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Paul Taylor, a contributing editor at POLITICO, writes the “Europe At Large” column.
With only six weeks to go until polling day for the most open and unpredictable German federal election in decades, it is personalities, disasters and micro-scandals about resumé padding and plagiarism that have so far dominated the campaign.
Yet prosperous Germany faces a raft of looming problems that deserve more serious debate — some of them highlighted by faltering responses to the COVID-19 pandemic and recent deadly floods. But politicians and the media are mostly dodging them.
Climate change; depopulation; a fraught industrial transformation and clean energy crunch; and chronic underinvestment in infrastructure, digitalization and housing are among the dull but vital issues that await Chancellor Angela Merkel’s successors.
To be sure, the flash floods that killed over 180 people in western Germany last month have put the fight against climate change at the top of the political agenda. But many other pressing risks are still to be debated.
Instead, the campaign trivia contest has thus far prominently featured Christian Democrat Armin Laschet’s inappropriate laughter, which was caught on camera as the president commiserated with flood victims; Greens candidate Annalena Baerbock’s exaggeration of early work experience on her CV and late declaration of party bonus payments; and allegations that both Baerbock and Laschet plagiarized content for their books.
But Europe’s most powerful economy is heading for a demographic crisis in the coming decades, with an aging and dwindling population and shrinking workforce. According to the Federal Statistics Office’s most recent projections, the German population could slump from 83 million today to 74 million in 2060 if net immigration remains low.
More alarmingly, by then there will be 11.8 million fewer Germans of working age (21 to 67) but 5 million more of retirement age. A doubling of annual net immigration to 311,000 might stabilize the overall population at its current level — that is, if the birth rate were to remain as is. But even then, there would be 5 million fewer workers to pay the pensions of 5 million extra retirees. And a further fall in the birth rate would widen that gap even more.
Economists and business leaders fret about these long-term trends, which will exacerbate labor shortages and strain pensions and health care systems. But many politicians are still reacting to the public backlash against the influx of nearly 1 million asylum seekers in 2015, thus promising fewer migrants, faster vetting and more expulsions of rejected asylum seekers.
Germany also faces huge challenges when it comes to the economy, transforming the 20th century industries on which its post-war miracle was built to reach a carbon-neutral future. Yet this issue is often reduced to symbolic disputes over imposing a nationwide speed limit on autobahns, banning domestic short-haul flights, raising the cost of cheap holidays to Mallorca or making city centers car-free.
And while the Greens have succeeded in making climate change and environmental protection compulsory issues for all parties, they struggle to shake off the image of a Verbotspartei — a party of prohibitions — bent on banning the motoring, travel and smoking pleasures so dear to many ordinary Germans.
When the Greens were last in government in the early 2000s, Germany rashly chose to phase out low-carbon nuclear power faster than heavily polluting coal. This has left the country painfully short of clean energy: Intermittent wind, solar and biomass power only fully meet the country’s electricity needs eight days a year. Facing a shortfall of secure energy supply from 2023, Germany will have to import power from its neighbors during peak periods.
Merkel accelerated the atomic switch-off after the 2011 Fukushima reactor disaster in Japan, but bureaucracy and public resistance have largely prevented Berlin from building the necessary smart grids to bring wind-generated power from north Germany to the industrial west and south, as well as extending its intercity high-speed rail network.
This is also partly due to shortcomings in public administration — which is understaffed and a generation behind in terms of digitalization — as well as to the complexities of the federal system. For example, when the pandemic struck, COVID-19 statistics had to be collected by fax machine because local health authorities were not networked. Home-working and schooling were also handicapped by lack of computers, VPN access and high-speed broadband.
Where countries like France and Italy were able to swiftly decide on lockdowns, curfews and social distancing rules, each decision in Germany was subject to prolonged haggling among the country’s 16 state premiers, each responsible for health care and policing. Merkel often struggled to ensure science prevailed over politics. Some states enforced rules more strictly than others.
Next, in terms of housing, Deutsche Bank economists reckon the country needs at least 1 million extra homes. About half of Germans currently live in rented accommodation, and the shortage of apartments has forced market rents up by an average of 35% in the last decade — even more in big cities such as Berlin.
Finally, all the key projects to make Germany fit for the 21st century require large-scale public investment, as well as harnessing the private sector. But public investment is severely constrained by a constitutional debt brake adopted at the outset of the global financial crisis in 2008.
Both Laschet and Social Democratic candidate Olaf Scholz, the current finance minister, have vowed to reimpose the temporarily suspended borrowing corset as soon as the pandemic is over, probably starting from 2023. This makes absolutely no sense at a time when global investors are willing to pay the German state to borrow their money. Yet mainstream politicians obsessed with fiscal prudence can’t wait to tie their own hands again.
From climate and clean energy to creaking public infrastructure, Germany’s complex, decentralized governance system faces a slew of underlying problems that ought to be getting serious debate.
This is the first election since 1949 in which the incumbent chancellor is not seeking reelection, and it should be an opportunity for bold thinking as well as new faces. Yet it seems most Germans would rather bury their heads in the sand than tackle the stark challenges clouding their country’s future.
We can only hope the campaign turns to the nation’s real problems before September 26.
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