Is the once economically strong Germany in financial meltdown?

Is the once economically strong Germany in financial meltdown?

Theologia Houtou

Political chaos, the removal of Christian Lindner.

Chancellor Olaf Scholz wants to ask the Bundestag for a vote of confidence in January and pave the way for new elections in March. Scholz previously dismissed Finance Minister Christian Lindner from governmental responsibility.


Political chaos has arisen due to the removal of the leader of the Free Democrats (FDP), Christian Lindner, from the governing coalition in Germany.

What is the source of the disagreement?

Lindner’s removal came over disagreements over economic policy, which had led to lingering tensions within the governing coalition.

Scholz said he had asked Lindner to loosen fiscal rules to allow more aid to Ukraine, along with the Greens and Social Democrats in favour of a looser economic policy, seeking greater spending on environmental projects, social policies and digital upgrading, at a time when the German economy is facing recession and a decline in industrial production, but Lindner refused. He also criticised Scholz’s perception of Germany’s economic weakness. Lindner stated: “Olaf Scholz has long failed to recognise the need for a new economic awakening in our country. He has played down the economic concerns of the citizens”.

Vice-Chancellor Robert Habeck expressed regret at the disruption of the government alliance. “This seems wrong and not right,” said Robert Habeck, the Greens’ economy minister on Wednesday night in front of the Chancellery gate after the election of Donald Trump as US President, “Germany must show unity and the ability to act in Europe”. According to Habeck, the biggest solution would be to give more support to Ukraine. The FDP was not prepared to go down this road.

The collapse of the government creates uncertainty about the future of Germany. Lindner reportedly proposed that the parties, as in 2005, should jointly seek new elections in early 2025 as soon as possible to enable a new government for Germany. Meanwhile, Scholz  is expected to lead a minority government with the Social Democrats and the Greens, the second largest party. For the last 40 years at least, “politicians” are generally not chosen based on their abilities but based on how popular and recognisable they are. The overwhelming majority of Germans see the dissolution of the government coalition positively. The majority favours faster procedures for calling elections, rejecting the timetable announced by Chancellor Olaf Scholz for polls in March.

On the “Political Barometer”, the second channel of the German public television program on ZDF, 84% are in favour of holding early elections, with only 13% expressing the opposite opinion. The question is: will anything change for the citizens by holding new party elections? Because those who control the mainstream media can very easily shape the common opinion about persons or situations, serving their own interests.

What are the implications for Germany and its economy? Internal instability? Social reactions? Political instability may intensify social discontent, with recession and inflation already putting pressure on the middle class. Possible cuts or changes in economic policy may affect social benefits.

The political crisis and uncertainty in Germany will probably also affect the entire European Union because of the country’s leadership position and its influence on the EU’s economic policies. It may affect markets and the stability of the euro, creating uncertainty in economic forecasts for the Eurozone, especially if markets react negatively. νIn addition to a new political leadership, it could also signal changes in Germany’s attitude towards immigration, an issue that affects the entire EU.

The reasons for the plight of the German economy are many and difficult to resolve. The country faces many challenges simultaneously: a demographic problem and consequent lack of skilled workers. High energy prices that reduce the country’s competitiveness, resulting in a delay in investment. And finally, increasing competition from countries like China and India.

Uncertainty about economic policy has also restrained consumer spending.

Moreover, the forecasts of economists for the path of development in Germany are not favourable for attracting investors either, which is weak and has already lagged behind other Eurozone countries over-indebted from continuous lending in the secondary market, sinking its economy deeper and deeper into recession.

The once economically strong Germany is now facing economic collapse. Does this also apply to the EU? Is there a solution?

Yes there is, if the EU changes its attitude politically, making it a priority to solve the real issues that European citizens have created by the decisions made in implementing the green agenda, immigration, the Russo-Ukrainian war and of course, to break free from the economic trap that forces it to pursue a policy against the citizens of the old continent.

The financing of the EU must be done from a healthy fund to recover the entire Union and this can only come from Greece with Greeks in the administration-Government of the Nation (Ethnos) – with a strong portfolio delivered by the President of the Political Body of the Hellenic Nation, Mr. Artemis Sorras.

The European parliamentary candidates of the “Hellenic Assembly” (Ellinon Syneleysis) asked for our vote in the European elections of June for the opportunity through the European Parliament to reveal the immense amounts of all country’s assets and how, with the guarantees of Mr. Artemis Sorras, they can claim them for the rights of all people. A fact that all European citizens must know.

People, the time has come for you to decide about your life and not some political parties whose politics have failed miserably.

“Citizens of every country, the time to unite is now!!!”

Translated by Themis Ioakimidis

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