On the face of things, today’s announcement that Germany’s two leading mainstream parties have agreed on conditions for a grand coalition comes as a relief. The country has been waiting six long months for a workable government to materialize, and now it finally has one. Supporters of business as usual will be thrilled. Angela Merkel will continue to be chancellor, and she will go right on running things in the same low-key, low-expectation style her people have come to expect.

On closer inspection, though, matters look rather different. Merkel emerges from the latest coalition negotiations as a dramatically diminished figure. She has been forced to pay an extremely high price to her negotiating partners in the center-left Social Democratic Party (SPD), and the rank-and-file among her own Christian Democrats (CDU) are unlikely to forget it anytime soon. (There’s also the problem that the 460,000 Social Democrats have yet to vote on the coalition agreement, and there’s a serious chance they won’t approve it.) Gone are the days when Merkel could shape the German political landscape as she wanted. Even if she retains her seat as chancellor, the end of her era is already in sight.

The soggy compromise represented by Wednesday’s coalition agreement reflects a changing and demoralized electorate. Merkel’s own party won 33 percent of the vote in September’s general election — an 8.5-percent drop compared to 2013 — while the Social Democrats only mustered 20 percent. (It was the worst showing for the two big parties since World War II.) The beneficiary of voter disillusionment, however, was clear: the far-right Alternative for Germany (AfD), which emerged from the election as the third-strongest party. Its 12.6 percent of the vote was enough to earn it a place in parliament, and it has gained chairmanships on three committees.

The rise of the AfD owes much to Merkel’s overgenerous response to the 2015 refugee crisis, when 1.1 million immigrants poured into Germany over the course of a single year. Will its new government be capable of formulating a coherent and realistic immigration policy that can undermine the far right’s appeal? If the current coalition agreement is anything to go by, the answer is no. It apparently caps the number of immigrants who may enter the country each year at 220,000 — an amount hardly likely to reassure German voters who are concerned about the effects of mass immigration.

This is only one of several areas in which Merkel’s weakened position forced her to cede ground to the Social Democrats, who gained control of the crucial finance, foreign, and labor ministries. (The editor of one leading newspaper has archly called it “the first SPD government led by a CDU chancellor.”) The Christian Democrats managed to retain the defense ministry, whose incumbent, Ursula von der Leyen, is a possible successor to Merkel.

So, yes, Merkel will be the chancellor once again. But her party’s disastrous performance in September’s election and the lopsided terms of the coalition agreement have stirred up discontent within the CDU’s ranks, and that unhappiness is likely to make itself felt as soon as she begins her new term. Meanwhile, many Social Democrats are worried the grand coalition will end up damaging their own party most of all (just as it has in the past, when Merkel appropriated many of the Social Democrats’ most popular ideas).

And what about the future? Younger Germans, who have had Merkel around for a good portion of their lives, clearly want to see something different. In recent surveys of Germans between the ages of 12 and 25, a whopping 69 percent of them agreed with the sentence “politicians don’t care what I think” — a sign of deep alienation from the existing system of political parties. (It might have something to do with the fact that the age of Germany’s average political party member is 60.)

As the AfD challenge shows, never has Germany been more desperately in need of new political ideas. The notion that most Germans are averse to change, and simply want to coast along in a rerun of previous coalitions, is belied by the polls. One recent survey showed that only 51 percent of voters approve of a fourth term for Merkel, down from 70 percent six months earlier. Forty-six percent oppose a fourth term. If current trends persist, Merkel’s chancellorship is likely to taper into a long, drawn-out whimper of disillusionment.

One thing is clear: Though this new grand coalition professes to offer voters “a fresh start,” few believe it will be in a position to deliver. The most likely scenario is simply a fresh round of muddling through. As one commentator noted, the problems for Germany’s two leading parties are just beginning. The country deserves better.