Germany is entering a period of significant change as Friedrich Merz is set to take the reins as the next Chancellor, following his party's election victory earlier this month. The shift promises to reshape the nation's role on the European stage amid growing tensions with pro-Russian factions and pressure to support Ukraine during its conflict with Russia.
On February 28, 2025, barely five days post-election, Jörn Fleck, senior director at the Europe Center of the Atlantic Council, shared insights about the incoming government’s potential impact. He noted the promise of bolstering Ukraine’s defense efforts, reflecting Merz's intention to adopt a proactive stance on European autonomy. “This government offers the opportunity to strengthen both Ukraine and the wider European alliance,” Fleck remarked.
Entering this new political chapter, Merz has promised to adopt strict fiscal measures. He announced his intention to cut costs even as he introduced a €500 billion financial package intended to boost economic restructuring. This plan, which relies on relaxed constitutional limits on debt, is supported not only by his own Christian Democratic Union/Christian Social Union (CDU/CSU) coalition but also the center-left Social Democratic Party (SPD). Merz elaborated on the need for fiscal discipline, stating, "We will have to cut costs on the federal level, on state level, and local communities," during his appearance on German public broadcaster ARD.
Key to enacting this ambitious package is the necessity of securing approval from both the Bundestag and the Bundesrat, with Merz’s team needing two-thirds majorities from both legislative bodies. This financial plan has been characterized as landmark legislation aimed at significant investments, including €100 billion allocated to combat climate change. Notably, Germany’s environmentalist Greens have indicated potential support, pivoting from initial objections.
The Budget Committee of the Bundestag has already recommended approval of the CDU/CSU and SPD’s finance package, with the Green Party’s budget chief, Sven-Christian Kindler, declaring last Sunday, "Today in the Budget Committee, we cleared the way for future investments." But the release of funds still hinges on upcoming votes slated for March 18 and March 21, which require the imperative two-thirds majorities.
Yet, opposition remains steadfast. Several Bundestag members have vowed to challenge the package, with independent member Joana Cotar spearheading efforts to petition the Federal Constitutional Court to delay the upcoming vote. Cotar filed suit claiming insufficient time to properly assess the package’s socio-economic repercussions. Fellow opposition member Florian Toncar from the Free Democratic Party (FDP) echoed similar sentiments, criticizing the rushed timeline for discussing such monumental fiscal changes.
Merz himself has acknowledged the impending coalition negotiations with the SPD will not be without challenges. He predicted “very difficult conversations” over necessary reforms and potential budgetary savings. He aspires for his government to be operational by Easter, envisioned as mid-April, roughly 50 days post-election.
Public sentiment reflects anxiety about job security as labor unions staged significant demonstrations, with over 80,000 participants advocating for secure industrial employment across several cities on March 15. The IG Metall union chair, Christiane Benner, asserted during the protests, “With our day of action, we are sending a clear signal for swift action, bold investments by politicians and companies, and above all, for our future.” The labor climate remains tense as unions push back against employer attempts to relocate and downsize.
A concurrent issue facing the new government is the expansion of the mother’s pension scheme, which has faced strong criticism from the German Federal Pension Insurance Association. The plan, which seeks to allocate significant funds yet lacks clarity on sourcing these finances, was panned by the organization’s president, Gundula Roßbach, who insisted, “We’re talking about huge sums of money.”
Regardless of domestic challenges, international issues remain on the front burner. Peruvian farmer Saul Luciano Lliuya's unprecedented legal battle against German energy giant RWE is gaining attention as he demands the corporation contribute to flood defenses for his hometown, impacted by climate change resulting from RWE’s emissions. This “David versus Goliath” scenario could potentially set legal precedents for climate responsibility.
With the political climate shifting and the coalition government’s approach to governance under scrutiny, recent data reveals perspectives on prior pandemic restrictions. A recent poll indicates over 56% of Germans affirm the previous lockdown measures were justified, indicating continued trust in government intervention during health crises.
Supplementing these notable currents, less than 275,000 people are currently registered as organ donors, prompting calls for greater outreach efforts to inform the public about the opt-in system.
Merz's leadership appears poised for significant investments, yet the path forward emanates considerable uncertainty, with the citizens and coalition partners watching closely as the fresh government takes shape.