EXPLAINED: How the Iran war is driving Washington and Berlin apart

Something has quietly broken between Washington and Berlin, and it may not be easily fixed.

For decades, the transatlantic relationship between the United States and Germany has weathered its share of storms: trade disputes, disagreements over defence spending, the odd diplomatic snub. But what is unfolding right now could be different. The ongoing US-Israeli military campaign against Iran has set off a chain of consequences that nobody in European capitals seems to have fully anticipated, and among the most visible casualties is the friendship between President Donald Trump and German Chancellor Friedrich Merz.

Trump threatened yesterday to review the number of American troops stationed in Germany, the beating heart of the US military presence in Europe. Germany is home to somewhere between 35,000 and 50,000 active-duty personnel. American bases in the country handle everything from aircraft maintenance to medical treatment, and they serve as staging posts for operations across the Middle East. Reducing troop numbers or downgrading bases could threaten the entire architecture of post-war European security. Military experts warn that pulling troops out would be a backdoor way of dismantling NATO without formally leaving it.

Trump's threat was a direct response to Merz publicly criticising American strategy in the Iran war. To understand why the German chancellor did that, it is important to understand just how badly things have gone wrong for him at home. When Merz took office, he chose to get close to Trump. There were White House visits, plenty of flattery and photo ops. He even opened up German bases for use in the Iran campaign without much argument.  But the closure of the Strait of Hormuz has been a major setback. It sent fuel and energy prices surging across Europe, and Germany—an economy that lives or dies by its exports—has been particularly hammered. Growth forecasts for 2026 and 2027 have been slashed. A vast borrowing initiative, talked up by Merz's government as an economic "bazooka", failed to deliver the promised stimulus, largely because the money ended up plugging a €34 billion hole in the budget rather than kick-starting anything. Structural reforms to health care, taxes and pensions have stalled almost entirely.

The political consequences for Merz have been brutal. His coalition is staring at an abysmal 15 per cent favourability rating. Meanwhile, the far-right Alternative for Germany has seized on the public's frustration and climbed to become the most popular political force in the country. Faced with that kind of pressure, Merz was forced to point fingers at America and Trump.

At a school assembly in western Germany, he said out loud what many European leaders have been complaining privately. He accused the Americans of having no exit strategy in Iran, drew uncomfortable comparisons to the two-decade misadventures in Iraq and Afghanistan and suggested Iran's negotiators had run rings around their American counterparts in Islamabad—sending US diplomats home empty-handed. The war, he said, was hurting German taxpayers and wrecking the country's economic health.

Trump responded in his customary fashion, taking to Truth Social to accuse Merz of effectively backing Iran's nuclear ambitions and mocking Germany's economic woes. “The Chancellor of Germany, Friedrich Merz, thinks it’s OK for Iran to have a Nuclear Weapon,” wrote Trump. “He doesn’t know what he’s talking about! If Iran had a Nuclear Weapon, the whole World would be held hostage. I am doing something with Iran, right now, that other Nations, or Presidents, should have done long ago. No wonder Germany is doing so poorly, both Economically, and otherwise!” 

What is striking, though, is that Merz is far from alone in this. British Prime Minister Keir Starmer, Italy's Giorgia Meloni and Spain's Pedro Sánchez have all found themselves in public rows with Washington over the conflict. Analysts have noted that standing up to Trump has actually improved the political standing of leaders like Sánchez. The recent electoral collapse of Hungary's Viktor Orbán—a staunch Trump ally—has not gone unnoticed either. The message filtering through European capitals seems to be that cosying up to this White House is a liability.

The war was launched without any meaningful consultation with European partners. Yet it is Europe that is absorbing much of the economic pain. That is an arrangement that is becoming increasingly difficult to sustain.