Skip to main content

Germany's Coalition-forming Process: Can Merkel Change Politics Forever?

Axel Wallrabenstein
, Thu, 11/09/2017

By Axel Wallrabenstein, Chairman, MSL Germany

After federal elections on September 24, a new era is dawning in Germany. Not because the leadership might change – it will not, at least not at the very top. But, with seven parties in parliament, the voters have challenged politicians to seek new alliances.

In the post-war era, the two sides of the aisle have dominated German politics: Social Democrats on the left, and the Conservatives on the right. For decades, the Liberals were pivotal in forming a majority. In the 1980s, the Green party came into play. Still, most of the time there was either a left majority or a conservative one. Merkel’s tenure, however, marked the beginning of a new era where majorities become more volatile, and forming a government has never been harder. Or, has it?

Although weakened by losses of 8.5 percent, Merkel won a clear mandate to form a government coalition. The Social Democrats, her partners for four years, were quick to announce their unwillingness to participate in any government coalition after their worst post-war results. With the right-wing AfD party entering parliament, further narrowing down possible majorities, this left Merkel only one path to form a government: her CDU would need to partner with its Bavarian sister party CSU, the Liberals, and the Green party.

German Federal Elections 2017

Difficult times ahead

It is by no means certain whether they will succeed. While Merkel’s Conservatives and the Liberals have worked together before, the Green party is new to the equation. Between the conservative Bavarian CSU, Merkel’s more moderate CDU, the pro-business Liberals and the Green party, there is room for conflict. If German politics has arch rivals, it certainly are the Liberals and Greens whose views on the role of the individual diverge. Certainly some in the CSU would rather push for Bavaria to secede from Germany than work together with the Greens on migration policy – one of the issues that dominated the campaigns. And, while the Greens and the Liberals presented ideas for expensive programs and tax cuts, Merkel wants to keep a balanced budget.

Merkel and her counterparts in the other parties face strenuous times and weeks ahead. Coalition negotiations have never been so complex before, divides have never been so deep. So it only makes sense that this time, that the negotiations include several milestones along the way to avoid failure at the end.

Usually, as a first step, all parties come together for “exploratory talks” to evaluate whether there is enough common ground in key policy areas before they enter into the formal coalition negotiations. This time, the parties held bilateral meetings before they even started exploratory talks. The exploratory phase will already take weeks, and for the first time, it will end with a formal paper outlining the main objectives of the coalition in twelve pre-defined legislative areas.

Government formation may take until after Christmas

The paper will be subject to inner-party discussions. Meanwhile, formal talks will not start before the middle to end of November – almost eight weeks after the elections. They will take three to four weeks and probably won’t end until mid-December – just in time to seek approval of the parties’ decision-making bodies before Christmas. CDU and CSU will most likely hold a party conference to have the final coalition treaty approved. The Green party, however, will hold a vote of all party members. Leveraging their party base might help them in pushing for their key issues in the negotiations. If they don’t succeed in bringing their party on board, this strategy could also backfire and put the whole project at risk. Also, failure to reach agreement in one of the many disputed issues might delay the whole process, and we even might not have an agreement until after the Christmas break.

In the attempt to form this four-party coalition with unprecedented differences, Merkel and her new partners have entered unchartered territories. While the timeline might change and agreement might be difficult, no one doubts that in the end, it will be reached -- at least for the moment.

And if Merkel succeeds in forming a government by overcoming the arithmetic of previous decades, she will have changed forever how German politics work.

Additional Blog

SxSW 2017: Fintech and the Future

read more

Subscribe to MSL's Blog

* indicates required

Do you want to get in touch?