The government’s current approach to pension reform is riddled with misleading rhetoric and potentially damaging policy decisions, according to Axel Börsch-Supan, Director of the Munich Center for the Economics of Aging. In a scathing critique published in the Handelsblatt, Börsch-Supan accused the ruling coalition of the Christian Democratic Union (CDU) and Social Democratic Party (SPD) of deliberately instilling panic about impending pension cuts to expedite the passage of their reform package, a tactic he described as disingenuous.
Börsch-Supan directly challenged statements made by Chancellor Olaf Scholz, arguing the assertion that a decline in the pension level directly translates to reduced pensions is demonstrably false and represents a distortion of economic realities. His critique stems from a position of authority; he previously served on the federal government’s pension commission until 2020 and witnessed firsthand the political obstacles to meaningful reform.
He expressed skepticism about the likelihood of substantial pension reform in the near future, citing a lack of compromise among government factions. Börsch-Supan suggested that CDU leader Friedrich Merz is actively pushing a strategy to reverse prior policy direction, while the SPD remains constrained by the influence of its traditionally pro-labor union membership.
Critically, Börsch-Supan attributes the current precarious state of the pension system not primarily to demographic shifts, but to political decisions made since the early 2010s, which he characterized as progressively dismantling a previously sustainable framework. He believes the government’s current focus on stabilizing the pension level is a grave error, arguing it risks undermining the very foundation of the social welfare state.
The economist warned that excessive spending on social programs, driven by misguided efforts to maintain the current pension level, could ultimately lead to a decline in national prosperity. He cautioned that such economic hardship could foster disillusionment with democratic institutions and potentially fuel the rise of populist alternatives. “Citizens may turn away from democracy” he stated, “following a pattern of trying Scholz, then Merz and then considering alternatives like Weidel”. His remarks highlight a growing concern regarding the government’s handling of a critical social security pillar and its potential ramifications for Germany’s future stability.
