{"id":541318,"date":"2025-11-01T04:48:31","date_gmt":"2025-11-01T04:48:31","guid":{"rendered":"https:\/\/www.europesays.com\/uk\/541318\/"},"modified":"2025-11-01T04:48:31","modified_gmt":"2025-11-01T04:48:31","slug":"german-government-prepares-assault-on-social-spending-scapegoating-immigrants","status":"publish","type":"post","link":"https:\/\/www.europesays.com\/uk\/541318\/","title":{"rendered":"German government prepares assault on social spending, scapegoating immigrants"},"content":{"rendered":"

On October 14, Chancellor Friedrich Merz denounced immigrants as a \u201cproblem in the urban environment<\/a>\u201d that had to be solved through more deportations. Since then, debate over his statement has not subsided and it is becoming ever clearer what the chancellor aimed to achieve with his racist tirade.<\/p>\n

Friedrich Merz [AP Photo\/Ebrahim Noroozi]<\/p>\n

Merz and his government, a coalition of the Christian Democrats (CDU\/CSU) and Social Democrats (SPD), are preparing for ferocious conflicts with the working class. They are planning a frontal assault on social benefits on which millions depend for their existence. Such an offensive cannot be carried out by democratic means. They are therefore making migrants the scapegoat for the consequences of their own policies and drawing deeply from the propaganda arsenal of the far-right Alternative for Germany (AfD). In doing so, they are deliberately strengthening the far right, because they need it to divide and suppress the working class.<\/p>\n

Financial crisis of the municipalities<\/p>\n

Merz\u2019s reference to the \u201curban environment\u201d was not accidental. The devastating consequences of the federal government\u2019s austerity policy are most evident in the municipalities. With annual spending of \u20ac363 billion (as of 2024), the municipalities spend only \u20ac100 billion less than the federal states and \u20ac200 billion less than the federal government. However, they can finance only a small part of these expenditures from their own revenues and are dependent on substantial transfers from the federal and state governments.<\/p>\n

Years of austerity and the impact of the debt brake have reduced these transfers, while new tasks are constantly being transferred to the municipalities. As a result, social spending\u2014mandated by federal laws\u2014has more than doubled since 2009. It now accounts for over 40 percent, and in some regions up to 65 percent, of municipal budgets.<\/p>\n

As a consequence, hardly any municipality is still able to make the necessary investments in dilapidated schools, crumbling roads, libraries, leisure centres, nurseries, social services and other socially essential facilities. The situation has deteriorated dramatically over the past two years. The combined deficit of all German municipalities reached \u20ac25 billion in 2024\u2014a fourfold increase in just twelve months! For this year, a shortfall of \u20ac35 billion is expected.<\/p>\n

\u201cDeficits of unprecedented magnitude are piling up, rising cash credits are triggering a debt\u2013interest spiral, and investment is collapsing,\u201d warn the municipal umbrella associations. \u201cThe federal financial architecture is completely out of balance.\u201d<\/p>\n

In a letter to Chancellor Merz (CDU) and Finance Minister Klingbeil (SPD), the German County Association wrote: \u201cCities, districts and municipalities have never been in such dire straits.\u201d Investments, it said, were plunging despite additional federal funds.<\/p>\n

Under the headline \u201cA storm is brewing over the municipalities\u201d the\u00a0Frankfurter Allgemeine Zeitung\u00a0reported: \u201c\u2018Genuinely\u2019 balanced municipal budgets (that is, without drawing on reserves) have become an absolute exception across the country. In a survey conducted at the start of the year among member municipalities of the German Association of Cities and Towns, only 6 percent said they had managed this. In 2024, the figure had still been 21 percent.\u201d<\/p>\n

Merz and Klingbeil have no intention of helping the municipalities. The stranglehold with which they are choking off municipal finances serves to shift the enormous costs of rearmament, war and the enrichment of the wealthy onto the working population.<\/p>\n

Hundreds of billions for rearmament<\/p>\n

Klingbeil\u2019s medium-term financial plan envisages taking on new debt of \u20ac850 billion by 2029\u2014a record amount. This massive mountain of debt is intended to prepare the Bundeswehr (Armed Forces) for war against Russia and make Germany\u2019s infrastructure \u201cfit for war.\u201d The budget therefore contains a gap of more than \u20ac170 billion, which Klingbeil plans to close through cuts at the expense of the working class.<\/p>\n

In the municipalities, he can rely on an all-party coalition of all the establishment parties\u2014including the Left Party and the AfD. Whatever their public posture towards the federal government, in municipal councils they all implement its austerity diktats. Even if they occasionally complain, not one of them is willing to mobilise any opposition.<\/p>\n

The main beneficiary of this all-party coalition of social cutbacks is the AfD. The far-right party now has several thousand representatives at municipal level and is the strongest party in some eastern states.<\/p>\n

Just a few days ago, a conference of 500 AfD municipal politicians took place in Berlin, at which MP Stephan Brandner ranted against \u201cmigration madness\u201d and \u201cclimate nonsense.\u201d Rhineland-Palatinate state parliament member Joachim Paul boasted that at the municipal level, one no longer needed to break down firewalls: \u201cIt\u2019s enough just to blow them over.\u201d AfD MP and former mayor of J\u00fcterbog Arne Raue praised: \u201cNo one helps us grow more than the establishment parties.\u201d<\/p>\n

The state governments, regardless of their political composition, are likewise implementing the federal government\u2019s radical austerity course. Although the debt brake has prohibited them from taking on new loans for five years, the states are still carrying \u20ac610 billion in debt\u2014almost a quarter of total public debt, which stands at \u20ac2.5 trillion.<\/p>\n

They are now drastically cutting education, culture and social budgets.\u00a0Berlin\u2019s universities<\/a>\u00a0alone must save \u20ac145 million this year. Ten percent of study places\u2014around 25,000 in total\u2014are to be cut, and staff budgets sharply reduced. The situation is similar in other federal states.<\/p>\n

The cuts at municipal and state level are only the tip of the iceberg. The most sweeping attack on the welfare state is being prepared at the federal level.<\/p>\n

Business associations and the media are pushing for massive cuts to pensions and health spending. \u201cEven stabilising social expenditure will be difficult enough without benefit cuts; anyone wishing to reduce it must proceed drastically,\u201d writes finance weekly\u00a0Wirtschaftswoche, calling for the abolition of the mothers\u2019 pension and early retirement without deductions, and for a reduction in the benefit level. \u201cThe same applies to health and care; costs are rising almost unchecked.\u201d There are dozens of similar articles and studies.<\/p>\n

Merz: \u201cWe can no longer afford the welfare state\u201d<\/p>\n

In August, Chancellor Merz declared: \u201cWe can no longer afford the welfare state<\/a>.\u201d The government, however, is proceeding step by step so as to dampen the expected resistance. It has outsourced the dismantling of pensions and healthcare contributions to commissions that are to draw up proposals, and as a first measure, decided to\u00a0abolish B\u00fcrgergeld<\/a>\u00a0(welfare support) and replace it with a basic allowance.<\/p>\n

The purpose of this measure\u2014which will save at most \u20ac5 billion\u2014is to pressure the unemployed into accepting virtually any job, no matter how poorly paid. Otherwise, they face cuts or the complete withdrawal of benefits. The same method was used by the \u201cHartz\u201d laws twenty years ago, which laid the foundations for a massive low-wage sector.<\/p>\n

The government\u2019s concern is not only the three million already unemployed, but also the tens of thousands losing their jobs each month. They are to be forced into taking low-paid work immediately. Labour Minister B\u00e4rbel Bas publicly calculated that the state saves \u20ac850 million per year if 100,000 fewer people claim basic support.<\/p>\n

<\/a><\/p>\n

According to Enzo Weber of the Institute for Employment Research (IAB), \u201cFor over two years, more than 10,000 industrial jobs have been lost every month.\u201d The auto industry is particularly affected. These are typically skilled, relatively well-paid jobs on which many other jobs depend.<\/p>\n

This jobs massacre is being intensified by the trade war with the US and China. Traditional manufacturers such as Ford and Opel (Stellantis) are now threatening to close their German plants entirely. VW, Porsche, Mercedes and other carmakers are also deep in crisis. Hardly a day passes without a small or medium supplier declaring bankruptcy or halting production. Added to this is the introduction of artificial intelligence, which is destroying countless jobs in administration and services.<\/p>\n

Stock markets explode<\/p>\n

So far, the government relies primarily on the trade unions to suppress resistance to the job destruction and social cuts. Their well-paid officials and full-time works council representatives draw up redundancy plans and suffocate every opposition to them. They present job and wage cuts as being necessary to keep German companies \u201ccompetitive\u201d in the global market.<\/p>\n

But their lie that workers and bosses are \u201cin the same boat\u201d becomes more transparent by the day. While workers\u2019 living standards have stagnated or fallen for years, stock prices, great fortunes and executive pay have exploded.<\/p>\n

Despite a stagnating economy and numerous bankruptcies, Germany\u2019s DAX index has hovered around a record 24,000 points since June\u2014more than double its level in 2020 at the height of the pandemic. The total market value of the 40 companies listed in the DAX is nearly \u20ac2 trillion.<\/p>\n

Stock prices remain high despite the economic crisis because speculators trust that the state will \u201cbail them out\u201d in any future financial crash, just as in 2007. Since then, virtually all wealth gains in Germany have gone to the richest layers. The number of billionaires has quadrupled from 42 to 171. Ten percent of households now own 56 percent of total wealth.<\/p>\n

At the same time, poverty is rising. In 2024, 15.5 percent of the population\u2014or around 13 million people\u2014were poor. Among young people aged 18 to 24, the rate was 25 percent.<\/p>\n

It is only a matter of time before these social contradictions explode. This is the real reason for Merz\u2019s turn toward the AfD. Around the world, the representatives of capital are turning to authoritarian and fascistic forms of rule as social tensions intensify. The same applies to Italy and France, and is seen most starkly in the United States, where Trump is establishing a presidential dictatorship based on fascist forces. The Democrats offer no resistance because they represent the same capitalist interests.<\/p>\n

Germany\u2019s ruling elite regards the US with a mix of fear and admiration\u2014fear of Trump\u2019s trade war measures, admiration for his iron hand against workers, migrants and the left. This holds true not only for Merz and the CDU, but also for Klingbeil and the SPD.<\/p>\n

The assault on social spending and the danger of war and dictatorship can only be stopped if the working class breaks with all the establishment parties and their accomplices in the trade unions, unites internationally, and takes up the struggle to overthrow capitalism and build a socialist society.<\/p>\n

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