Sunday Essay 25 | 2026
Germany, Japan and the Growing Realisation That Prosperity Alone Cannot Guarantee Stability
SUNDAY ESSAYS
6/14/2026
One of the most revealing geopolitical stories of the past week was not a military confrontation, a diplomatic crisis or a dramatic election result. Instead, it emerged from a quieter development involving two countries that have long been associated with economic success rather than strategic competition. Eighty years after the end of the Second World War, Germany and Japan continue expanding military capabilities and reassessing their security positions in response to an increasingly uncertain international environment. On the surface, this appears to be a defence story. Yet its significance extends far beyond military spending. What makes the development noteworthy is not simply that Germany and Japan are investing more heavily in security, but that they are doing so despite being among the greatest beneficiaries of the international order that emerged after the Cold War.
That observation may help explain a surprising number of this week’s headlines.
For much of the post-Cold War period, prosperity occupied a unique place within political thinking. Governments certainly debated security, diplomacy and strategic competition, but economic growth often served as the central organising principle around which many other policies revolved. Prosperity generated resources. Resources strengthened institutions. Strong institutions supported social cohesion, political legitimacy and national resilience. Economic success was not merely a policy objective. It was frequently viewed as the mechanism through which other challenges would eventually become more manageable.
This assumption did not emerge accidentally. The decades following the collapse of the Soviet Union appeared to validate it repeatedly. Global trade expanded at an unprecedented pace. Financial markets became increasingly interconnected. The European Union enlarged. China’s integration into the world economy accelerated. Supply chains stretched across continents. Technological innovation transformed communication, commerce and production. For businesses, investors and policymakers alike, the future appeared increasingly shaped by economics rather than geopolitics.
The intellectual environment of the period reflected this reality. Many political leaders entered office during an era in which major military confrontation between advanced economies appeared increasingly unlikely. Security concerns never disappeared entirely, but they often occupied a secondary position compared to economic management. Political debates focused on competitiveness, productivity, innovation and growth. Success was measured through trade volumes, investment flows and economic performance. Defence remained important, yet it rarely dominated political discussion in the way it had during previous generations.
Perhaps most importantly, many policymakers came to believe that economic integration itself could function as a stabilising force. Trade was not merely a source of prosperity. It was viewed as a mechanism for reducing conflict. The deeper countries became integrated into global markets, the thinking went, the less likely they would be to engage in disruptive geopolitical behaviour. Interdependence would increase the costs of confrontation while creating incentives for cooperation. Economic integration and political stability became increasingly linked within the strategic thinking of many advanced societies.
For a time, this worldview appeared remarkably successful. The period between the early 1990s and the late 2010s delivered extraordinary economic expansion across large parts of the world. Hundreds of millions of people were lifted out of poverty. International investment surged. Consumer markets expanded. Technological progress accelerated. While geopolitical tensions persisted, they rarely appeared capable of fundamentally disrupting the broader trajectory of globalisation.
Recent years have challenged that confidence.
Russia’s invasion of Ukraine represented one of the most significant turning points. The conflict demonstrated that economic interdependence does not necessarily prevent geopolitical confrontation. Europe spent decades deepening economic relationships, building institutions and encouraging integration. Yet war returned to the continent regardless. The lesson extended far beyond Eastern Europe. Governments increasingly recognised that economic relationships alone could not guarantee security. Industrial capacity, defence production, logistics and military readiness suddenly returned to the centre of policy discussions.
This week’s developments reinforce that reality. Ukrainian strikes against targets deep inside Russian territory demonstrate how warfare continues evolving technologically while remaining fundamentally geopolitical. The conflict is not simply a military struggle. It is a reminder that geography, industrial capacity and strategic competition continue shaping international affairs in ways many policymakers once believed would become less important over time.
Germany’s response is particularly significant because of what Germany represents. Few countries benefited more from the assumptions underpinning the post-Cold War order. The country’s influence rested heavily upon industrial strength, export competitiveness and integration into European and global markets. Military power played a comparatively modest role in Germany’s national identity. Today, however, Berlin increasingly treats defence capabilities as an essential component of national resilience rather than a secondary policy concern. Economic success remains vital, but it is no longer viewed as sufficient by itself.
Japan’s evolution follows a similar trajectory. For decades, Tokyo prioritised economic development, technological innovation and commercial integration. Yet the strategic environment surrounding Japan has changed dramatically. China’s growing military capabilities, tensions surrounding Taiwan and uncertainty regarding the future balance of power in Asia have encouraged policymakers to reconsider long-standing assumptions. Like Germany, Japan is not abandoning the foundations of its success. Instead, it is recognising that economic strength must increasingly be accompanied by strategic preparedness.
What makes these developments particularly interesting is that they are occurring within countries that have largely succeeded. Germany and Japan are not reacting to economic failure. They are responding despite economic success. Their behaviour suggests that prosperity alone no longer provides the level of reassurance it once did.
This is where the discussion becomes broader than defence.
For much of the post-Cold War era, advanced economies benefited from what was often described as a peace dividend. Governments could devote fewer resources to military competition and more resources to domestic priorities because the likelihood of large-scale interstate conflict appeared relatively low. Defence spending declined across much of Europe. Economic efficiency became a dominant objective. Global supply chains expanded because security risks appeared manageable. Prosperity and stability reinforced one another.
Today, many of those assumptions are being reconsidered simultaneously.
Governments face rising defence costs at the same time that populations are ageing. Strategic competition is intensifying while public finances remain under pressure. Investments in military capabilities, technological sovereignty, infrastructure resilience and industrial policy increasingly compete with spending priorities that would previously have dominated political debate. Policymakers are discovering that prosperity does not eliminate difficult choices. In many cases, it merely changes their nature.
A similar shift is visible in Asia. Taiwan’s significance extends far beyond traditional security concerns. The island sits at the centre of global semiconductor production and therefore occupies a position of enormous importance within the modern economy. Advanced manufacturing, artificial intelligence, defence systems and consumer technology all depend upon supply chains connected to Taiwan. Governments increasingly recognise that economic prosperity itself depends upon strategic systems vulnerable to geopolitical disruption. The distinction between economics and security is becoming increasingly difficult to maintain.
China’s engagement with North Korea reinforces this trend. Strategic competition increasingly shapes decisions surrounding technology, investment, supply chains and industrial development. Economic policy is becoming geopolitical policy in ways that would have seemed less obvious twenty years ago. Governments are no longer evaluating economic relationships solely according to efficiency or profitability. They are increasingly assessing them according to resilience, exposure and strategic importance.
Canada’s recent calls for deeper cooperation with Europe should be understood within this broader context. Trade remains important, yet discussions increasingly involve questions of alignment, resilience and long-term strategic positioning. Economic relationships are no longer viewed solely through the lens of growth. They are increasingly treated as components of wider geopolitical frameworks designed to navigate an increasingly competitive international environment.
The same logic appears within domestic politics.
Switzerland’s debate regarding whether to cap its population at ten million reflects concerns extending far beyond demographics. Across many advanced economies, political discussions increasingly revolve around questions of capacity. Housing, infrastructure, public services and social cohesion are becoming central political issues. The debate is not necessarily about opposing growth. It is about determining how much growth institutions can absorb while maintaining public confidence and quality of life.
Migration debates across Europe reveal similar dynamics. Discussions surrounding immigration increasingly involve questions of governance, integration and institutional trust. Economic arguments remain important, but they no longer dominate the conversation in the way they once did. Citizens increasingly ask whether governments possess the capacity to manage rapid demographic and social change effectively. Economic growth remains valuable, yet many voters appear unconvinced that growth alone resolves concerns surrounding identity, community and social cohesion.
The unrest witnessed in Northern Ireland this week should be viewed through this broader lens. Although local circumstances remain unique, the underlying lesson is relevant across much of the developed world. Prosperity does not automatically eliminate political tensions. Economic success does not guarantee social cohesion. Governments increasingly find themselves addressing challenges that cannot be resolved solely through growth.
Even Pope Leo’s comments regarding migration during his visit to Spain reflected the complexity of these debates. Discussions concerning migration increasingly involve moral, political, economic and social dimensions simultaneously. The challenge facing governments is no longer simply how to generate prosperity. It is how to balance prosperity with cohesion, capacity and public trust.
Taken individually, these stories appear unrelated. Germany’s military expansion, Taiwan’s strategic importance, Canada’s search for deeper partnerships, Switzerland’s population debate and migration discussions across Europe seem to concern very different issues. Yet collectively they reveal a common shift in thinking.
For decades, many advanced societies operated according to the assumption that prosperity would ultimately provide answers to most strategic questions. Economic success would strengthen institutions. Strong institutions would create stability. Stability would reinforce prosperity. The cycle appeared self-sustaining.
Increasingly, governments appear less convinced.
Prosperity remains essential. No serious government is abandoning economic growth as a priority. Yet many policymakers now treat prosperity as a foundation rather than a solution. Defence capability, technological leadership, demographic sustainability, institutional trust, industrial capacity and strategic influence are receiving greater attention because they are increasingly viewed as objectives that require active management in their own right.
This shift may prove more consequential than many of the individual events dominating headlines today. Geopolitical analysis often focuses on states seeking to challenge the existing international order. Russia, China and Iran attract attention because their actions create visible tensions. Yet the more revealing signal may come from countries that benefited most from the existing system.
Germany is adapting.
Japan is adapting.
Canada is adapting.
Switzerland is debating questions that would have received far less attention a generation ago.
These societies are not rejecting globalisation, nor are they abandoning prosperity. They are recognising that prosperity alone cannot answer every strategic question facing the twenty-first century.
The most important signal from this week’s headlines is therefore not that geopolitical tensions remain elevated or that political debates continue generating controversy. Those developments are familiar. The more significant story is that many of the world’s most successful societies are quietly redefining what national strength actually means.
For much of the post-Cold War era, success was often measured primarily through economic performance. Increasingly, governments appear to be measuring success through a broader combination of prosperity, resilience, security, social cohesion and strategic relevance.
The defining challenge of the next decade may therefore differ significantly from the defining challenge of the last one. For much of the post-Cold War period, the central question was how societies could become more prosperous. Today, many of the world’s most successful countries are confronting a different question entirely.
How do you preserve stability after prosperity has already been achieved?
Judging by this week’s headlines, that question is becoming increasingly difficult to ignore.
References
Rearmament, Security & Strategic Competition
• The New York Times — Germany and Japan Are Rearming Again, 80 Years After World War II
https://www.nytimes.com/2026/06/14/world/europe/germany-japan-rearmament-military.html
• Institute for the Study of War — China & Taiwan Update, June 12, 2026
https://understandingwar.org/research/china-taiwan/china-taiwan-update-june-12-2026/
• Associated Press — Ukrainian drone strike kills 1 in southern Russia and triggers fire at sea terminal
https://apnews.com/article/russia-ukraine-war-drone-attack-a2189d216731d92cbe74c873e1e6c04e
Globalisation, Alliances & Economic Resilience
• Al Jazeera — ‘A global rupture’: Carney calls for Canada-EU unity before G7 summit
• Bloomberg — US Wants to Avoid Congressional Vote on Trade Deal, Carney Says
Migration, Sovereignty & Domestic Politics
• Deutsche Welle — Swiss to vote on whether to cap population at 10 million
https://www.dw.com/en/swiss-to-vote-on-whether-to-cap-population-at-10-million/a-77492750
• The Guardian — Number of arrests after riots in Northern Ireland rises to 19
https://www.theguardian.com/uk-news/2026/jun/12/police-arrests-riots-belfast-northern-ireland
• The Guardian — All of us are migrants, says pope as he rounds off tour of Spain in Tenerife
Middle East & Geopolitical Stability
• Politico — ‘The elephant in the room’: Trump’s Iran war looms over G7
• The Conversation — Trump has backed away from renewed war with Iran – here’s why
https://theconversation.com/trump-has-backed-away-from-renewed-war-with-iran-heres-why-285026
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