‘Grand Coalition’ in Germany: New Challenges – Old Responses?

German voters have been waiting for the formation of a new government for more than five months – for Germany, this is a serious exception to the rules. The peculiarity of the 2017 parliamentary elections is that none of the parties, which were potential partners in the coalition, wanted to participate in Angela Merkel’s cabinet at any cost. The stable high rating of the right populist Alternative for Germany (AfD) and the failure of negotiations on the establishment of a government with the Greens and FDP forced the CDU/CSU and the SPD to decide on the next edition of the “Grand Coalition.” In Germany, the alliance of the two main parties is perceived as a forced measure, which leads to stagnation. 

The coalition agreement signed on March 12, 2018, is the result of significant concessions from Angela Merkel: the Social Democrats managed to reflect up to 70% of their demands in the agreement; to get six ministerial portfolios, including the important post of finance minister, traditionally occupied by the representative of the elections winner, the Ministry of Foreign Affairs, Labour, Justice, Family, Environment. Despite the apparent success in the negotiations, the issue of participation in the government has practically split the base of the SPD, which fears that another participation in the coalition will lead to the loss of the “people’s party” status.

How strong and manageable can the new government be? On the one hand, the CDU and the SPD’s programmatic views coincide in many respects, the parties worked together in the previous two coalitions, they realize that new elections would not bring better results and would only benefit the AfD. On the other hand, the SPD needs to overcome the crisis. Party leaders announced the need for a hard line in the government, which implies not only criticism, but also readiness for decisive actions. The positions of Angela Merkel, who will become Germany’s chancellor for the fourth time, have been weakened: the objective fatigue from her long rule and the controversial policy towards refugees weigh in. She needs to strengthen support within her own party with a lot of dissatisfied members. However, to express a constructive no-confidence vote, a new leader is needed, for whom two-thirds of the deputies will vote. At the moment, such a leader is not available in the ranks of either the CDU/CSU or the SPD.

The migration policy and the issues of combating poverty and supporting unprotected social strata can become a stumbling block for the new government. The dilemma of the German parties is that a large part of the electorate is used to living in a social state, and is afraid to lose its advantages in favor of immigrants. However, most parties, including the CDU and the SPD are not ready for tough measures to limit immigration, which the AfD demands.

The issues of Germany’s domestic policy are closely linked to the EU future. The ability to conduct social programs is provided by Germany’s export-oriented economy, which leads to discontent and problems in other countries. Despite Italy’s recent attempts, together with France, to make Germany reform the eurozone, which should equalize this imbalance, now the likelihood of Italy’s exit from the “euro” seems quite real to experts. Structural problems in the economy, electoral victories of the right forces – all of that is the last warning for the dominant role of Germany in the EU, which should decide to reform the union with France, before “the populist riot in Rome infects the whole of Europe.” The leaders of both Germany and France must come to a compromise: Germany should review its dogma about the need for austerity policy and realize that the “open door” policy for migrants splits Europe, while France should abandon unrealistic demands to Germany. Working out a compromise solution with the Social Democrats would be easier for Angela Merkel, despite the resistance of the opposition and segments of her own party.

The creation of the “Grand Coalition” does not promise significant changes in the Russian-German relations. At the same time, relations with Russia will become more predictable and consistent. The fact that the foreign minister’s position was given to an SPD member provides a reason to hope for a pragmatic approach by the new government on such matters as economic cooperation and dialogue between civil societies. Both provisions are reflected in the coalition agreement. The new German government, together with France, plans to continue to make intensive efforts to resolve the conflict in eastern Ukraine. The cornerstone of this effort should be the observance of the cease-fire, along with withdrawal of heavy weapons and armed units from that territory. These processes must be ensured through the UN mission. The lifting of sanctions is only possible if the Minsk agreements are implemented. Meanwhile, the opposition can be expected to initiate discussions on issues related to relations with Russia.

At the same time, there is a consensus in the Bundestag on the issue of relations with the United States and the role of Germany in the international arena as a “transformative force”: “Germany and the United States should be equal partners, talking at the same level.” This implies a more active and consistent upholding of Berlin’s interests in the economic and foreign policy spheres in relations with Washington, Germany’s active role in resolving international crises, the continuation of the Bundeswehr reform, and the strengthening of the defense and foreign policy component of the EU.

Views expressed are of individual Members and Contributors, rather than the Club's, unless explicitly stated otherwise.