Garvan Walshe: Merz is known to be mercurial. He needs to harness that to bring Germany the change it needs.

Garvan Walshe is a former national and international security policy adviser to the Conservative Party. He is founder of Article7 – Intelligence for democrats

After Olaf Scholz, the immovable object disguised as Chancellor of Germany, those of us used to faster paced political cultures may have raised an eyebrow at descriptions of his successor Friedrich Merz as “mercurial”.  Compared to Olaf Scholz, the Stone of Hamburg, who wouldn’t qualify?

A less impulsive man wouldn’t have been moved to declare, a little after JD Vance’s notorious speech attacking this side of the Western Alliance, “independence from the United States”. Merz’s remark, at the “elephant room” post-election party leaders’ debate, was a refreshing outburst of truth for a political culture that has for some years now failed to confront the fact that it has fallen behind the times.

Yet, his difficulties in getting voted in as Chancellor by the Bundestag (the lower house of the German parliament), hint that his impulsive nature won’t necessarily serve him well in managing an extremely tight parliamentary majority. The German governing coalition, including Merz’s Christian Democratic Union, their associated Bavarian Christian Social Union, and the centre-left Social Democrats, has a tiny majority of 12, in a parliament of 630. By comparison John Major won a majority of 21 in a similarly sized House of Commons in 1992.

The tightness of his majority claimed its first victim — Merz himself — who failed to win the 316 votes needed to be sworn in as Chancellor, despite the coalition having 328 available. Because the vote for Chancellor is a secret ballot, we cannot say exactly who failed to show up, but the fact that there were at least 18 of them (conceivably, MPs from other parties could have supported him) leaves room for disgruntled elements of each of the coalition’s component parties.

The pro-Kremlin wing of the SPD is the most obvious culprit, irritated by his huge rearmament plan; but CSU deputies annoyed by Merz’s repudiation of Germany’s “debt brake”, which used to ban significant borrowing, or female MPs from the CDU itself who consider his largely male cabinet a “boys’ club” could also have used the vote to send Merz a warning.

More ominous than losing the first vote itself was the fact that there were so many plausible rebels.  He was rescued on Tuesday by the Greens and Die Linke (The Left) who provided the 2/3 majority needed for a second vote to take place immediately (it would normally not have been allowed until Friday) and has now entered office.

He inherits an anxious Germany in need of change the previous government spent three and a half years failing to deliver. Its political and economic model, often summarised as Russian gas, American security, and Chinese export markets is obsolete. It has become ashamed of its backwardness in software and connectivity. Its train network is the butt of jokes in Eastern, never mind Western, Europe. The country is now in recession, and Germany’s carmakers, and in particular Wolkswagen, are terrified of the Chinese lead in electric vehicles.

Exploiting this stagnation is the AfD, which has added frustration at high handed and bureaucratic Covid and environmental policies to its traditional opposition to immigration. This party, which has now been designated “extremist” by the German courts, came second in the elections, with 21 per cent of the vote. Another 4.9 per cent voted for the Maurice Glasman-esque “left conservative” BSW, led by Sara Wagenknecht, who generously let her party use use initials. Both of these anti-system parties are strong in the former East Germany.

Weakening them (the CDU/CSU lost 1.2 million voters to these parties at the elections) will be the government’s imperative. Merz believes he can kill three birds with one stone. First, he and the new leadership of the SPD, notably including defence minister Boris Pistorius, see eye to eye on rearmament and Ukraine. Second, the need for rearmament provides a way to save the internal combustion supply chain, which is being made obsolete for civilian purposes by the advance of electric vehicles. 

As automotive engineers are moved from car plants to tank plants, cheap Chinese electric vehicles are converted from a threat to jobs into an inexpensive form of decarbonisation. Questions remain over the future of mass vehicle manufacturing in Germany. It is unclear whether mid-market car companies like Wolkswagen can compete, and the German car industry may evolve into one in which high-end production by Mercedes, BMW and Porsche dominates. Nonetheless military expenditure, provided baroque German defence procurement proceses can be simplified, could prevent a large part of the deindustrialisation of Western Germany that the AfD would otherwise exploit.

Merz also needs to bring the rest of the German economy into the 21st century. He needs to provide the impetus for digitising the public sector, and promoting the advanced clean energy technologies that German firms have developed but struggle to install because of extremely difficult planning requirements and heavy bureaucracy, ironically often enacted to protect the environment.

In these areas, his emotional nature could turn out to be an asset. It will provide the creativity and determination to overcome groupthink and vested interests. Provided he learns how to keep his coalition’s feathers unruffled.