What the German elections mean for Europe by Sophia Besch
The outcome of Germany’s general election matters for the rest of Europe. Germany’s major political parties are all various shades of pro-European. But they have different views about how to reform the eurozone, and on what kind of foreign policy Germany should pursue. Six parties are set to enter the Bundestag in September: the conservative Christian Democrats (CDU/CSU), the Social Democrat Party (SPD), the liberal Free Democrats (FDP), the Green Party, the far-left party Die Linke and the far-right Alternative for Germany (AfD). None will be able to govern on their own. Chancellor Angela Merkel has ruled out CDU/CSU coalition government with Die Linke and the AfD, but has otherwise kept her options open. Voters prefer a ‘grand coalition’ with the SPD, closely followed by a CDU/CSU-FDP government. But the Green party, standing at a similar level in the polls as the FDP, is also keen to enter power. Based on current surveys, SPD candidate Martin Schulz could become chancellor only if his party went into coalition with the Greens and Die Linke. What would these differing coalition options mean for the prospect of eurozone reform? French President Emmanuel Macron wants a common eurozone budget, a European finance minister and a eurozone parliament, and thinks Germany and the EU should boost investment. The CDU/CSU, however, is highly sceptical of France’s plans. It places a premium on adherence to the eurozone’s fiscal rules and opposes proposals that could usher in debt mutualisation. But Merkel knows that
Germany and France need to work together closely to provide the leadership Europe needs. Her next coalition partner will determine whether she has enough leeway to compromise with the French. If the SPD can swallow its reservations about being the junior partner for another four years, a renewed grand coalition could open the way for some flexibility by the Germans in Merkel’s final term: both Schulz and current foreign minister, Sigmar Gabriel, support much of Macron’s approach. If the CDU/CSU enters into government with the Greens, Merkel might also be able to keep the hardliners in her party at bay by claiming her hands are tied. The Greens have embraced all of Macron’s reform proposals; they want an end to austerity and a European ‘investment offensive’. But they are unlikely to get more than 10 per cent of the vote and might find it difficult to hold their ground in a coalition government. Should the September election lead to a coalition between the CDU/CSU and the FDP, prospects for eurozone reform would be poor. The FDP sees itself as the economic and regulatory conscience of Germany and would push the CDU/CSU to double down on its calls for fiscal discipline. The