Skip to content
Search

Latest Stories

News

Enter Olaf — can he keep Germany’s traffic light blinking?

Enter Olaf — can he keep Germany’s traffic light blinking?

German Chancellor Olaf Scholz attends a news conference in the Federal Chancellery following the video conference with the country's 16 state leaders on the surge in the coronavirus disease (COVID-19) cases, in Berlin, Germany, December 9, 2021.

Michael Kappeler/Pool via REUTERS

As of this week, for the first time since Gwen Stefani was topping the charts with Hollaback Girl, Germany is not run by a person named Angela.

Olaf Scholz — the pragmatic, robotic, determined leader of the center-left SPD party — now holds the reins of Europe’s largest economy.

But he also leads a three-party coalition, the first in Germany’s modern history, with the progressively, climate conscious Greens and the business-friendly fiscal hawks of the Free Democrats party. The coalition is known as the “traffic light” owing to the colors of its three members.

Here are a few immediate and longer-term challenges for Scholz.


His first big test is COVID. Germany is currently in the throes of its worst surge since the onset of the pandemic. Between the upcoming Christmas holiday and uncertainty about the omicron variant, Scholz has his work cut out for him. So far he has not announced any new society-wide lockdowns or restrictions. But with Germany’s vaccination rate of 70 percent now an EU laggard, he’s embraced a broad vaccine mandate and wants to get 30 million jabs done by the end of the year.

Foreign policy: Russia on day one. Scholz comes into office right as tensions around Ukraine are soaring again. He will quickly have to stake out a position towards Moscow that satisfies German industries, which rely on Russian markets and energy, but that also reflects the views of the Greens, Russia hawks who see the Kremlin as a menace both to the climate and to democracy. With the Greens’ leader Annalena Baerbock as foreign minister, this is going to be a tough balance to strike.

A crucial near-term decision for Scholz is whether he is willing to include suspension of the Nord Stream 2 Russian gas pipeline project as part of a package of German sanctions meant to deter Russian aggression against Ukraine… at a time of sky-high gas prices.

Going green without getting into the red. Scholz’s government has pledged a massive push on the climate front, promising to phase out coal entirely by 2030, eight years earlier than originally planned, and to double the renewable share of electricity generation to 80 percent by then as well.

These goals are practically existential for the Greens, but getting there will require massive investment — where’s the money going to come from? Scholz has already pledged to reimpose constitutional limits on debt, and the Free Democrats, who control his finance ministry, are opposed to raising taxes.

A bigger question: Can Scholz make social democrats cool again? The SDP victory was something of a stunner for a party that had seemed, just months ago, like it was on the brink of extinction. What’s more, across Europe traditional labor-oriented parties have suffered in recent years.

Now Scholz has a chance to prove that the traditional European center left has some fight in it, at a time when the right — in both its centrist and populist versions — has been defining the landscape for the last decade. Scholz believes the SPD can reconnect with working-class voters — and his coalition’s pledge to raise Germany’s minimum wage for about 10 million people is an immediate part of that.

About a third of EU member states are currently run by social democrats of one stripe or another. They will be watching to see if Scholz can use the bloc’s largest economy as a showcase for the center-left’s bonafides after a long time in the wilderness.

The unknown unknown: the next crisis. Will it be immigration? A terror attack? A financial meltdown? A political scandal? Scholz’s predecessor didn’t come into office as a crisis manager, but she sure left as one. How the new German chancellor holds together his somewhat oddball coalition under unforeseen pressures could prove decisive.

More For You

​Then-US President George W. Bush with then-People's Republic of China President Jiang Zemin following their meeting at Bush's ranch in Crawford, Texas, on October 25, 2002.

Then-US President George W. Bush waves as he stands with then-People's Republic of China President Jiang Zemin after the two gave statements to the press following their meeting at Bush's ranch in Crawford, Texas, on October 25, 2002.

Twenty-five years ago, Destiny’s Child, NSYNC, and Britney Spears were atop the US charts, “Google” was a little known search website with a weird name, and two things happened that would shape the world we live in today, where populism defines politics and great power competition is back. First, Congress passed a bill that paved the way for China [...]
U.S. President Donald Trump holds a signed executive order on AI next to Sriram Krishnan, Senior White House Policy Advisor on Artificial Intelligence on December 11, 2025.

U.S. President Donald Trump holds a signed executive order on AI next to Sriram Krishnan, Senior White House Policy Advisor on Artificial Intelligence on December 11, 2025.

REUTERS/Al Drago
38: Large tech firms will be celebrating after US President Donald Trump signed an executive order aimed at undercutting the ability of states to introduce regulations on artificial intelligence. Thirty-eight states have adopted AI laws. Trump’s order aims to just have one federal law be the standard. [...]
​December 9, 2025, Rome, Italy: Italian politicians from parties +Europa, Democratic Party, Azione, Europa Now gather to welcome Ukraines President Zelensky with a banner made up of 27 EU flags and the Ukrainian flag.

December 9, 2025, Rome, Italy: Italian politicians from parties +Europa, Democratic Party, Azione, Europa Now gather to welcome Ukraines President Zelensky with a banner made up of 27 EU flags and the Ukrainian flag.

Marco Di Gianvito/ZUMA Press Wire
EU poised to unfreeze Russian cash for Ukraine aidThe EU is set to indefinitely freeze more than $247 billion in Russian central bank assets today, clearing the path to use the money to keep Ukraine funded as the war grinds on. The move would end the precarious six-month renewal cycle — and reduce the chances of Kremlin-friendly countries like [...]
​Miami Mayor-elect Eileen Higgins points as she thanks her staff and supporters on the night of the general election, on Tuesday, Nov. 4, 2025.

Miami Mayor-elect Eileen Higgins points as she thanks her staff and supporters on the night of the general election, on Tuesday, Nov. 4, 2025.

Carl Juste/Miami Herald/TNS/ABACAPRESS.COM
For the second time in a month, Republicans lost a mayoral race in a state US President Donald Trump has called home. This time it happened in Florida.Democrat Eileen Higgins defeated Republican Emilio González in Miami’s mayoral election on Tuesday to become the first female leader of Florida’s largest city, and the first Democrat to win this [...]