Written by Ahmed Adel, Cairo-based geopolitics and political economy researcher
The German government needs to invest mainly in infrastructure, education, and housing instead of the military because the danger allegedly coming from Russia is unrealistic, said the country’s former chancellor, Gerhard Schröder, in an interview with the Suddeutsche Zeitung newspaper. His statement comes as the popularity of German Chancellor Olaf Scholz continues to decline, along with the economy.
“Do you really believe that Russian medium-range missiles will be fired at Germany?” he said, commenting on the government’s increased spending on the German Army’s combat capabilities.
Schröder criticised Scholz for creating a special fund for the German Army despite other problems existing in Germany that require considerable investment.
“Scholz said: €100 billion – and nobody knows what for,” he highlighted.
Instead of investing mainly in rearmament, the former chancellor called for infrastructure, education, and housing investments because, according to Schröder, German citizens are miserable.
The Bundestag and the Bundesrat (both chambers of the German parliament), in turn, in June last year and by a majority vote, supported Scholz’s initiative to create a special fund for the Bundeswehr worth €100 billion. The current chancellor believes that the German military will have the largest regular army in Europe after modernisation.
Scholz formed a coalition of his SDP party, the Greens, and the Free Democratic Party (FDP) to gain power. However, at the halfway point of his term, the popularity of his party and coalition is looking grim, and news of wasting €100 billion on the military is not improving the situation.
A poll by DEUTSCHLANDTREND at the end of August found that if a federal election were to be held, the SPD would gather just 16% of the vote — nearly 10% lower than when it secured power — and, more importantly, behind the Alternative for Deutschland (AfD) party, which seeks reconciliation with Russia and end of support for Ukraine.
Meanwhile, a poll by German broadcaster ZDF, also conducted in the second half of August, found that 51% of Germans are dissatisfied with Scholz’s leadership for the first time since he took office in 2021. Only 43% of respondents said they were satisfied with Scholz’s work.
If these same polls were conducted now, Scholtz’s popularity would likely be even lower, considering the government announced on October 11 that the German economy is expected to shrink by 0.4% this year.
“We’ve had a difficult year economically, at a difficult time,” said Economy Minister Robert Habeck. “[The cause is] the energy price crisis, the need for the European Central Bank to fight inflation and the weakening of important global economic partners [, such as China].”
Berlin’s new forecast contrasts with the 0.4% growth initially predicted in late April.
“We are emerging from the crisis more slowly than expected,” Habeck added, but “we have reached the low point and will be moving forward again.”
Only a day before Berlin’s economic revision, the International Monetary Fund forecasted that the German economy would shrink by 0.5%, while a group of leading German economic think tanks in September predicted a 0.6% contraction.
The Economy Ministry expects the economy to pick up in the winter and then accelerate because of recovering consumer demand. The Ministry also explained that the “necessary fighting of inflation” by the European Central Bank has been a factor in Germany’s economic difficulties, which resulted in higher borrowing costs.
Germany’s main issues include an ageing population, lagging use of digital technology in business and government, excessive red tape, a shortage of skilled labour, and, most importantly, crushing energy costs due to the self-depravation sanctions regime imposed on Russia. It is for this reason that Germany is slowly and quietly returning to Russian energy sources after it was revealed recently that Securing Energy for Europe GmbH — a former unit of Russian gas giant Gazprom PJSC — plans to load LNG produced by the Yamal plant in Siberia early next month.
Although the EU has imposed sanctions on Russia following the announcement of a special military operation against Ukraine, the bloc still allows the import of Russian LNG. This has not stopped European politicians from criticising Russian LNG shipments’ approval, which increased after Gazprom suspended Nord Stream pipeline deliveries, but it does show how Germany struggles to balance its economic interests with its false moralising of Russia.
For this reason, Schröder is absolutely correct in his assessment that decision-makers in Berlin should start prioritising domestic matters rather than trying to build Europe’s largest military force at the massive price of €100 billion despite no credible threat existing against the country and other issues needing priority.
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