Leading economist Axel Börsch-Supan has leveled a scathing critique of the German government’s pension policy, accusing the ruling coalition of the Christian Democratic Union (CDU) and Social Democrats (SPD) of deliberately instigating public anxiety about potential pension cuts. In an interview with the “Handelsblatt”, Börsch-Supan dismissed assertions, including those made by Chancellor Olaf Scholz, linking a decline in the pension level directly to reduced payouts as “simply false.
Börsch-Supan, who previously served on the government’s pension commission until 2020, expressed pessimism regarding substantial pension reform in the near future, citing a lack of willingness to compromise within the ruling parties. He pointed to what he perceives as contradictory messaging, noting that CDU leader Friedrich Merz is instructing his parliamentary group to reverse course while simultaneously pushing policies that exacerbate the problem. He also attributed the SPD’s reluctance to reform to internal pressure from its traditionally union-aligned membership.
The economist argues that the looming financial instability of the pension system is not primarily driven by demographic shifts, but rather the result of political decisions. He claims the system was fundamentally sound in the early 2010s, before subsequent government actions progressively undermined its stability.
Börsch-Supan considers the current government’s objective of stabilizing the pension level to be a detrimental error. He warns that prioritizing social spending at the expense of economic growth risks undermining the foundations of the social welfare state and potentially fostering widespread disillusionment with democratic processes. “Citizens may turn away from democracy” he cautioned, highlighting the potential for resentment if repeatedly failed promises lead to a shift in political sentiment. He suggested a hypothetical scenario where voters might consider alternatives like Alice Weidel’s Alternative for Germany (AfD) in response to perceived governmental mismanagement and unfulfilled promises.