Plus: Language of the day
IN TODAY’S EDITION
1️⃣ Why Germany’s government just collapsed |
2️⃣ A state in Malaysia wants a border wall |
3️⃣ Language of the day |
Hi Intriguer. Years ago at a major summit in Lima, Barack Obama walked over to personally thank some Peruvian diplomats for their work behind the scenes. Those officials had 15 seconds with the most powerful man in the world, and you know what they said? They thanked him for slightly normalising US ties with Cuba.
It’s an issue that resonates across Latin America, and Argentine diplomats won’t have spared a second thought when they again cast their country’s vote against the US embargo on Cuba at the UN last week. But within hours, Argentina’s new-ish president had fired his foreign minister, and announced an audit of his country’s foreign service to “identify promoters of anti-freedom agendas”. And that’s now rattled more than a few Argentine diplomats, with its echoes of life before democracy returned in 1983.
Anyway, I mention this as an example (if we even needed one this week) of how quickly our world’s political winds can change. And you can see that also in the collapse overnight of Germany’s coalition government, our top story for today.
The latest from post-election US.
Kamala Harris has congratulated Donald Trump on his victory, as final counting suggests Republicans ended up winning all swing states. Meanwhile, US stocks have soared to record new highs in anticipation of Trump’s business-friendly policies, and questions continue to swirl around Ukraine: the Biden Administration is now reportedly rushing to deliver the last $6B in military assistance before inauguration day, while there are reports Trump’s team is considering continuing US support to Ukraine in return for a delay to its NATO membership.
Israel-Hezbollah fighting continues.
Israeli strikes have left 40 dead in the eastern Lebanon governorates of Baalbek and Bekaa, while Hezbollah has reportedly launched 170 rockets into Israel, killing one. Meanwhile, an IDF briefing has reported that Israeli ground forces are getting closer to “the complete evacuation” of northern Gaza, in what seems to be Israel’s first official acknowledgment that a complete evacuation is its objective. Israel says it’s necessary to combat regrouped Hamas units in the area.
Ireland calls snap election.
Prime Minister Simon Harris has called a snap election for November 29: he’s hoping to capitalise on a popular recent tax windfall rather than wait until the March deadline to dissolve parliament. Harris enjoys a comfortable lead in the polls.
Australia to ban social media for under 16s.
The government will soon introduce new legislation aiming to ban children under 16 from social media platforms to safeguard their mental health and safety. Meta (Facebook and Instagram) has pushed back, saying this should be for parents to decide, and that app stores (rather than the apps themselves) should be responsible for verifying a user’s age.
Hurricane Raphael hits Cuba.
The island has suffered another nationwide blackout after the category three hurricane made landfall. Cuba’s last major blackout a few weeks ago lasted several days.
TOP STORY
Why Germany’s ruling coalition just collapsed
Remember group projects? Everyone’s there, technically working together, but barely clicking on the same Google doc tab? Just awful. But that’s exactly what Germany opted for with its ‘traffic light’ coalition government between three parties back in 2021.
And why did that coalition just collapse? Three reasons.
First, the coalition itself was an uneasy arrangement. The main characters included:
-
🔴 Chancellor Olaf Scholz of the centre-left Social Democrats (SPD), the diligent overachiever who seized power after Angela Merkel retired in 2021
-
🟡 Finance Minister Christian Lindner of the business-friendly Free Democrats (FDP), the young and ambitious gun who’s tight with the purse-strings but loves the limelight, and
-
🟢 Foreign Minister Annalena Baerbock of the Greens, the rising star now strutting the global stage as chief diplomat after overcoming a plagiarism scandal.
Now, for anyone still stuck in two-party US politics, welcome to Berlin, where various parties must form coalitions to survive in the Bundestag. That’s how you end up with such an unlikely trio as the one above: different visions demanding different priorities.
Second, the job itself is tough and getting tougher. The DAX (a blue-chip German stock index) offers a few data points just over the last year:
-
🏗️ Steel titan Thyssenkrupp is lowering profit forecasts while it’s engulfed in a leadership crisis
-
🚗 Automakers Volkswagen and BMW are facing weak demand and steep competition from China, with VW sounding the alarm on historic layoffs
-
🛞 Tire giant Continental is now looking to sell business units to help balance its books, and
-
🚢 Shipyard Meyer Werft just snagged a last-minute government bailout to avoid bankruptcy.
These are different firms with different issues, but they all point to Germany’s core challenge: its manufacture + export business model is under pressure from greater competition abroad (China) and declining productivity at home (exacerbated by the Russia-induced energy squeeze).
Add Russia’s war on Europe’s doorstep, plus the US electing a Euro-and-NATO-sceptic president with a penchant for tariffs, and that’s a messy in-tray for any government, let alone a messy ‘traffic light’ government like the one above. Which leads us to…
Third, we are morally and legally obliged to use one random German word whenever discussing Germany, and today’s word is ‘Schuldenbremse’, or debt brake. Germans enshrined it in the constitution 15 years ago, limiting deficits to 0.35% of GDP.
Its backers (like the spendthrift Finance Minister Lindner) see this brake as sacrosanct, curbing inflation and keeping Germany’s finances in shape. Its detractors (increasingly including Chancellor Scholz) argue the brake prevents Germany from responding to crises and investing in its future.
That division has been bubbling away within the coalition but exploded into public view over the past week, culminating in Scholz firing Lindner last night (Wednesday). Which leads us to…
Fourth, the timing. Why now?
On current polling, Lindner’s party wouldn’t even have a place in parliament after next year’s elections, so he might’ve pushed things to a head now in hopes of getting a role in whatever coalition comes next (the main opposition bloc is actually his traditional partner).
There was also a sense maybe Trump’s return might force more unity within Germany’s coalition, but instead, the pressure just cracked it. Germany is now bracing itself to shoulder more of the burden if Trump hits pause on US support for Ukraine. For Germany, that requires more cash, which goes to the heart of the Schuldenbremse debate above.
So, what next? Scholz says he’ll continue to run the show with his other coalition partner (the Greens) in a minority government, cobbling together parliamentary majorities to pass laws as needed until January 15. That’s when he’ll call a parliamentary confidence vote on his government. Depending on what happens, there might then be snap elections in March (six months earlier than scheduled).
It’s a risky bet for Scholz, with an 18% approval rating and populist parties on the left (BSW) and right (AfD) nipping at his heels.
INTRIGUE’S TAKE
The EU has three times Russia’s population and ten times its GDP. If it wanted to shape Putin’s war more in its own favour, it probably could. But that takes time and will, both of which seem limited right now.
On time, Europe has now had three years, if you wanted to start the clock at Putin’s full-scale invasion; or ten years if you wanted to start at Crimea; or 16 years if you wanted to start back at Putin’s invasion of Georgia. But while improving, its security posture still doesn’t come close to matching its economic and demographic heft.
And then on will, just as the US potentially begins pulling back its own support, there are signs the EU’s largest economy by far (Germany) is now turning inwards, not just to manage this latest political impasse above, but also to (for example) block an Italian takeover of a German bank, or deploy more checks at Germany’s borders.
Of course, it’s not all one way — Germany is also deploying more troops to fellow EU and NATO member Lithuania, for instance. And nor is Germany alone — other EU members have shown similar signs of an inward turn. But whatever it is, it doesn’t seem enough for what Germany – and Europe – now confront.
Also worth noting:
-
Germany has taken in more than a million refugees from Ukraine since February 2022, costing a reported $21B in accommodation and integration services. Germany is also Ukraine’s #2 backer after the US.
-
If you’re wondering what Angela Merkel is up to these days, she has a memoir coming out on November 26 — Freedom: Memories 1954-2021. Say what you like about Merkel, but she always had impeccable timing.
MEANWHILE, ELSEWHERE…
-
🇲🇾 Malaysia: A Malaysian state bordering Thailand is pushing for the construction of a 100km wall to help tackle smuggling and to stop young locals crossing illegally into more liberal Thailand to party. Many youngsters apparently sneak over to Thailand’s Sungai Kolok entertainment district, which is just a few blocks over the border.
-
🇩🇪 Germany: Iran is now claiming German-Iranian dissident Jamshid Sharmahd died of unspecified causes rather than as a result of the death penalty last week. But Germany is reiterating that Iran kidnapped him from the UAE, detained him for four years without trial or medical care, and is responsible for his death.
-
🇦🇺 Australia: Former PM and current Australian ambassador to the US, Kevin Rudd, has announced he’s deleted various old negative posts about Donald Trump. Australia’s conservative opposition has previously flagged Rudd should resign in the event of a Trump victory, but Rudd says he looks forward to working with Trump.
-
🇲🇽 Mexico: Mexico’s navy has announced it seized 3.6 tonnes of cocaine aboard a boat 246km (153 mi) off the resort of Acapulco. The smugglers were in a purpose-built ‘go-fast boat’, which uses powerful outboard engines and a semi-submersible design to avoid detection.
-
🇲🇿 Mozambique: South Africa has closed its main border crossing with Mozambique following reports of vehicles being set alight over on the other side. Deadly protests have rocked Mozambique since the long-ruling Frelimo party claimed re-election in questionable elections last month.
EXTRA INTRIGUE
Meanwhile, in other worlds…
-
Sports: A man has shattered the record for, um, the fastest-ever marathon in Crocs. Count us impressed.
-
Space: Japan (via SpaceX) has put the world’s first wooden satellite in orbit, as part of a longer-term plan to build timber houses on the Moon and on Mars.
-
Tech: Artificial intelligence pioneer OpenAI has acquired the ‘chat.com’ domain, which was first registered back in 1996.
LANGUAGE OF THE DAY
Credits: Nyimas Laula, The New York Times.
The sprawling archipelago of Indonesia is home to at least 700 living languages, and The New York Times just wrote an interesting piece about one of them: Cia-Cia, spoken by around 93,000 people on Buton Island.
Lacking a written form, conservationists have long tried to preserve Cia-Cia by helping alphabetise it, but options like the Arabic script haven’t really fit. Then, two South Korean researchers visited Buton in 2009, starting a process that’s culminated in around 40 fourth-graders now learning their mother tongue with the help of Hangul, the Korean alphabet.
DAILY POLL
What do you think about Australia's social media ban for under 16s? |
Yesterday’s poll: What do you think will be the biggest international impact of Trump's victory?
🟨🟨🟨🟨⬜️⬜️ 💪 Peace through US strength (19%)
🟨⬜️⬜️⬜️⬜️⬜️ 🇨🇳 More tension with China (9%)
🟩🟩🟩🟩🟩🟩 🚢 Disrupted trade ties with allies (28%)
🟨🟨🟨⬜️⬜️⬜️ 📉 Less US presence abroad (13%)
🟨🟨🟨🟨⬜️⬜️ 🇺🇦 Less support for Ukraine (22%)
⬜️⬜️⬜️⬜️⬜️⬜️ 🇮🇱 More US backing for Israel (4%)
🟨⬜️⬜️⬜️⬜️⬜️ ✍️ Other (Write in!) (5%)
Your two cents:
-
🚢 R.B: “Protectionism will start massive tit-for-tat tariffs being implemented and the bottom line is everything will increase in cost 😪”
-
🇺🇦 C.D: “It's not just Trump. Republican legislative candidates were also campaigning against US support for Ukraine, pandering to grass roots dissatisfaction with the money spent there…”
-
💪 D.L: “China is the greatest existential threat to democracy globally and we need to do a LOT more to address that threat. I believe that Trump will help us avoid direct conflict with China, or alternatively be better positioned to win such a conflict.”
-
✍️ E: “All of the above (except peace) AND loss of hope for the climate.”
-
✍️ K.K: “There will be a shift in world order and the dismantling of American imperialism, not because Trump has moral objections, but because he is likely to be isolationist.”
Was this forwarded to you? We're a team of ex-diplomats producing a concise and engaging geopolitical briefing for 100k+ leaders each day. It’s free to subscribe.