The Missing Truth in the German Campaign

Germany’s election campaign is in full swing now that Chancellor Angela Merkel is back from her hiking vacation in the Alps. She’s way ahead in the polls and likely to join the handful of European Union leaders who’ve won re-election since Europe’s economy tanked. She’s maybe the only one who dares ask voters, “Are you better off now than when I took office?”

Amazingly, given the state of the rest of the euro area, the answer is yes: Germans have more jobs than in 2005. The unemployment rate has roughly halved, to 5.4 percent; inflation is low; and the budget deficit is close to zero. The news that the German economy grew by 0.7 percent in the second quarter has probably sealed her victory on Sept. 22. Now, the issue is less whether she wins but how. And that’s a two-part question.