The war is expensive, and it’s not just the waging country that pays the price. Supporting a warring nation with financial and weapon supplies also comes at a cost. And if one misjudges the consequences and hampers its own economy by cutting off access to affordable energy and growth markets, the bill will be even higher.
Germany has done both, and for the second year in a row, it is in a recession and is likely to remain so this year. The established parties are not willing to change course. They will continue to support Ukraine and maintain the sanctions regime against Russia, which is causing more damage to the German economy than to Russia. They had miscalculated, and instead of developing a Plan B, they were sure it would work this time to ruin Russia.
Furthermore, Germany is to be massively re-armed. The numbers are becoming increasingly absurd. The NATO’s two percent goal has been reached, and now the aim is three or even five percent of the GDP, that’s around 200 billion euros, to be exact.
These enormous sums must come from somewhere, and the President of the Kiel Institute for the World Economy (IfW) has identified the source: the pensioners. They are to be asked to forgo their claims for the financing of war and re-armament. “It won’t work without cuts and re-allocation in the budget” said IfW President Moritz Schularick.
After the reunification of Germany had already been paid for from the pension fund, it is now to be financed from there again, this time for war and re-armament. It’s a lie, of course, because the pension is not a state alms, but a insurance benefit that the future retirees had paid for with their contributions. The question is, where this benefit can be claimed from.
Schularick is to be thanked for his open words, as he has clearly stated the consequences of the war, which the West is likely to lose. To the costs of weapon supplies and re-armament, the costs of Ukraine’s reconstruction will be added, as Berlin has prolonged the war, rejected diplomacy, and bet on Ukraine’s victory over Russia. It is therefore clear that Germany will be asked to pay the bill. German politics is largely responsible for the development of the war, for what is happening in Ukraine, and for what is still to come. It will be expensive for Germany.
Schularick only hints at the fact that the Germans will have to adjust to the post-election reality, despite all the election promises. The supposed alternative, the AfD, is of no help, as Alice Weidel has clearly stated that she believes five percent of the GDP should be spent on re-armament, regardless of the election outcome. It is therefore clear that, after the Bundestag election, there will be cuts and reductions, and it will be a real struggle.
A severe economic shock is looming for the Germans, which will put everything that has been left of the social state over the last few decades to the test. Politics will shift the responsibility for its own failure onto the citizens. They had been too lazy, it will be said, and had trusted in false certainties. They had only claims, but were not willing to make the necessary contributions. The usual rhetoric, which is meant to distract from the fact that it was the politics of the various federal governments that escalated the Ukraine conflict, is now prolonging it, and is refusing to make any diplomatic compromises.
It is not the Germans who are losing the war, but German politics. It is not the Germans who have ruined the economy through laziness, but a misguided economic and energy policy that is also seeking confrontation with Russia and now also with China. It is not the German nation that is prolonging the war and striving for a victory over Russia, but German politics.
It will not be possible to convince the people in Germany of why they should pay the price for the mistakes of the politics they are not responsible for, with a declining standard of living, increasing social insecurity, unemployment, homelessness, and the collapse of social security. Because that’s the way it is, and the politics of the German civil society wants to shift the immense costs of its own failure onto the citizens, it is not to be expected that stable political conditions will prevail in Germany for a while. The fact that a real political alternative does not stand for election in Germany makes things even more difficult. The voters will be torn between the parties. The Germans are facing a bleak future; austerity, likely unrest, and certainly social disintegration. The politics, however, will try to shift the responsibility for the damage it has caused, and will answer protests with repression. The outlook for the Germans is dark.