because the CSU (the CDU’s Bavarian sister party) has set itself against a coalition with the Greens, though post-election arithmetic has a way of dispensing with pre-election promises not to cooperate. The right leaning liberals of the FDP are unlikely to make it into parliament, while the AfD are too toxic to be coalition material.

The long Merkel era, its sixteen years extended by three years of added time under Scholz is coming to an end. Let’s hope its replacement will provide Germany with the change it needs.

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