Economist Schularick says Pistorius wastes €700 billion Bundeswehr budget on tanks and frigates

Misdirected billions

Moritz Schularick, president of the Kiel Institute for the World Economy (IfW), has accused Defense Minister Boris Pistorius (SPD) of setting the wrong priorities in arms investment. In an interview with the Süddeutsche Zeitung, Schularick said Pistorius is directing a large share of the €700 billion available through 2030 for Bundeswehr modernization toward tanks, frigates and other outdated technologies. The largely credit-financed program, which could stimulate economic growth if used correctly, risks fizzling out as a result, Schularick warned.

Future technologies over legacy hardware

Schularick argued that Germany possesses capital, industrial know-how and, in some areas, highly advanced technology, but lacks hundreds of thousands of people willing to climb into tanks and go to the front. He said the country should invest wherever possible in AI, robotics, drones and satellite technology rather than more soldiers, manned vehicles and barracks.

Statt auf mehr Soldaten, mehr bemannte Fahrzeuge und mehr Kasernen müssen wir, wo immer möglich, auf KI, Robotik, Drohnen und Satellitentechnik setzen.

A coordinator in the chancellery

A single, "very slow" ministry is overwhelmed by the reorganization of German and European defense strategy, Schularick said. He called for a central coordinator for military procurement to be installed in the chancellery (Kanzleramt), someone equipped with political authority who can bring together industry, start-ups and ministries, eliminate friction and focus everything on one goal.

Statt die klügsten Köpfe des Landes zusammenzubringen, gehen wir die Zeitenwende mit denselben Beamten an, die seit Jahrzehnten in ihren Abteilungen und Referaten sitzen.

Order the factory, not the device

Both the federal government and industry must completely overhaul their approach to arms procurement, Schularick said. It is not enough to spend money and refill Bundeswehr stockpiles; from the outset, economic processes must be designed so that weapons systems can be quickly reproduced in sufficient quantities if needed. Instead of ordering highly complex, custom-made tanks in small batches or 200 anti-aircraft missiles, the goal should be to build production capacity.

Wir bestellen nicht mehr das einzelne Gerät, sondern die ganze Fabrik, die dann im Ernstfall sehr rasch 2000 statt 200 Raketen pro Jahr produzieren kann.

Schularick said the approach must shift from purchasing individual devices to securing the industrial capacity that can scale output in an emergency.