“The last bullet of democracy” in Germany – can Merz deliver?
Germany is suffering from the EU’s most expensive healthcare system, stagnant growth and a pension system that is considered to be in urgent need of reform.
The government is plagued by internal battles – at the same time as the right-wing nationalist AfD is reaching record levels in public opinion.
– Despite just over a year of a new government, not much has happened, says political scientist Ann-Kristin Kölln.
The pension system, income tax, the labor market, healthcare and bureaucracy. A stated ambition for German Chancellor Friedrich Merz (CDU) and his coalition government with the social democratic SPD has been to agree on a series of reforms since the 2025 election.
The German welfare state is in need of change in several areas – and it is urgent.
– They need to get something done, says Ann-Kristin Kölln, professor of political science at the University of Gothenburg, about Merz’s government coalition.
– A new government was supposed to implement “an autumn of reforms”, but nothing major happened
then, and now we are in June.
A test for democracy
Ann-Kristin Kölln does not believe that any groundbreaking changes are to be expected before the Bundestag goes on summer break in early July. However, the coalition’s latest tactic, with negotiations in smaller groups and divided reform proposals, may bear fruit.
– They will agree somehow. It is a matter of give and take.
In parallel with the bickering in the government, the right-wing nationalist Alternative for Germany (AfD) has gained ground in public opinion. After last year's election, when the traditional major parties CDU/CSU and SPD only narrowly managed to secure a majority, Markus Söder, head of government in Bavaria and leader of Merz's Christian Democrats' sister party CSU, called the grand coalition "the last bullet of democracy".
- The best thing that the German government can do now is to deliver policy and show action. This could also be a good strategy to respond to growing support for the AfD, says Ann-Kristin Kölln.
Political deadlocks
There are many knots that Merz's government must untangle at the same time. The chancellor himself has called the current situation in Germany "the most challenging since the Second World War".
The German economy is stagnant - something that Merz has promised to change but where few concrete results have been presented. In terms of GDP, Germany's economy is still the strongest in Europe, and the third largest in the world, but it has been struggling since the pandemic. High energy costs, fuel prices and increased competition from China have hampered the export-dependent economy.
This spring, Merz's economic advisors downgraded the growth forecast for 2026 to 0.5 percent.
- This means that there is very little money in the system to use for the promised reforms. For the third year in a row, attempts have been made to boost growth, and the previous coalition also failed to find a good solution.
Merz's political style has also been the subject of debate.
- There are those who say that he needs to focus much more on domestic policy. Another criticism that Merz often receives is that he lacks tact in his rhetoric. He can express himself impulsively and in some situations is perceived as condescending, says Ann-Kristin Kölln.
Strong leadership for AFD
At the same time as the government is working out compromises, several state elections are coming up. In Saxony-Anhalt, the AFD looks set to make great strides, and could even win its own majority in September.
The right-wing nationalist and pro-Russian party is considered a security risk for Germany. The country's Federal Office for the Protection of the Constitution (BFV) has concluded that the party opposes the "liberal democratic basic order".
- There is a risk that the AfD will change the state apparatus in Saxony-Anhalt, that they will follow Trump's example and replace civil servants or abolish parts of the region's institutions. They could also try to withdraw the subsidy for public radio and television, says Ann-Kristin Kölln.
The party's rapid rise has brought the issue of democracy to the forefront of the debate.
- We know from research that support for democracies and democratic legitimacy is often driven by performance. If politicians do not deliver on what citizens demand and want, support for democracy will decrease, says Ann-Kristin Kölln.
FACTS
Complicated parliamentary situation
Germany has been governed since May 2025 by a coalition between the Christian Democrats (CDU/CSU) and the Social Democrats (SPD).
In the February 2025 elections, the SPD suffered a sharp decline, with its worst result (16.4 percent) since the 1880s. The Christian Democrats and their Bavarian sister party, the CSU, advanced compared to the disaster election in 2021, but to levels (28.6 percent) far below the results in previous elections since German reunification.
The far-right parties, the right-wing nationalist AfD and the left-wing party Die Linke, both advanced strongly, while the Greens retreated significantly.
The distribution of seats in the Bundestag barely made it possible to form a broad so-called grand coalition.
The next elections to the German Bundestag are scheduled for 2029.
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