Berlin Cable

The coalition-building after the election on February 23 is likely to become a moment of truth.

Elon Musk has been trolling Germany’s parliamentary election campaign during the holidays. His AI-supported interventions are unlikely to have much effect, but they remind the country that it needs new ideas—which so far are lacking.

The break-up of Chancellor Olaf Scholz’ coalition government was expected, but is still taking place at an extremely critical time. Its successor will have to set clearer priorities—and find greater fiscal space.

The pro-business Free Democrats are likely to leave the government early. It may be party leader—and finance minister—Christian Lindner’s last consequential mistake for a while.

Politically, the Scholz government seems finished, even if it manages to drag on for another year. Germany, which derived much of its foreign policy stance from its seemingly unshakable “stability,” does not look so stable all of a sudden.

Germany is spending the summer trying to temporarily ignore the situation in Ukraine. That’s likely to backfire. Rather, the German government and the rest of Europe should signal stronger, not weaker, support for Ukraine.

Scandals have only dented, but not eroded support for Germany’s far-right Alternative für Deutschland. In September, the party could come close to political power at the regional level. The case for banning it is getting stronger.

With his second visit to Beijing to see Chinese President Xi Jinping, German Chancellor Olaf Scholz set himself up for a failure. In contrast, Vice Chancellor Robert Habeck, when visiting Ukrainian President Volodymyr Zelensky three days later, had a firmer grasp of realities.

It’s not much of a secret that Emmanuel Macron and Olaf Scholz are very different characters. Their deepening rift is damaging the Franco-German relationship—and Europe.

The German government has straightjacketed itself by a return to the “debt brake,” pursuing a stringent fiscal policy at a time when the country is trying to fight its way of out a recession. Two of three ruling parties think the approach is wrongheaded.

2024 will likely test Germany when it comes to its two most important defense and security tasks: helping Ukraine and improving the Bundeswehr.

Just before passing its halfway mark, the coalition government of Chancellor Olaf Scholz has been hitting the financial buffers. Sadly, a general fiscal rethink is unlikely.