Friedrich Merz Takes Charge: A New Era for Germany and Europe
Following the triumph of his conservative alliance in the recent elections, Friedrich Merz is poised to become Germany’s next chancellor. He does not mince words when addressing the monumental challenges that lie ahead, particularly in light of the unpredictable nature of U.S. foreign policy under President Donald Trump. Merz has articulated a sense of urgency, stating, “It is clear that the Americans, particularly those in this administration, do not hold Europe’s fate in high regard.”
He further emphasized the gravity of the situation, declaring, “This is truly five minutes to midnight for Europe.” Merz expressed concerns about the upcoming NATO summit in June, questioning whether leaders would still be discussing NATO in its current form, or if there would be a pressing need to accelerate the establishment of an independent European defense capability.
These sentiments are particularly striking coming from Merz, the leader of the Christian Democratic Union (CDU), as his party has historically viewed the United States and NATO as the cornerstone of security. Having chaired the Atlantic Bridge—a cross-party initiative uniting European and American politicians, business leaders, and scholars for a decade—Merz’s shift in perspective indicates the profound impact of current global uncertainties. Trump’s challenges to NATO’s security obligations and his willingness to negotiate peace with Russia, potentially sidelining Ukraine and other European interests, have compelled Merz to rethink traditional alliances.
Europe’s Defense Landscape: A Critical Turning Point
The 69-year-old corporate lawyer may well be the catalyst needed for a revitalized European defense strategy. Policymakers argue that this revival must encompass significant increases in defense spending, improved coordination among defense industries, credible security assurances for Ukraine, and a renewed defense collaboration with Britain. Many in Brussels and Berlin view this as the most significant challenge the European Union has faced since its inception in the 1950s, potentially overshadowing initiatives like the establishment of the Single Market and the euro.
For decades, European leaders have sidestepped defense issues, largely due to the politically sensitive nature of such discussions, fearing that collective action might undermine national sovereignty or embroil the continent in unwanted conflicts. A central concern is funding; European nations, including the UK, have long acknowledged the necessity of increasing their defense budgets. The NATO summit in Cardiff in 2014 committed member states to allocate 2% of their GDP to defense, a target that many have struggled to meet.
- Despite gradual increases, current spending levels still hover around the 2% threshold.
- Experts now suggest that a 3% allocation is essential to address contemporary threats.
The European Commission is contemplating a substantial defense budget, which could reach up to €500 billion (£415 billion). However, implementing such a plan would require a special funding mechanism, similar to the EU’s successful €800 billion (£663 billion) Covid recovery fund, or the introduction of defense Eurobonds.
Merz appears ready to tackle these challenges head-on. Unlike the cautious outgoing Chancellor Olaf Scholz from the Social Democratic Party (SPD), Merz has indicated his willingness to break from the EU’s traditional debt financing constraints to facilitate this plan. This approach has garnered positive attention from France, which grew frustrated with Scholz’s hesitance to engage in European defense discussions. Camille Grand of the European Council on Foreign Relations notes, “The Franco-German engine was largely dysfunctional under Scholz, marking a low point in bilateral relations. Many in Paris have high hopes for Merz, especially given his recent statements advocating for a more capable Europe.”
Additionally, the EU is in the process of negotiating a security agreement with Britain as part of a Brexit reset. Merz has signaled a more flexible approach regarding how the EU could collaborate with the UK on defense matters outside of NATO, particularly in initiatives aimed at supporting Ukraine. Ian Bond, deputy director of the Centre for European Reform, remarks, “The British defense industrial sector remains robust. It is logical to include Britain in EU efforts to adapt to a world where American support cannot be taken for granted.”
Germany’s Budgetary Challenges and Future Prospects
However, the primary challenge remains reforming Germany’s own budget framework. Merz has proposed a substantial €200 billion (£166 billion) boost in defense spending to bridge the funding gap. Germany’s constitutional “debt brake” currently restricts the government from running a structural deficit exceeding 0.35% of GDP, a limit that is inadequate for the necessary increase in defense expenditures.
Merz has publicly expressed his desire to abolish the debt brake, and he has garnered support from the SPD and the Greens, his likely coalition partners. Nonetheless, their backing does not amount to the two-thirds parliamentary majority required to amend the constitution in the new Bundestag. Merz has suggested that this measure could be pushed through the outgoing legislature, which is set to dissolve on March 25.
Germany’s allies within the EU, NATO, Britain, and Ukraine will breathe a sigh of relief if Merz can successfully escalate defense spending. Yet, he himself has acknowledged that this radical shift is a direct response to the changing dynamics emanating from Washington. As he stated on Sunday, “I never imagined I would have to say something like this on television, but after Donald Trump’s comments last week, it is evident that this administration does not prioritize Europe’s future.”
