Bursting the Bubble

Germany Votes, Europe Waits

27 September 2013 | by

As most people armed with a connection to the internet, a radio, newspaper or TV may be aware, the German electorate has just elected a new Bundestag (Parliament) and coalition negotiations are currently underway. In every other election in Germany, maybe except for the elections which followed German Reunification (this will be discussed in a moment), these elections happened in a manner lacking – in keeping with the tradition of Federal Elections – the passion and heatedness which is often observed in France, the UK or the US. Indeed, in Germany itself, the issues, format and tone of the elections have not felt that dissimilar from those in previous years. The difference this time is that Germans were well aware that Europe and the wider world were watching events unfold – with an anticipation never before seen.

That, put simply, is the result of Germany’s role in developing a response to the European Sovereign Debt Crisis. Elections held in 1990 saw the first pan-German elections since 1933 and also drew the attention of international observers across the globe. Both elections, those in 1990 and those on Sunday (21 Sept. 2013) have addressed the question of what Germany’s role in Europe, and the world, will be. Additionally, on both occasions Germany, known for its coalition based multi-party system of parliamentary government (established in West Germany following the Second World War), gave a strong mandate to the incumbent Chancellor and party – in both cases the conservative CDU/CSU Union. Given that many (both in and outside Germany) see reckless governments and the unpredictable market as being behind the current economic crisis in Europe, the decision to seek continuity and certainty in government is not so surprising

Having established the choice of the electorate to throw their weight behind Chancellor Angela Merkel (who consistently out-polls her own CDU party, making this, beyond doubt, a personal victory for Merkel and not the Christian Democrats) Europe now has to wait to see the outcome of coalition discussions. The CDU/CSU’s former coalition partner, the pro-business liberal FDP did not achieve enough votes to enter the Bundestag. Furthermore, the election’s “wild card”, (again a rarity in German politics) the anti-Euro Alternative for Germany (AfD), also failed to enter the teutonic legislature. The radical Die Linke, shunned by many in the Bundestag for their links with former Communist administration in East Germany, has been left as the largest opposition party in Europe’s largest economy.

A coalition with the Social Democrats (SPD), the so-called Grand Coalition, which last governed from 2005 to 2007, is a serious possibility. The SPD has used less harsh language during the crisis in the Eurozone and is likely to be more sympathetic to Greece and other crisis-stricken southern European countries. The SPD is also likely to prove an obstacle for British Premier David Cameron, as it is opposed to his attempts to re-negotiate the UK’s relationship with the EU. Finally, the Social Democrats have a long-standing relationship with the French Socialist Party that could help to thaw frosty relations between conservative-led Berlin and socialist-Paris. A so-called “Black-Green” coalition between the CUD/CSU and the Green Party has also been suggested. Although there is no president at national level for such an alliance, in the Saarland and Hamburg the two have formed regional governments. The economically liberal Greens might be willing to support CDU/CSU economic policy in return for securing a transition away from nuclear energy. However, the deeply-conservative Bavarian CSU (sister party of the CDU) has spoken out against an alliance with the Greens.

Whichever coalition government is in Germany, it is set to continue a tradition of stability in the German political system. Yet, it will remain to be seen if Europe and the EU will be able to overcome the European Debt Crisis, up to par with how the fall of the Berlin Wall was dealt with.

What do you think?