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Hello, everyone, and welcome back to These Times. I'm Tom McTague. And I'm Helen Thompson. We're recording today's episode on a momentous day in world politics, not only the third anniversary of the war in Ukraine, but the day after Germany went to the polls, removing Olaf Scholz's...
Chancellor in elections won by the Conservative Christian Democrats, but with their second lowest vote tally ever. As the results were coming in, Friedrich Merz, the Conservative leader almost certain to be the next Chancellor, said his priority would be gaining independence for Europe. from the united states the question we're asking in this week's episode is what do the results of the german elections mean for the future of european politics
Germany now and the Conservatives are celebrating winning the country's election. The results also saw large gains for the far-right party, Alternative for Germany or AFD. The man now set to lead Germany. The centre-right politician told his supporters that he understood the enormity of the task now before him. Meanwhile, flags were waving at the AFD election base. Cut it!
The far-right party came second, its best ever result. They won't get into government, as other parties won't work with them. But they say they're on the road to power. On American relations, Friedrich Mertz gave this stark assessment. After Trump's statements last week, it is absolutely clear that this US government doesn't care about Europe.
So Helen, we've got a huge amount to digest in this episode. So I think the first thing to do is to say how we're going to divide this episode up. In the first half, we're going to focus on German domestic politics, what happened on Sunday in the elections, what the results mean. terms of future coalitions what happened to the alternative the deutschland party and finally how it all ties into this key thing to understand about
German politics, which is the debt break. In the second half, we're then going to expand the discussion to focus on geopolitics of the results, what it means for German security policy, and in particular, European defence policy. So I guess let's have a look at the results, Helen. I mean, we don't have all the clarity yet as we're recording this on Monday morning in terms of the number of seats that each party will get.
But we have the vote tallies. So we have the CDU, the CSU, which is the conservative coalition of Christian Democrats and the Bavarian sister party at 28.6% of the vote. alternative, the Deutschland party, second place with its best ever result at 20.8%. The SPD, that's the party of Olaf Scholz, the Social Democrats, down at 16.4%. So a terrible day for them. The Greens, who were in coalition with the SPD, at 11.6%. And then the De Linke party, the left-wing bloc, at 8.8%.
Mertz has said that he wants to try and pull together a coalition of parties to form the next government by Easter. It's a tough target Helen. because of the depth of the negotiations that are going to have to take place now. But actually, the outlook, the sort of the result of this election looks fairly clear now that it looks like it's going to have to be a grand coalition between the CDU and the...
That seems to be the only result that's possible now. I think the crucial thing in this respect, Tom, is what happened overnight, which is that it's now clear that the Sarovargen-Nekt alliance... has not got 5% of the vote. I mean, and it's an astonishingly narrow miss for the Sarah Varga Nectar Alliance. I think that as we're speaking, the total on the BBC site is 4.97 and it needed to be 5%. And the significance of this is that...
It is possible for Mertz to form a grand coalition only with the Social Democrats. And that would have been extraordinarily difficult, probably actually impossible. of the Saravagan Nect Alliance had been in the Bundestag and Mertz had made clear pretty much through the campaign but certainly in his comments
including his comments on Sunday night, that he wanted a two-party coalition and not a three-party coalition, if at all possible. And we can come back to some of the reasons for that. But that means that the... Coalition is almost certainly going to be between the Christian Democrats, the Christian Social Union and the Social Democrats. So that Germany is going to have yet again a grand coalition.
government and that means that if you go back to the elections from like 2005 onwards to this point in 2025 so over over 20 year period there's actually only going to be two governments that won't have been Grand Coalition. So that's the one that's the outgoing one, headed by Schultz, which was Germany's first three-party coalition, Christian Democrats, Greens, Free Democrats, and then the second Merkel government, which was Christian Democrats and Free.
Democrats. If you look at what's been happening to German politics in terms of the election results during that 20-year period, what you can see is that the two grand coalition So the two principal parties of the centre right and the centre left have been getting ever smaller.
percentages of the overall vote so if you go back to the first grand coalition it's not the first grand coalition of the west german republic but it was of the reunified german politics between them they won 69 percent of the the vote you go back to 2017 which
was the last time there was a coalition government after the election, then they won 53.4%. And now it's going to be around 45% of the vote. So you're having the governing coalition problem keep leading to... or having a high probability of leading to the same outcome at the very same time in which the two principal parties are becoming weaker and this electoral fragmentation is taking place.
A few thoughts from that, Helen. I mean, the first thing on the Sarah-Wagen connect, it does strike me as remarkably close, and we should just dwell on that for a minute, because they are seen as a party of the, strangely, of the left-right, you know, that they are economically... of the sort of hard left but they favor much closer ties with Russia in terms of geopolitics. Now the fact that they've been kept out the principal result of that is that
the two main parties do not have to form a coalition with the Greens. And I think we can say from the last coalition that There is something just structurally difficult for German politics about maintaining a coalition of three parties. I mean, in that last coalition of the SPD and the Greens...
and the Free Democrats. That just seems very difficult to hold that together. I mean, if you just sort of look at it analytically and you say you've got a party of a conservative right in economic terms, and then the Social Democrats and then the Greens, and they had to try and... come together to form a coalition. Now, so in some senses, for those people who are looking to Germany for some sense of stability and...
kind of in a sense, an understandable politics that we are, you know, that the EU is comfortable with. This result... will be seen as something of a positive result for people, for most of the main parties in the EU, because it looks less structurally difficult to maintain over a longer period. Yeah, I think it's very striking.
Tom, how determined Mertz has been through this, if at all possible, to avoid a three-party coalition. And I think if we go back to the 2017 election, actually... that in the end led to the last grand coalition government. We can see something, I think, of why that was the case, because the first response of the parties to the 2017 result was an attempt to form a three-party coalition. But that time, the Christian Democrats, the Free Democrats.
and the Greens, so not the one that came after the 2021 election. And then the Free Democrats pulled away from those negotiations. And it was that then led to the formation of the Grand Coalition, which is not something I think that either party wanted to do. There was considerable resistance within the SPD about going into coalition again.
with Merkel because it looked like from their point of view that the consequences of it were that they kept being weakened and the Christian Democrats in a comparative sense with them were strengthened and I think in one sense you can say that the 2021 election was a bit of an outlier from the point of view of the comparative success of the Christian Democrats and the Social Democrats.
Because Schultz, as the SPD leader, was able very effectively to present himself as Merkel's natural successor, as like Merkel too. And that kind of took away from the structural weakness over the... of the social democrats pretty much throughout the entire grand coalition period so this result for the social democrats is going back to normal or what's become normal
And then I think if you look at what happened in terms of why this election has taken place, because we should remember it's a premature election. the election came about because Schultz dissolved that three-party coalition the morning after Trump's election victory, that really that the three-party coalition agreement had come apart from late 2023 from the point...
in which the German Constitutional Court had ruled unconstitutional the 60 billion fund that had been the basis of the coalition agreement between the three parties. Now we'll come to then how that unraveled over the course of the last year.
it also but i think it's important to see as to why merch would be so averse to having a three-party coalition that problem has left germany rudderless in terms of its government for more than a year and if you then know look at what happened during the election campaign, that there's a tension, which I think gets to the heart of why it can still take quite a long time to form a new government, even though...
The nature of the governing coalition is pretty much clear because there are quite deep differences of opinion between the Christian Democrats and the Social Democrats that are going to have to be given the way that German politics works. worked out in a coalition agreement that really could take a long time to negotiate. Now, one of them, the debt break is central, and we're going to come to that at the end of this half.
I think that it's very notable that in the period between September, so the six weeks or so before Schultz dissolved the coalition, and now the Social Democrats and the Christian Democrats have been engaged in quite intense criticism. of each other, particularly in regard to migration issues and the issue of the firewall, the Cordon Sonneter, with the alternative for Deutschland. So these are two parties that have been heavily critical of each other, particularly the two leaders.
in one sense been competing with each other more directly than anything else during the course of the election campaign who've now got to come together.
and form an agreement about how they're going to govern for years. In one sense, it seems that almost the clarity of the victory for the CDU perhaps puts Mertz in a strong enough position where he can... really dominate those discussions with the social democrats or that that is a kind of optimistic take about how it may be possible to bridge those gaps but as you say the gaps are quite startling when you look back over the last few
months. You know, you have questions that are not just sort of technocratic questions, but... really fundamental questions about Germany's national policies, whether it's towards the war in Ukraine, where you had in the run-up to the election, Schultz accusing Mertz of really being like a warmonger was the kind of language that he was using. That's a fairly fundamental
you know, gap between the two parties that is going to have to be overcome on a core question of national policy. Then you had two other questions, didn't you? Migration and obviously linked to that Schengen, where you had Mertz, who's... really ratcheting up his language on migration in the run-up to the election, both in terms of deportations of illegal migrants, but also about checks on the borders, Germany's borders.
which Donald Tusk, the Polish prime minister, said was effectively the end of Schengen agreement and unacceptable. And Mertz's calls during the run-up to the election were rejected by Schultz as going... too far in terms of effectively pulling apart Schengen, the free movement of people within the European Union.
So those two questions strike me as particularly difficult to overcome. And they also tie in to that third question, which is the firewall with the AFD. Because Mertz's analysis seems... quite clear that the reason for the afd's rise in his view seems to be angela merkel's policies about open
borders and we can do this in response to the Syrian refugee crisis. He is sort of directly laying the blame for the rise of the AFD at his predecessor, somebody he has had this kind of long-running political battle with. as the heir apparent to coal in the 1990s and 2000s. So this is a long-running personal battle between Mertz and Merkel that is playing out before us now in terms of policy on migration.
But on the question of the firewall, though, Mertz is clear that the firewall will remain in place. That said, in the run up to the election. it was kind of being nibbled at the edges in terms of he was putting forward proposals that were seen as unacceptable. to the Social Democrats that could only secure support in the Bundestag with the support of the AFD. So there's lots going on here. There absolutely is. And I think that is a crucial episode, what happened at the end of January.
Because it's one thing for Mertz to say the firewall holds when it comes to the actual participation of the AFD in government, because that is holding. I mean, it is clear that although... You might say, looked at from one perspective, that the obvious coalition that comes out of this German election is the Christian Democrats and the AFD. That is not going to happen. That would be, arithmetically...
an easier coalition than what's going to ensue between the Christian Democrats and the Social Democrats, which is going to be a narrow majority. But what Mertz has been willing to do... in the run-up to the election is to entertain the possibility that a law could only pass with AFD votes. And what happened on the 29th of January was that a motion passed through the...
the Bundestag with AFD votes, so votes coming from the AFD and the Christian Democrats. Then Angela Merkel very heavily criticised Mertz the next day for that. saying that it was not acceptable. Murch responded by blaming her, essentially, for the rise of the AFD. And then on the 31st of January, he tried to pass a law. that would have to have required AFD votes, given that the coalition parties were opposed to it.
And that law would have tightened the rules on migration and increased the number of deportations. And it brought significant protests like across... And he wasn't able to hold his whole party together on the actual law vote as opposed on to the motion vote. And in a way...
That's the context in which you could then put like the Vance speech in terms of like attacking the firewall and sort of pushing at something that in a way was already bubbling up in German politics. But when it comes to... actual coalition formation the firewall is holding now the consequence of that though is that if you look at the map of germany as to where the afd have done and indeed where
have done well that means that the old east germany is effectively not being going to be represented or very little representation in the government is going to ensue because The grand coalition parties are the successful in the old West Germany and AFD.
De Linca, I think I'm right in saying that De Linca actually won in Berlin. Well, there was the largest party anyway in Berlin as their success is in the eastern side. So in that sense, that the... coalition formation aspects of the election are going to double down on the division of Germany.
And Mertz himself is an important figure in this. My understanding of him is that he is seen as a very traditional West German conservative politician. And until now, actually, he has been seen as a fiercely... atlanticist west german politician and one of the sort of the key dividing lines or tensions in german politics we should say is that the
AFD, with its support base in eastern Germany, is noticeably more open to a pro-Russian policy than the CDU. But right now, then you have this laid into it, and we're going to discuss this more in the second half. you then have this question of, you know, what do you do about Donald Trump's policies? And so you suddenly have this West German conservative politician with no support, you know, really in East Germany, trying to navigate Germany.
future towards something completely different to what he spent his entire life advocating for. It's a kind of extraordinary moment in German politics. And the other thing, Helen, that strikes me about this moment is that while you have that sort of play... in the background of German politics, or we should probably say in the foreground now, you also have this question of German debt and policies towards debt and deficits. And again, if you think about the...
Conservative Party, the CDU, of which Mertz is now leader and soon to be chancellor, you know, they represent German fiscal orthodoxy. That's who they are. And yet... The central challenge now for Germany is going to be what do you do about this debt break, which is the reason, as you've sort of set out.
for why we're in this position in the first place. Yeah, I think that what's really notable about the election results in this respect is that between them, that the AFD and De Linca have won enough seats to block. a reform of the debt break. So that is the bit of the German constitution that was inserted in 2009. puts strict limits on German borrowing. It effectively allows for a structural deficit in German annual borrowing at 0.35% of GDP.
Now, I think it's fair to say that the CDU, for the reason that you've just said, and the SPD, we're going to have a very hard time anyway, agreeing on reform to the debt break. But it means that... The two-thirds vote that they would need in order to change the constitution, assuming that they could reach an agreement, now can't be done without some peeling away from one of these parties, either AFD or D-Linker.
And I think it is important here to go back to that moment that I was suggesting was significant earlier with the German constitutional court's decision in late 2023, because what that meant was that the fix... if you like, that German politicians had come up with to deal with the consequences of the debt break in the post-pandemic world or in the pandemic world and then what's come after the pandemic world in terms of Russia's invasion of Ukraine.
fell apart so what they did to deal with the pandemic was to create an off-budget fund and then the money that wasn't spent from that was repurposed as part of the coalition agreement that Schultz negotiated with his party, the Greens and the Free Democrats after the 2021 election into a climate fund that allowed the different objectives of the three parties in the coalition. to be met without really having to make hard choices. And once that unraveled on the court's decision...
it became incredibly difficult for the coalition to function. And that was happening when the issue of more military aid for Ukraine was coming to the fore, particularly by the summer of this year, when it was clear that the... Ukraine various counter-offensives hadn't yielded results. So if you go back to August of 2024, you start to have these reports saying that there were serious differences between Schultz and Lindner, the Free Democrat.
and that Lindner is wanting to protect military aid for Ukraine. Schultz is saying it can't possibly be done at the expense of German pensions. And it is that issue of what to do about the budget that... leads Schultz to dissolve the coalition the morning, I said, after Trump's election. But what is then noticeable is that as this issue is like ticking away, there is no effort by the parties who are... in principle, in favour of some kind of reform to the debt break, to move before the election.
And part of the reason for that is because the Christian Democrats and the Social Democrats cannot agree on what that debt reform should be. So the official position of the Christian Democrats has been through this election campaign that the debt break should stay. And then Mertz himself has made some remarks which would suggest he is amenable to reforming it for the point of view of defence, perhaps some.
infrastructure but he's not going to agree to a more expansive reform of the debt break whereas from the point of view of the social democrats and More defence spending isn't necessarily their first thing that they've got in mind when it comes to reform of the debt break. And so I think that that... is going to be at the heart of why it's going to be really in substantive policy terms really still difficult for the
Grand Coalition parties to come to an agreement, even though there isn't really any alternative given the firewall to a Grand Coalition government ensuing. Yeah, I think Schultz has said something in the run-up to the election about the way... that the debt break can be gotten around if there is an emergency like there was in terms of the pandemic. And I said that...
If a war in Europe is not an emergency, you know, then what is? So perhaps there is some kind of political will, just the sort of the brute reality of the decisions that will be coming towards this coalition will sort of force them to find a way.
around the debt break in terms of whether they can say there's an emergency. But then I guess all of these questions will be tested both politically and constitutionally about like they were before about the energy crisis. The thing that strikes me, Helen, the most... about this when I try to think about it in the longer term, is that it almost seems that German politics is, there is like this structural vulnerability that is playing out.
Slowly before our eyes, if you go back to the sort of almost at the short sightedness of Merkel's decision to move and impose this debt break in response to the 2008, 2007, 2008 financial crisis is really. The scale of the short-sightedness is revealing itself now, creating these fundamental problems that seem very difficult to resolve. If you think the situation today in Germany is that they have the question of Ukraine.
Rearmament. You had Schultz talking about a Seitenwender, a turning point in German politics in his term, which just... clearly doesn't seem to have been the case. There hasn't been a turning point. In fact, you've had the lack of turning point has created the pressure that's created the situation that we find ourselves in today. The FT...
B, the Free Democrats brought down the coalition effectively because they weren't prepared to move any further on debt. And then you have these sort of twin or maybe three structural challenges that play. all into this lack of flexibility. You have the energy transition because that was the fund that ended up in the constitutional court was there to manage the energy transition. You have the question about
how much Germany spends on its defence, which is now playing into politics with what Mertz is saying about the need to gain independence from the United States, which we're going to turn to in the second half. So two fundamental structural questions. And then on top of all of that, you have this core question of German economic decline, which is making this challenge ever harder for the German governments to manage.
Very difficult to understand how that can be turned around with the current constraints on the German government, because you have this, I mean, it's hard not to think of it as a sort of existential threat to the German economy. from the manufacturing prowess of China. So for me, I mean, the fundamental question here is how can Germany turn around its economy, which we should say has had two years.
of recession, not consecutive quarters of recession, but two years of which the economy has contracted, five years of stagnation. How can it turn that situation around given the threats? from China, while it maintains its economic orthodoxy, essentially. while at the same time being under pressure to somehow come up with an energy policy, the energy transition, and fund a... total change in its defense policy. None of that seems to add up to me in any coherent way.
I mean, we've got to turn quite a bit of that after the break, Tom, but I think there's a couple of things that we should pull out just to finish this half on the debt break question. And that is, first of all, that the German debt break has, in a way... been a geopolitical problem for germany right since the at least 2011 so if you go back to the height of the eurozone crisis so if you go back to what merkel's policy is At that point, she is trying to Europeanise the German debt break.
via the fiscal compact. She pretty much wants every Eurozone state, at least, if not every European Union state, to do the same. That's the position that she's adopted. And it was driving the Obama... administration are apoplectic in terms of the constraints it put on the way in which Germany could deal with the Eurozone crisis. And he, Obama and his... Treasury Secretary Geithner were putting a lot of pressure on Merkel over the issue and she wasn't able to Europeanise the German debt.
position and in the end had to accept that the solution to the eurozone crisis was Mario Draghi's solution, which was to allow the European Central Bank to act as a lender of last resort and eventually adopt quantitative easing. And that way, that was a complete repudiation of Merkel's. essentially fiscally driven approach to the eurozone crisis if we then move on to zeitenwender speech that you mentioned
which came in the days after Russia's invasion of Ukraine, so pretty much exactly three years ago. And you look at what Schultz said in that. He reached for the off-balance sheet, off-budget solution. which was to say there was going to be a 100 billion euro pot for defence expenditure. So in a way that ever since three years ago, or really in the first place with the coalition agreement, but then dramatically in terms of defence, that...
trying to do things outside the budget framework has been the German political response to this problem. But the problem was on the climate one, constitutionally challenged. And then as we'll see... in terms of defence in the second half, is that it's not clear what was achieved in any way by the supposedly 100 billion euros that were spent. So what is playing out now is it's like an ongoing structural problem, not just for German politics, domestic politics, but for Germans geopolitical.
position that is nearly a decade and a half old now. Now let's take that moment to end the first half and we'll pick up the story and sort of try to dig into what it does mean for Germany's defence policies, security policies and for Europe overall in the second half. Saturday night. Tuesday morning. That's summer. No matter what happened, you deserve support. If you've ever experienced sexual violence or abuse, free specialist and confidential support.
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Top up anytime, anywhere. In-store, on mobile or online. Search Get a Smart Meter. Eligibility may vary. Consumer action required. Welcome back, everybody. So in this half, we're turning to what the German election means for its defence policy and for European geopolitics more generally, because it really is quite extraordinary, Helen, how quickly things
seemed to be moving. Obviously, the election itself was framed, in a sense, or at least had this question of Donald Trump hanging over it from the very beginning, you know, with Schultz. calling it the day after Donald Trump was elected as president in November. And all the way up to the election itself, the presence of the United States and the position and the radicalism of this Trump administration was directly playing into the German election, whether you most noticeably, obviously, with J.
J.D. Vance's speech in Munich ahead of the vote, in which he essentially called for the firewall between the main parties and the AFD to be got rid of. That was the essential message of J.D. Vance's speech.
...caused uproar among many in German politics and German media. Although how much it had an effect on the election I think is open to question. The results seem to really match the poll numbers in the run-up to it. But you had Mertz... responding to this, directly two days before the election, he said that Germany would have to speak to both Britain and France about nuclear, about in effect sharing Britain or French nuclear weapons.
in itself, an extraordinary thing for Mertz to say, not only because, as we've said, Previously, he has been a staunch Atlanticist throughout his career. And now he is saying, calling into question the future of the transatlantic alliance and seeing if there is a European solution to Europe's defence. And then in the... hours after the results became clear.
Mertz was even more explicit on German TV, saying that the key aim for the EU in the coming years was, in quotes, to achieve independence from the US. And he said that Donald Trump, you know, the reason why Europe had to achieve independence... So, I mean, I think we should at least spend a few moments reflecting on this because it...
has been rightly picked up by commentators across the board as a moment which at least seems to suggest that we are moving in a completely different direction. I think that it's fair to say that if you go back to November... So in the days after Trump's election, that there was a considerable amount of worry in Europe and in Germany in particular, perhaps.
about the Trump presidency. If you go back to what Merkel was saying then, and I think she is revealing in this respect, and I think we mentioned this when we did our episode on Elon Musk, that's what she actually focused on. was the Musk factor more in some ways than the Trump factor. Her concern was about the satellites, the SpaceX.
So Musk's company own and European dependency upon SpaceX. That seemed like central to her concerns. If you look at then what coming out from the European Commission. led obviously by a German, that the focus was the likelihood of tariffs from the United States directed at the EU. Von der Leyen, as the president of the commission, was...
Essentially saying, look, we will promise we'll buy some more liquefied natural gas if that will appease you about tariffs. The defence question isn't really to the fore. And I think what's fair to say is that nobody... in a European capital, had really got in their head in November that by the time the German election would take place, that...
Donald Trump would have done something that so dramatically threw into question the nature of the American security guarantee to European countries. And then having that happened a few days later, and that came obviously... in light of Trump's phone call with Putin. And a few days later, then Vance went to a German city, to Munich, and effectively read the riot act.
to Europeans in general, but the Germans in particular, about the way in which they conduct domestic politics and the way in which the European Union in relation to Romania in the Romanian election in particular. So there was a sense in which that this German election, which had already got this kind of context of it's happening in the Trump too era.
what that meant between the first week of November and the last week of February is radically different. And I'm sure if you'd said to Mertz, even in December, early like january that he would have said something like he did on german national television last night effectively we have to start again with security because we can no longer like rely on the americans to do it he would have found that
incomprehensible but tying this to what we were then talking about at the end of the first half tom the thing is that the question about what on earth to do about this has got to be played out in Germany, which is not true in any other European capital in the context of this debt break and in the context in which actually the German government has already had a failed reset.
on defence. That's what Schultz was trying to do in this fighting vendor speech, but it does not move things on. Now, that was entirely in reaction to Russia. It wasn't saying that there's an America problem, it was saying that there was a Russia.
problem but now the russia problem hasn't changed from the german point of view or at least from the german grand coalition party's point of view but a u.s problem has been added to the mix so now the question of like how do you do defense politics how do you do do you crane question when we have this debt break in place is even more difficult than it was back for schultz in three years ago yeah i think there's a question helen that i think is quite
An interesting one in terms of the psychology of this moment in European history. And it is, which is the more important shock of the last few weeks? Is it the meeting? in Saudi Arabia, in Riyadh, between the Americans and the Russians, beginning the peace talks without any European presence there. including obviously Ukrainian presence, and that being a specific policy choice made.
by the Trump administration to exclude Europe entirely from this because they're considered irrelevant in this question because the United States is the leader of the West and it is paying the bulk of this in its eyes. and therefore only the United States should sit at the table. Is that the biggest shock to European politicians? Or was it J.D. Vance's speech in Munich, which was felt, I think, as a humiliation?
as a sort of lecturing humiliation in which he not only says, these are the reasons why we're excluding you. from discussions with Russia over European security questions, revealing Europe's weakness in this regard. but begins to lecture Europe over its own political choices, whether it's the EU's choices in relation to the Romanian elections, or whether it's about the firewall that exists in German politics, which goes really to, I think, to the very core of...
modern Germany's understanding of itself and what it represents and why it has a firewall with the AFD for obvious reasons. And we should say in relation to some of the AFD's parts of the AFD in Eastern Europe, for good reasons, they really are. extreme elements to the AFD. But it's also layered on top of that. Is Vance saying something to Germany, which is, you have been the one country that didn't...
make the mistakes in his view that other countries, including the US, made to de-industrialize. But now you are making that mistake at the very moment when you need to be maintaining German economic strength. This is all playing in, I think, to this sense of shock and humiliation, partly as a result of what Vance is saying, there being this sort of element of truth in it, that the Americans are...
Acting in a way that reveals the extent to which Europe has become weak in relation to the United States. Economically. geopolitically militarily all of these facets are sort of coming together in one moment and i think it's the scale of the shock the kind of the sudden realization that is then feeding directly into the state statements that mertz is making but as you say the key point seems to be that
Despite the scale of the shock and the humiliation that is being felt across Europe, you have the old constraints that remain in place, the fiscal constraints, the political constraints. And it is hard to see. What is going to give? Because we're no longer talking about increasing defence spending up to 2% of GDP. If we're taking Mertz at his word that...
Europe can no longer rely on the United States and it has to achieve independence from the United States, then you are talking about the kind of numbers that Donald Trump is talking about, sort of 5% of GDP, because you're talking about questions as fundamental as... nuclear weapons talking about recreating the entire sort of defense structure for a continent that is not anything that you could even comprehend doing within the current
fiscal constraints that exist in Europe. I think that what's really interesting here is that the nature of the shock when it comes to defence is long in the coming. I don't think that's true of all the other aspects of it. And we talked obviously about some of this in the last episode. You can see the Obama administration.
particularly Robert Gates, the defence secretary, his first defence secretary, been incredibly angry with Europeans about their attitude to defence from 2010 onwards. And the reason why... 2010 which is obviously four years before the annexation of Crimea by Russia was so important was because that was the point when you saw a series of European governments move to cut defence expenditure. in response to the financial crash of 2008. Now, Germany had been...
in one sense, demilitarizing ever since it was reunified and the Cold War had come to an end. But until 2011, then Germany maintained a form of conscription for men anyway. Merkel removed that and did that in 2011. And so you can say very much I think that Germany was quite central to... the critique that Gates was making. I mean, it was also true that British and the French were moving in that direction at that point. And then we get to 2014 and the NATO summit.
where everybody rhetorically at least makes this commitment to 2%. Merkel goes along with increasing defence spending a bit, but not by that much. In 2018, there's a target set. for the German army to reach 203,000 troops. But if you look at what it is now, it's around the 180,000 mark, even in the last government.
particularly from Boris Pistorius, the defence minister, you start getting some talk about having to reintroduce some form of conscription to deal with this. So what you can see is that it's not like the issue of defence is not on the radar. But it is on the radar of the German government in a context in which they're still accepting these self-imposed fiscal constraints. If you then look at the effort that Schultz made...
to operate outside the fiscal constraints by having this effectively emergency 100 billion euro fund. It's quite difficult to see what it's achieved. So if you look at the report from the Bundeswehr that submitted to the German... Parliament, like last year, it actually showed that in 2023 that more than 1,500 soldiers left the German army. So instead of the German army getting closer to this 200,000 plus target, it's actually falling.
Below it, you look at the state of the equipment. The report said that a lot of it wasn't fully operational. Quoting here, there's a lack of ammunition, of spare parts, of radio devices, a lack of tanks, of ships and of aircraft. If you then look at it from the American point of view, you can see that they're very well aware of the limits of Germany as a military actor in a context in which the war in Ukraine has led to more American troops.
being sent to europe and the importance of germany as a place of transit in the war situation to get weapons to ukraine has very much come to the fore there's a there's a fascinating piece by adam twos last week i think in in his chart book where he shows the relationship between the state of german railways
which are pretty decrepit and which have also suffered from a lot of absence of investment in significant part, the debt break coming into play again, and how the state of German railways actually impeded the transfer of weapons. to ukraine and how furious the americans were about it and they had to abandon moving the weapons by the german railway system and had to use chartered water transport in order to get them moved so
This is what I'm trying to get at here, is that this debt break issue, it is geopolitical. Yeah. And it was geopolitical in a way back, as I said in the first half, with the Eurozone crisis. And now it's got a completely different... form to it in relation to defence and want that from the point of view of a German government that has seen, or the German political class I should say, that has seen the Atlantic relationship as central to its existence.
is actually existential. Yeah. Cause there's in a sense, I think there is this, um, easy response to what is going on which is to talk up the need for european strategic autonomy as if it's quite a simple thing to get there to say look It's clear what Donald Trump is, just the presence of Donald Trump in the White House, the second election, that it's an undignified position for Europe to be dependent on the votes of US presidential elections every four years.
is. for its own defense or its own geopolitical positions like that situation cannot last any longer we need to take that take control of that and you can see expressions of that helen with the things that you were talking about like satellites in space and the power of people like elon musk and you can see it in in defense very clearly but the we just need to get the scale of this over i think that to get up to to replenish nato forces
in a way in which the conventional forces, as it stands within the current structure, people that I spoke to over the weekend in positions of real influence said that you're talking about sort of 3% of GDP. from national governments. So the German national government, up to 3% of GDP from around, I think, 2.1% that they're currently spending. The British government, up to 3%. We're way off that still. I think we haven't even put a date on the point at which we're going to get to 3%.
It looks like it could be 2035, I think, under the current speculation when British government could get to 3%. The French government, something similar. The Polish government, interestingly, are already at 4.5%. But that is in with the conventional structures that exist. Essentially, NATO, all of that still relies on American...
Security guarantee. I mean, you mentioned the figure of 180,000 the German army is today. We should just note that the British army is below 80,000 right now. So I think there's a perception in a sense that Germany has...
demilitarized and Britain hasn't quite you know got there yet that's not really the case Britain has an army of less than 80,000 I think it's actually less than 75,000 but it depends on whether you count Gurkhas and the like there are going to be moments which really test European politics.
very quickly, perhaps. So if you read the American papers right now, they're talking about Donald Trump bringing back troops from Europe. There are something like 100,000 troops across Europe, American troops in Europe, 30,000 in Germany, and bringing them... back to man the southern border in the United States. You don't have to be a political expert to see how that could be a wildly popular domestic policy in the United States, but it would be an absolute...
shock right now to European politics. Because even if we go and have a look at what Mertz is talking about, or the response from Keir Starmer to the peace talks between the United States and Russia, They're really talking about incremental steps.
to get to a place where Europe is independent. They're not talking about anything which happens overnight because it cannot happen overnight. They have no way of getting to independence overnight. They're both talking about incremental steps. And Keir Starmer is talking about an American... backstop being required for any security agreement in lasting security agreement for Ukraine. And Mertz is talking about a long term proposal. Now, they may not have a long term.
if we take Trump seriously, what he's saying. And so the scale of what is required to get to any sort of European autonomy is far beyond the kind of discussions that we're making at the moment. And it's not clear, I think we should say, that the decisions for countries like Britain will be obvious in this respect. Mertz is holding up the prospect of an agreement.
with Britain on nuclear weapons. I mean, A, we have to say politically, that would be incredibly difficult for Keir Starmer to sell, you know, sharing nuclear weapons in some respects with Germany or extending the... protection of nuclear weapon the nuclear umbrella to germany i mean how do you even begin that discussion and how do then
Perhaps do you talk open discussions about payments for such a thing? Who knows where such a discussion will go? But just the extent of the investment that'll be required. You could easily see the British. rejecting a European proposal because it's not feasible and it's not politically deliverable for any government and moving actually closer to the American position, despite the humiliations of the, you know, as it is perceived of Trump's attitude towards.
I think that what's really striking for Germany in all that, Tom, is that it is more, or I was going to say it's more existential for Germany, but maybe it's just more, it's just differently existential for Germany. Germany. And this goes back in a way to some of the things that we've been talking about since the turn of the year about, if you like, the...
the sweep of history in the relationship between the United States and Europe and the strange effect of the end of the Cold War on that. Because I think it's fair to say that Germany was the... quintessential if you like end of history state because that was the mindset that really penetrated its political class and the reason for that I think was because Germany was able to achieve
reunification peacefully which was probably not something that had seemed likely perhaps even just the sheer reunification aspect of that at any previous point in the cold war and that In doing that, in achieving reunification in the way in which it did, that Germany put all border questions to rest. It said that it accepted, what it said.
In the end, though he flirted with obviously not doing this, accepted Germany's borders as they came at the end of the Second World War. And that meant it wasn't going to contest the Polish... German border. Then you put into that the fact that there was only partial withdrawal by the United States from Europe in terms of troop deployment after the end of the Cold War and that Germany
remained the place, the country where there was most American troops. So in that sense, is that Germany now reunified Germany, although itself was... partially demilitarising retained a security guarantee and the actual presence of America was a military power in a way in which other European states didn't. And I think that's turned out to be a quite like strange conjunction. It's the context, I think.
in which it became possible for the German political class to think, we can rely on the Americans for security. We can reach an accommodation with Russia. That deepens our energy relationship because obviously the energy relationship was formed in the Cold War years and it was continuing and it extends to the point of actually having German corporate presence in Russia, at least until the invasion in 2022.
And then we can use China's economic growth as a commercial opportunity for big German business. And in a way... that would act as a bulwark against the deindustrialisation forces that are acting upon other European countries. And then what has happened in a really rather short period of time is that all aspects of that have crashed. And that's why I think that Germany is now like the front line. And I think that we shouldn't really be...
surprised about that, particularly in relation to the American security guarantee aspect of it, if we think historically. Because the NATO question, when it applies to Germany, has always been the most difficult. I mean, we've talked about this before. When NATO was formed in 1949, there wasn't even West Germany. West Germany didn't actually get formed until a couple of months as a state and after that. And that issue of like, what do you do then?
If you have NATO effectively giving a security guarantee to West Germany, even though West Germany wasn't in NATO because there was no way that American troops... in Western Germany could be attacked without thinking that the United States would have to defend its own, itself in West Germany.
The remedy to that in time, or 1955, becomes West Germany joining NATO. And if you say, well, what's the geopolitical justification for that? It's like, well, if we've got to defend West Germany, then West Germany is going to have an army. It's going to have to do some of...
this itself it's even at that point it's kind of like an anti-free riding position and yet what ends up in the post-cold war when you've achieved german unification or when the germans have achieved german unification is something about that It kind of continues and it's taken for granted by German politicians who don't, I think, see the contingency of it and the oddity of it once the geopolitical world has changed.
Just thinking historically then, Helen, because as you say, in a sense, the US position since 1945... has constantly been drawn to this question of Germany, as you say. So NATO, also the establishment of the European coal and steel community, as we've discussed, a lot of this is to do with managing... Germany, German weakness, turning Germany from a threat to the West because it's too weak and...
regaining German strength, but then having to manage German strength. How do you do that? You do that through NATO and you do that through European federalism. There have been moments where the focus from the United States on Germany has become a shock. to British politics in fact in both of those moments you could say that they are
shocks to British politics and how do the British governments then react to the American focus on Germany has been a crucial part of British politics. And you can say the same with German unification, where Margaret Thatcher is. essentially feels that she has been abandoned. She has lost Ronald Reagan. She's got George Bush in the presidency, and he has turned from focusing on Britain towards focusing on Germany. And she feels that, and she says this explicitly, I think, in her memoirs, that the
Americans rejected her vision of a future of Europe in favor of the German vision of a future of Europe and how she felt let down by that. And now you have it being experienced as a shock in Germany because the Americans are... I've turned against that very focus on Germany in terms of Germany being the core partner in terms of trying to upend German politics or even just remove themselves from German politics. We don't care about European politics.
has said, you know, being indifferent to the future of Europe, because the most important question is the future of China or the border with Mexico and other considerations. And that being...
a shock that is being now experienced in Germany and then across Europe. But it's like it's almost the inverse of everything we've experienced since 1945. And I think maybe this is a point to just turn to the... importance historically of this moment just one thing there Tom before we move on about the 50s that occurred to me while you were speaking I think it is interesting to get the sequence of events
in the 50s that led to Germany, West Germany entering like NATO clear, because I think there are some parallels. I mean, we should be careful with the parallels because there's obviously something in relation to China that's quite like different. But I think it's revealing about really the nature of American power and the willingness, the longstanding willingness of American politicians to demand concessions.
from Europeans in dealing with these questions. If we go back to the moment when pressure was put on Britain and France to accept... West German rearmament and the possibility of West Germany entering NATO. It was a Korean war. It was North Korea's invasion of South Korea in 1950, i.e. something happened in Asia, in East Asia. that had profound consequences for Europe. That's a kind of like a window, I think, in seeing how insular.
the way in which Europeans can think about these questions are because the United States is always operating, not just in relation to Europe, but in relation to the Asia and the Pacific in particular. The French as we know... we talked about this before, bitterly opposed to the idea of there being a West German army. That's why they pursue, we've talked about it, the European defence community. But then having come up with that idea, they're also very resistant to their own.
And it's really interesting that there's a point when all that's going on in 1954. So that's the year when the French parliament refused to ratify the European defence community that the Senate... armed service committee votes to cut off all aid to france unless that treaty is like ratified like by the end of the year and it's not but the reaction to the french having destroyed their own policy
is actually to have to accept NATO. And then why do they have to accept NATO? Because it dawns on them, I think, that actually what will ensue if that they don't is a bilateral US-West Germany relationship with it.
bilateral security guarantee to West Germany that would cut effectively the French and the British out of proceedings. And if you want to then transpose that like onto now, you can say, well, In a way, perhaps the spectre haunting German politicians is a US bilateral security commitment to Poland.
Now, that's not straightforward because it looks like over the weekend the policy president was a bit humiliated with Trump. But again, go back to what we're talking about last week. It's much, much harder for even...
Trump presidency to detach from the Polish question. It can now detach from the German question because the front line is no longer of this conflict with russia is no longer running through germany i think it's an amazing moment i think the question for the poland will be absolutely fascinating because polish may say something right now but if they are they really going to turn down a direct approach
from the US for some kind of guarantee. I mean, Trump is talking, I think the Trump administration, I forget if it's Rubio or somebody else who was saying that was holding up Poland. It was Hegseth. Hegseth. And he was saying that they were the perfect example of an American.
partner. I hadn't quite appreciated that, but that does, that could be a real threat to European defence policy and a challenge to what Mertz is talking about, actually. I think that, I mean, I personally find that 1954 moment incredibly important because
I see so many of the strands that you see today. You know, you have de Gaulle out of power at that point, raging against the European defence community, saying... because of the nature of how it is set up, where it has a, you know, it's effectively answerable, a European army is answerable to the United States, with Britain separate.
from the European defence community. And de Gaulle is saying there's no way that London would ever accept what it is now suggesting we have to accept as France. And of course, the Americans would never accept it. And he rages against that. And when the National Assembly vote down...
the European Defence Community, they break out into the Marseillaise, while Jean Monnet, the founding father of Europe, is in the public gallery watching on. And at that moment, he resigns as, well, not at that moment, but soon after he resigns. as president of the European coal and steel community. And from that moment, you get Messina and the beginning of the European economic community in the common market. So, you know, that moment is absolutely crucial. But it does strike me, Helen, that...
One key difference here is that what you have, the kind of spectre, as you put it, that hangs over... British and French politics is one of future German strength. The Germany that exists then is obviously weak but they fear future German strength and then it's the Americans effectively making Germany strong again. So it's about how to manage that.
What we have now is a potential for future German weakness that is a core structural vulnerability, I think, for the whole of Europe. And we've talked about this on previous episodes about the, and you've said it out today, about the... The challenge, the fundamental challenge for Germany being really quite existential now about how it manages the energy transition. You know, Nord Stream 2 has been blown up, the relationship with Russia, where it got.
a lot of its energy from has broken down entirely because of the Ukraine war. The threat now from Germany is absolutely existential because it essentially has become a giant greater Germany producing the kind of things that Germany once produced.
The numbers, when you look at them now, the number of manufacturing jobs being lost in Germany is startling. The scale of the German stagnation is really quite remarkable. Five years now, potentially. I think they're talking about the official forecasts of... for growth of 0.3% next year. So you're really talking about stagnation now lasting six years.
And as we've set out, I think, in this episode, is the challenges that German politics have of managing, of breaking out of that. It's not obvious how they're going to break out of that in any sense. So I think a core question for Europe now is not just about the American withdrawal, if that is what we're going to see. I still think that's unclear, by the way. I think we should say that there is, you know...
When we are trying to analyze the American position under Trump, we said this last time, didn't we, Helen? It's very difficult to make any long-term sweeping predictions. You know, what we may be seeing is an American power play. to negotiate better terms on this Ukrainian minerals deal, which could then unlock a completely different American position when it comes to its negotiations with Russia. We're just not sure.
But central to this, whether America withdraws or not, is going to be this question of German economic strength and whether what Europe will...
be thinking about over the next decade is actually German weakness. I think one of the things that's really interesting here is that if you go back to the 2010s period, The reason why there's such reluctance in Germany to respond to the pressure that first the Obama administration and then the Trump administration is placing on Germany to increase defence expenditure is because...
They haven't got a mindset that thinks that there's a need to spend more money on defence. And that isn't just the free riding on the United States, though it is part of that. And they can say, well, the United States didn't withdraw from... Germany in terms of troop commitment after the end of the Cold War. It's because they don't think that Russia is a military threat. The whole premise of the Merkel position and before that under Schroeder.
and even perhaps under the latter part of coal, is that Russia is a partner, and particularly a commercial partner for certain of the big German industrial companies. So why are you going to spend more money on defense? to defend against Russia. Now, the answer that the Americans are sort of hinting at is, well, look what's going on in Ukraine. And that's sort of even true during the first, like, Trump...
where they are increasing the weapon dispatch to Ukraine. So the Germans are having to do something that they geopolitically don't believe in. But then... The Germans received the shock that they do on the 24th of February of 2022, so three years ago. Schultz makes his speech in which all this is supposedly light. internalized they move in certain ways they're not completely to break the russian energy dependence and now
who we are like three years on, where the Americans are saying, look, we are not going to help you deal with a Russia security threat issue that the Germans themselves now believe in. Yeah. Because the consequence of having to break the first Russia policy is loss of access to cheap energy from Russia, cheap gas in particular, and making themselves more dependent.
on American liquefied natural gas, this moment of supposed independence from the United States comes when energy dependence on the United States is higher than it's ever been for Germany in the post-war world. not just in the last things, but in the entire post-war world. So where gas is concerned, there is no point in which Germany is needed. the United States as much as it does. And yet this is still the moment where Mertz is to say, well, we have to be independent.
not just Germany, but for Europe, because the question mark over the security guarantee is now so intense. Even if it turns out not to be the case and that Trump's not going to do anything that dramatic in the next year or so, the possibility that he could is enough to mean that nobody knows.
or nobody can trust that the security guarantee holds. And that's why it's so hard, because if this had happened like five years ago, it's a different proposition than it is when it happens now. Well, if the Europe had... changed its policy when Robert Gates was telling it to change its policy, then perhaps it wouldn't be in the situation that it is today, or the decision wouldn't be so acute, because as I mentioned before, they didn't get to 3%, which is what was necessary to replace.
conventional forces to make the conventional force able to respond in the way that was necessary. They didn't get anywhere near that. No European power apart from Poland as we... Some of the Baltics did. Some of the Baltics. So I guess they're the ones that have faced the most acute threat.
who kind of internalized the scale of the threat. I think we're going to have to leave this episode here. But the way you've just described it there, Helen, makes me think that the conventional wisdom of the last... you know 48 hours week or so has been that it's going to lead towards European autonomy. Some kind of, you know, Europe is going to get its act together. It's going to have to. It has no choice. And that is, in some senses, being reflected in what Mertz has said since the election.
But there is another future, which is not that at all, which is that actually Europe is going to get more dependent on the United States. It's going to become weaker. both in relation to the United States, but also in relation to Russia and to China. And I include the United Kingdom in this as well.
It just will not get to a position where it has any independence, as Mert says it, from the United States, because it's not just a question, as you've said, of defense, but energy, of trade, you know, of all this. We haven't even talked in this episode really about the looming threat. of Donald Trump's tariffs on Germany and how that is going to exacerbate the situation even further if he really does push the button on that. So all of this point to, you know, stark realities, don't they?
for European politics, which I think I'm not sure they have been internalized yet. I mean, I internalize them the more I speak to people who are panicking in positions of power. So we're going to have to leave it there. Thanks so much for tuning in.
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