German Election 2025: Why It’s A Wake-Up Call for Europe

by Claude Forthomme – Senior Editor

February 25, 2025

For the electorate, as the German election results clearly show, the issue that mattered most was migration, an issue also known as “refugees and asylum”. That was generally seen as more important than “protection of the climate” or “pensions.” Yet most important of all were “peace and security,” “social justice,” and the “economy,” or to put it more precisely, the lack of investment, the threat of stagnation, of falling out of the digital tech and AI revolution led by America.

Indeed, the “economy,” thus broadly defined, matters. As Beata Javorcik, the chief economist of the European Bank for Reconstruction and Development (EBRD) told Euronews yesterday in the latest “The Big Question” interview, “If you don’t move forward, you fall off the bike.” Europe is suffering from an acute lack of investment in R&D.  That risks leaving it behind on many levels, as Draghi also warned in his now famous report that underpins the EU Commission’s latest plan for Europe, the “Competitivenes Compass.”  

Recently, Draghi doubled down on his warning in a speech to the European and national parliament members last week. He pointed to the present challenges coming from Trump’s America, which has gone from a trusted ally to a wily, unpredictable adversary, saying that Europe should  “act as one state” and the problem is that European competitiveness was choked not just by red tape and overregulation but also systematic underinvestment.

One month into the second Trump presidential term, Trumpian policies have only succeeded so far in bringing chaos and dismantling the world order, returning the world to a pre-World War II situation of nation-states fighting each other for supremacy. Tariff wars and 1930s-style beggar-my-neighbor policies would figure in the best scenario, and full-scale war with the eventual deployment of nuclear weapons as happened in Hiroshima and Nagasaki in a worst-case scenario. 

Moreover, as the war in Ukraine is showing us after three long years, we are “celebrating” or rather deploring today the start of the invasion, on February 24, 2022. There is still no victory for the aggressor, Putin’s Russia, despite all the destruction and many deaths, but none for Ukraine either. The support from the West was always too timid, far below what was needed for Ukraine to win.

Let’s dig deeper into the matter, starting with a closer look at what is happening in Germany. It is, after all, the EU’s biggest member country, and without Germany fully playing the game, nothing can be achieved in Europe.

German election results: Veering to the extremes and the rise of AfD

As the German elections results clearly show, with a voter turnout of 84%, the largest since reunification, the rise of extremes was confirmed, both on the right and the left:  Die Linke on the far left obtained 8.8% of the votes (and 64 seats in the Bundestag), up from 4.9% in 2021, but it was AfD that made it big this time.

Afd sailed to unprecedented victory, with a 10% boost in new votes, becoming the country’s second party behind the conservative CDU/CSU, with over 20.8% of the vote and 152 seats in the Bundestag.  

In short, both extremes, taken together, account for nearly 30% of the votes. And that’s a concerning percentage of the German electorate, showing the extent of voter discontent and radicalization.

The CDU/CSU is not that far ahead of AfD, with only 28.6% of the votes, conquering 208 seats, a mere 56 seats more than the AfD —well below its historical level, which is a matter for concern— while the SPD, Chancellor Olaf Scholz’s Social Democrat Party, did very poorly, collapsing to third place, with 16.4 % and the Greens, right behind, with 11.6%. 

How did the AfD do it? By focusing on an issue everyone else was neglecting: migration. And it worked. Here is a DW analysis of so-called “voter migration”, showing how AfD managed to draw voters from the other parties, and especially from CDU/CSU: 

Notably, the party that “bled” the most voters to AfD is CDU/CSU. That’s historically former Chancellor Angela Merkel’s party. The reason for this bleeding? Simple, Angela Merkel’s immigration policy mistakes did too little to assimilate migrants — one of whom went on a terrorist rampage during the Munich Security Conference — and clocked up all the wrong things, in the end energizing the extreme right.

The widespread theory that sees AfD’s victory grounded in its ability to bring forward the migrant issue —sometimes recklessly calling for absurd measures that go against international law and the Geneva Conventions signed by Germany, like returning ALL immigrants to their home country, including political refugees—- has more than a grain of truth. 

It is quite clear that most of the German electorate is deeply worried about immigrants, and when one of them goes on a rampage killing people, it’s not considered an aberrant behavior by some lunatic but something that characterizes all immigrants and only serves to show AfD is right. 

The difficult task ahead for Friedrich Merz, the new Chancellor

Friedrich Merz will do well to avoid Merkel’s mistakes. The task might be easier for him because at least one inconvenient player was forced out of parliament: Christian Lindner, head of the Free Democratic Party. He was the Federal Minister of Finance from 2021 until his dismissal in 2024 during the 2024 German government crisis and announced yesterday that he would be retiring. Not a surprise, given the disastrous results of his party that didn’t even make it over the 5% bar needed to enter the Bundestag. 

From the start of the Ukraine War, Lindner regularly called for withdrawal or diminishing support for Ukraine, contributing to the lack of support coming from Germany—and that, as we saw again during last summer’s lackluster offensive, it has so far prevented Ukraine from winning the war.  

Lindner was merely continuing the catastrophic neo-liberal policies of his party that had shackled Merkel, notably in addressing the Greek debt crisis following the 2008 Great Recession and, later, in 2015, the immigration crisis. 

Such policies, based on strict supply-side economics and zero public debt, were more deleterious for Germany than most people realized, effectively killing investment in research, especially tech innovation, but also in public infrastructure and military expenditures. The latter was made possible by the fact that Germany took advantage of NATO and the US nuclear umbrella, thus feeling little need to spend its own funds on national security. 

Also, such policies shackled the EU, as Germany engaged in systematically killing any proposed move toward creating a European capital market. This, in turn, caused EU member governments to scramble to survive the brakes on economic growth that such policies inevitably entail. 

As a result, Europe continued to fall behind America, and now everyone can see how it has been bypassed by the AI revolution.

Compared to America, Europe appears like a midget in the more commonly used statistics. For example, according to the World Bank, 2023 per capita GDP adjusted for purchasing power in the United States is more than one-third higher than that of the EU, at $81,695 vs. $60,350. Disposable incomes also favor the U.S. 

But all that neatly overlooks the fact that poverty levels are much higher in the US than in the EU and the American population is very far from enjoying the same social security benefits. Now, with Trumpian policies and DOGE cuts, it is poised to lose the little social protection it had. 

Another common trope is that Americans are more productive than Europeans. However, adjusting the data for the time actually worked vs. leisure shows that this is not the case. The Economist did just such an exercise in 2023 and found that while the EU economy was 65% the size of America’s in dollar terms, down from 90% a decade ago, GDP per person is higher in Europe and has grown far faster than in the United States. In particular, EU countries Austria, Belgium, Denmark, Luxembourg, and Sweden along with non-EU Norway and Switzerland had “eclipsed” by a large margin the US per-capita GDP. 

As to the drop in size, it was attributed partly to the strong dollar and partly to slow population growth: the number of Europeans has risen by only 1.6% since 2012, compared with 6.1% for Americans. So, while Europe is still a smaller market, it’s no midget and at this rate, could surpass America if it adopted the right economic and foreign affairs policies.

Which way will the new Chancellor go?

It is too early to tell, but we have some early signs of where Mr. Merz might be headed. He recently expressed openness to the idea of sharing the French or British nuclear umbrella, and today he announced that he sees “independence of Europe from the US”as a top priority (watch his announcement here). 

That is encouraging, as it would appear that he not only listened to Draghi’s message but made it his own. It will be recalled that only a few days ago, on February 18, Draghi delivered a powerful keynote speech at the European Parliamentary Week 2025, warning: 

“We can expect to be left largely alone to guarantee security in Ukraine and in Europe [and] to cope with these challenges, it’s increasingly clear that we need to act more and more as if we were one state.” Adding, “The response must be fast because time is not on our side. With the European economy stagnating, while much of the world grows.” 

So, given the time pressure, how will Merz organize the new government of what is, after all, the most important state in the European Union?

Negotiations to form the government will surely be challenging, and Merz promised he would be done by April. Since he’s ruled out the more obvious solution —a coalition with the SPD, Mr. Sholz’s party —it will be an especially difficult task, as a glance at the next Bundestag shows:

It is too soon to predict how this will all play out. But the stakes are high. 

Merz will need to play a tight game and not dismiss or mishandle two essential issues: immigrants and investment to jumpstart European competitiveness. The two issues are related: Much of the migrant problem can be solved by the economic integration of the immigrants, but to succeed, this requires booming markets with plenty of job opportunities to satisfy both population groups, the natives and the migrants. 

If Merz fails, that will put Germany within a step of joining Italy, which is already on the extreme right, with Meloni of the Fratelli d’Italia as prime minister. To the question of whether Meloni is a pragmatist ready to seek compromise and work with the EU or a die-hard populist who wants to see the EU dead, the (equally pragmatic) answer is the latter and not the former. 

Yes, PM Meloni is definitely someone who’d rather see Russia and America sailing aheadinstead of Europe. Consider how she reacted to EU Commission President von der Leyen’s invitation for Italy to join the EU-led EU-led IRIS² project, indicating her preference to continue with Elon Musk’s Star Link, the Space X satellite system. Of course, this was to be expected: Musk has famously become a buddy of all far-right politicians—not just Meloni but also AfD’s co-leader Alice Weidel. 

And these populist, nationalistic, extreme right parties in Europe are not in it to actually govern or solve problems: All one needs to do is see how Trump merely sows chaos and dismantles existing programmes that run well . A prime example of this is the dismantling of USAID, despite the fact that it was a highly effective soft power weapon in the American arsenal. 

Extreme right party leaders are not in politics to find solutions and ways to collaborate with others. Whether led by Trump in America, Giorgia Meloni in Italy, Vicktor Orban in Hungary, Marine Le Pen in France, Geert Wilders in the Netherlands, Jimmie Åkesson in Sweden, Santiago Abascal in Spain, Riikka Purra in Finland, Herbert Kickl in Austria (and I’m skipping many EU countries here), such parties focus on complaining about the status quo, saying “no” to constructive ideas and being notoriously anti-European, anti-immigration and, overall, generally supportive of Putin and his expansionist Euroasian Dugan-inspired policies, of which the Ukraine war is exhibit number one

If Merz can put all this in his agenda, find workable solutions and succeed in solving the issues that are presently fueling the extreme right – and a German Chancellor has at his disposal a lot of power – then expect him to counteract the rise of AfD successfully. 

If all goes well, this could signal the end of political extremism and its false promises not only in Germany but in the rest of Europe.

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This article was originally published on IMPAKTER. Read the original article.