After 30 years as a bastion of political and economic sanity in Europe, Germany is once again approaching the kind of disaster scenario it thought it had left behind forever. An energy supply crisis, runaway inflation, threats of nuclear war in Europe, attacks on energy infrastructure in the Baltic Sea, increasing diplomatic isolation, a collapsing economic model, and rising populist politics— Berlin’s worst nightmares all seem to be coming true at once. How Germany responds will have consequences not only for German voters but for Europe as a whole, as well as for global stability.
It is hard to exaggerate how shocking these circumstances are for most Germans. Germany has built an admirable society based on a high degree of social trust, a robust social security system, and low inequality. That post-reunification Germany was able to become the world’s fourth-largest economy in such a short period of time is due in large part to its highly competitive industrial exports, which kept voters happy and politics boring.
But ever since the pandemic-induced economic crisis began in 2020, and especially following the economic tremor of Russia’s expulsion from the Western trade and financial system in early 2022, the German model has been revealed as something of a pyramid scheme. Far from a resilient system that can adapt to external disturbances like pestilence and war, the Germany economy depends on cheap Russian gas, reliable Chinese supply chains, and large foreign export markets.
Now, Germans are watching in disbelief as steel, fertilizer, and chemical plants are closing or on the brink of shutting down. German automakers are being forced to consider moving domestic production to countries where energy is cheaper.
Large German hopes have been pinned on green hydrogen as the future of the energy landscape, but as soon as it had to become a solution to an industrial problem rather than a climate problem, hydrogen now looks less attractive. If Germany, no longer has access to cheap energy—either from nuclear power or from pipeline-bound cheap gas—then energy-intensive production may increasingly move to where cheap energy is located. Rather than move green hydrogen across the globe to supply a steel mill in Germany, for example, firms may just move their plants to the Middle East, or to other EU countries where, thanks to nuclear power, green energy supply may soon exceed power demand.
These are the kinds of disruptive economic changes that have led to populist political movements across the Western democratic world, from Britain and the United States to Italy and France. And indeed, the far-right Alternative für Deutschland (AfD) now polls as the most popular political party in all five states of the former East Germany.
This is not a reassuring development for Germany’s neighbors, who are already smarting until the diplomatic clumsiness of the government of Chancellor Olaf Scholz. In response to the energy crisis, for example, Scholz recently unveiled a national subsidy that was uncoordinated with EU allies and thus seen as sabotaging their own efforts. The chancellor has so far taken a high-handed attitude to their fury.
As kanzlerin for 16 years, Angela Merkel attempted to readjust Germany’s position by warming up to (and benefiting from) a rising China, a supposedly declining America, and what she and the German establishment thought of as a revived Russia. Scholz, who served as Merkel’s Finance Minister, largely shared this vision. But with China more inward-looking and hostile to foreign companies and imports, the United States growing closer to Northern, Eastern, and Central European countries as a result of the war in Ukraine, and Russia all but ostracized from the Western economic order, the Merkel-Scholz plan is now in tatters, and Germans feel increasingly alone and uncertain in a terrifying world.
This is the political and psychological baggage with which Germans are approaching Vladimir Putin’s mounting threats to use nuclear weapons in Ukraine.
The United States has indicated that a Russian nuclear attack could trigger NATO’s Article 5 collective defense clause on the grounds that radiation would spread from Ukraine to NATO territory, like Poland. It would only take a small tactical nuclear explosion on the Ukrainian battlefield, or even perhaps an “accident” at the Russian-occupied Zaporizhzhia nuclear plant, to end 77 years of the international nuclear taboo. This is why US national security adviser Jake Sullivan recently warned that, “We have communicated directly, privately, and at very high levels to the Kremlin that any use of nuclear weapons will be met with catastrophic consequences for Russia, that the US and our allies will respond decisively.”
If Putin did go through with his nuclear threat, in other words, there is a distinct possibility that it could lead to a NATO attack on Russia or Russian military assets in Ukraine or the Black Sea. Frank-Walter Steinmeier, the President of Germany and a leading member of the ruling Social Democratic Party, has publicly vowed that Germany will never participate in armed hostilities with Russia, implying a special German exemption from NATO’s Article 5 commitment of mutual assistance. Scholz has never disavowed such claims.
Both Steinmeier and Scholz come from a long line of Russophile German leaders who see the two countries’ destinies as inextricably linked, and Germany as the only country that understands the “Russian soul.” Putin, who began his career as a KGB officer in East Germany and speaks fluent German, knows the Germans better than they know him. He has good reason to believe that they would be prepared to violate their treaty obligations to NATO, if push came to shove.
Putin sees his place in Russian history not only as the man who will have reclaimed lost territories, but as the man who will have finally defeated the hated “West.” If a tactical nuclear strike in Ukraine might cause NATO to break part and the EU to fracture over support for Ukraine—to say nothing of causing markets to crash and an economic depression in Europe—Putin’s threats may not be as empty as we all hope.