Interview with Friedrich Merz

Mr. Merz, has Germany become a nation of grumblers?

We do lean toward pessimism rather than opti­mism, at any rate. To the Germans, the glass is usually half-empty. To the Americans, on the other hand, the glass is always at least half-full!

“Crisis has become the favorite word of our era.” You know who came up with that quote? It was Norbert Blüm, and he said it in 1985. It seems that our eagerness to talk up a crisis is not just a contemporary trait.

And meanwhile, the proposed solutions have remained largely the same. If a problem arises some­where, then the solution is to spend more money. If there is an administrative issue, the first reaction is to hire more staff. Constant increases in public administration staff, ever greater demands on the public purse – this cannot continue indefinitely.

Mr. Merz, during a 12-year hiatus from politics, you were chair of the supervisory board at BlackRock, the world’s biggest asset management corporation. A question, therefore, for the man from industry: At what point does spending equate with sensible investment?

Public money is well-invested when it fulfills the social contract of the Basic Law of the Federal Republic of Germany (Grundgesetz, GG), when it safeguards the internal and external freedoms of the people and, what’s more, when it flows into the national infrastructure. The benchmark for this should be an increase in national wealth. It’s crucial that the younger generation feels the benefits.

You have remained married for 41 years, an almost indecent period by today’s standards − and what’s more, to the same woman. You have three children and six grandchildren. What will their future in Germany look like?

None of the six have come to any decision as individuals; they’re still a little young for that. But this generation will be asking themselves a question that is more urgent than ever: what kind of future can our country offer? If the figures are correct, estimates say that even today some 180,000 German citizens, often well-educated young people, leave our country every year, and only about two-thirds ever return. There’s a lot of talk about immigration. But maybe we should also be catering for those who want to emigrate because they see better opportunities for the future elsewhere.

Do you think outward migration from Germany is a real problem?

If I’m correct, there hasn’t been enough research into the phenomenon as yet, nor do we know enough about people’s motives. And the balance of migration has been positive for many years: Ger­many’s population is growing. At the end of 2021, we were taken completely by surprise when we saw that the population of German stood at 84.2 million people − not the 81 or 82 million that we had assumed. To this day, we don’t know how many people from other European countries are living and working amongst us on a short- or long-term basis. If necessary, we could work this out by labo­riously sifting through data from health insurance providers − but even then, the figures would not be sufficiently reliable. Our system of registration is still stuck in a more or less analog era. I would much prefer to work with more solidly based data. After all, our infrastructure needs to be more precisely tailored: daycare centers, schools, hospitals, homes.

So we are flying blind when it comes to infrastructural measures: What kind of Germany do you foresee for your grandchildren as they grow up?

The war in Ukraine has brought one thing to the fore, at any rate − we can no longer assume that they will spend their lives in a free, democratic and peaceful Europe. But that would be paramount.

A Christian country?

One whose cultural characteristics are based on Christian and Western traditions, in any case.

A country of immigration?

That’s what we have been for a long time already, but hopefully we will become one that regulates immigration on a much more successful basis.

How can Germany source more skilled workers?

As well as boosting the potential number of skilled workers at domestic level, it is crucial that Germany can attract talent in from abroad. We are proposing a new federal immigration agency to handle immigration by skilled workers − the “Work and Stay” agency. This will be a one-stop shop where skilled workers can access the entire service: everything from job placement, checks on entry requirements and help with any necessary visas, right up to organizing legal residence status once they arrive in Germany. The federal immigration agency will take over all immigration procedures currently carried out by the German missions abroad and by the immigration authorities of each district and municipality, with the exception of asylum pro­cedures. Right from the start, the work of this immigration agency will be carried out on an exclusively digital basis, and it will be equipped with the latest technologies. It will also act as a job placement agency for all workers from other European and non-European countries.

What kind of working life will your grandchildren experience?

Presumably, one that is very much more digital and mobile. And more varied. In contrast to their parents and grandparents, they won’t be selecting a career, remaining in it and staying until retirement.

Do you worry about the future?

I believe our country is still dynamic and strong enough to solve a lot of issues very successfully. What I’d like to see from our country’s political leaders is more optimism about the future. Too often, Germany hides its light under a bushel. That’s something that strikes me every time I go abroad. Whenever I return from any foreign trip, my interactions there always send me home with the impression that our fellow nations’ expectations of us are higher than what we actually deliver. And we believe the opposite: that we do not have to deliver as much those other countries out there really expect of us. We play down our image, in contrast to how we are actually viewed from outside.

As you see it, are we minimizing ourselves to the point of negligence?

Yes, to some extent.

What is your assessment of our coun­try’s innovative strength?

In some cases, breathtakingly good. We have established AI institutes in Germany; we have seen tremendous developments in the area of the latest technologies; and we are a country with the potential to make great strides in the fields of both hydrogen and regenerative technologies. We are a country with excellent biotechnology expertise − think of BioNTech, think of CureVac. To remain with this examples: As soon as both of those companies get big enough to really start producing, they need capital − so where do they turn? To the stock exchange in New York. That in itself is not an ideal situation. What I really find problematic, though, is another issue, and clearly, it is one that barely occurs to anyone in this country. It hardly even comes up as a topic for discussion. To look at the other end of the scale, a company like Linde delists from the German stock index because it has grown too big, yet this story is consigned to the back pages of the financial press.

What sort of contribution can or should research be making to a worthwhile future?

The planning process has to be streamlined: not just for projects like wind turbines, but also for the expansion of digital infrastructure. Ulti­mately we have to ask ourselves this question: In ten years’ time, where do we want our strengths to lie? Pharma, biotechnology, mechanical engineering, environmental technologies, artificial intelligence and the combination of digitalization and decarbonization − potential for new value creation is everywhere all over the industrial hub of Germany. The social market economy and competition bring forth the great­est innovations. That is the only way to maintain our prosperity. However, apart from providing the necessary infrastructure, it is also necessary to make progress in the processes already ini­tiated by the previous government, like online access to public services and data handling.

On the subject of innovative strength: As a keen pilot, when do you see yourself fly­ing under hydrogen power?

Hard to say. Based on my own assessment, at least, I’ll probably stick with synthetic fuels. Hydrogen is still very problematic in flight operations. Fueling has to take place at temperatures of well below zero and under conditions of extreme pressure.

Do you get the impression that research in Germany has a sufficiently broad focus?

I see a lack of willingness to examine every side of an issue, which is also a feature of our socio-political debate. We exclude many things too early on. And we phase things out before we know what we will be phasing in instead. We phased out nuclear energy − some 12 years ago − and yet we still don’t know what we will replace it with. Now we are phasing out combus­tion engines. And we don’t know what will take their place: Electromobility could be the answer. Or hydrogen. Or synthetic fuels. Or maybe the future of mobility lies in all of them working in together in parallel. This mindset, where we start at the level of highly ideological discussion, doesn’t appeal to me. It is reckless of us to don blinkers. We end up excluding technological developments that we are not even aware of yet. The economist Friedrich August von Hayek called this the pretense of knowledge. A very good term for it. Would we still decide to phase out nuclear energy today? We can be fairly sure we wouldn’t. Was it right for Germany to ignore the dual fluid reactor and allow its purchase by Canadian investors? Again, probably not.

Would you call this an impassioned plea for greater openness around technology, Mr. Merz?

Yes, that’s the right expression. But we have to imbue that concept with meaning, and not fixate on individual cases. Politicians need to light the spark of self-confidence and openness for this country. The Germans have a highly developed sense of security. At some point, though, we must be prepared to take a leap into the unknown. This demands trust in our political leaders.

Who will be the next chancellor, Mr. Merz?

We already have one. And we are engaging with him.

You count among the usual suspects as a candidate to succeed him.

I’m honored.

More than half of the ten previous CDU leaders have gone on to become chancellor.

I could live with that.

But what is your party’s position? In 2022, you yourself described the CDU as a “difficult political renovation project.”

We now find ourselves in the second of three phases. Phase one was consolidation of our role in opposition. After the poor election result in 2021, we embraced this role successfully. But if we aspire not just to be the opposition of today, but the government of tomorrow, then we must abandon this mode of just being the opposition. We have to flick the switch and highlight what we want to do better. That is a task for the party and the Bundestag parliamentary group. Since last year’s four state elections, I have therefore been focusing much more intensively on the party. We are right in the middle of a renewal process.

Phase two, as you call it.

Which will conclude in May of next year, in good time for the 2024 European election and the 2025 Bundestag election.