German Chancellor Friedrich Merz, MGGA
German GDP growth has underperformed that of the eurozone since 2019
Germany’s famously open economy was its greatest economic asset, delivering almost 20 years of uninterrupted growth and turning it into one of the biggest winners of globalization. Now that openness has become its biggest liability.
China, once a glutton for goods made in Germany, has turned into a mercantilist superpower. It produces many of the same things at a fraction of the price and often with equivalent—if not better—quality.
Most economists and the government expect gross domestic product to grow by 1% or less this year. GDP growth has underperformed that of the eurozone since 2019.
In 2003, the government of then-Chancellor Gerhard Schröder took an ax to unemployment benefits, gave employers more say in setting wages and lowered taxes.
The legacy of Hartz IV is a lumpen-proletariat of 7.4m people
The Germans gave up the D-Mark reluctantly under French and Italian pressure, as the price for acquiescence in Reunification.
Within two years, unemployment was falling, exports soaring and public coffers filling up.
For six years in a row, Germany was the world’s largest exporter of goods, not just per capita but in absolute terms.
Economists say Germany has lost competitiveness since.
Bertrand Benoit Wall Street Journal 26 June 2026
Long reluctant to wield hard power and content to outsource its defense to the US, Germany’s “holiday from history” — as some political scientists have characterized the country’s hands-off approach and post-Cold War peace dividend — is over.
Under Merz, Germany has promised to build Europe’s strongest conventional army, move toward meeting Trump’s demand that NATO members spend 5% of GDP on defense, assist Ukraine in developing long-range missiles to repel Russia’s invasion, and explore nuclear sharing with France and the US.
In March, Merz backed a reform of the so-called debt brake. Voters were understandably aggrieved that Merz, once a fiscal hawk, waited until after the election to reveal his spending plans.
He’s also created a National Security Council in the chancellery to better coordinate foreign and security policy,
Bloomberg 6 June 2025
Annika Ström Melin: Tyskland har tröttnat på sin 70 år gamla roll
Efter landets ansvar (och skuld) för världskrig och folkmord blev europeiskt samarbete ett sätt för Tyskland att behandlas och bli ett land som alla andra.
Men ingen hade glömt det som hänt. För att inte provocera övriga medlemsländer alltför mycket har Tyskland därför ända från början försökt lägga band på sin styrka.
Annika Ström Melin DN 5 september 2024
https://englundmacro.blogspot.com/2024/09/annika-strom-melin-tyskland-har.html
Tyskland?; frågan om vilket land som ska ta på sig ledartröjan
https://englundmacro.blogspot.com/2025/06/tyskland.html
In Strasbourg on Dec. 9, 1989, after the Berlin Wall fell, Germany agreed to monetary union in order to get President Mitterand to agree to German reunification
WSJ 23 Sept 2011
https://englundmacro.blogspot.com/2019/09/germany-it-says-will-never-accept.html
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