June 4, 2019 / 11:43 AM / 16 days ago

SCENARIOS-No easy options for Germany as SPD crisis shakes coalition

BERLIN, June 4 (Reuters) - The abrupt resignation of the leader of Germany’s Social Democrats (SPD) after disastrous European and regional elections has thrown the future of the ‘grand coalition’ with Chancellor Angela Merkel’s conservatives into doubt.

The government looks set to limp on until elections in three former Communist eastern states in September and October. But if the SPD and Merkel’s conservative Christian Democrats (CDU) do badly, the risk of a government collapse would increase sharply.

The SPD, led by an interim triumvirate for the next few months, will later this year pick a new leader and review its role in the coalition. To reinvent itself in opposition and win back defectors from the resurgent Greens, the SPD may, under a new leader, ditch its marriage with Merkel.

Here are the main scenarios for Germany if the coalition between the conservative bloc and SPD collapses:

NEW ELECTION

The option most analysts are talking about, a snap election before the next scheduled one in 2021, poses enormous risks for the conservatives and SPD. Merkel has said she will not stand for a fifth term as chancellor.

The conservative bloc of the CDU and its Bavarian CSU sister party is polling at 26%-29%, below their 2017 election result. Merkel’s heir apparent Annegret Kramp-Karrenbauer has failed to boost the CDU’s ratings since taking over as its leader in December.

The SPD faces decimation, at 12%-17% in polls, paying the price for sharing power as Merkel’s junior partners for six years and 10 of the last 14. A reluctant SPD was effectively forced by the president to re-enter government with Merkel after the 2017 election, in which the party slumped to its lowest level since democracy returned after World War Two.

The Greens, which a weekend poll put as the strongest party on 27%, could be the big winners. They overtook the SPD in May’s European elections although they may fare less well in a federal vote.

The far-right Alternative for Germany (AfD), off highs reached at the peak of the 2015-2016 migrant crisis, is polling at around 12%-13%, roughly stable with its 2017 election level.

MERKEL STAYS ON IN MINORITY GOVERNMENT

Germans’ fear of instability, a legacy of the fragmentation in the years that preceded the rise of Hitler’s Nazi party, makes this an unpopular option and Merkel, known for her caution, said after the 2017 vote that she does not favour it.

However, it could be a way of keeping a government in place until the 2021 election and Merkel could probably get support for individual policies from the SPD, Greens or pro-business FDP.

ALTERNATIVE COALITIONS

To avoid the uncertainty caused by a new election, President Frank-Walter Steinmeier may encourage the parties to forge a different coalition that would keep Merkel in power until 2021.

- CONSERVATIVES AND GREENS

Public opinion points to this as a feasible option but it would be short of a majority in the Bundestag lower house as the Greens won only 8.9% of the vote in the last election. This would make policymaking difficult even if the parties could agree on a more environmentalist and pro-European agenda.

The Greens have made clear they prefer new elections which, they think, would deal them a stronger hand.

- CONSERVATIVES, FREE DEMOCRATS (FDP), GREENS

This three-way tie up, known as “Jamaica” for its party colours matching that country’s black, yellow and green flag, seems unlikely after the breakdown of coalition talks in 2017. Gaping policy differences remain between the pro-business FDP and Greens. However, this alliance would command a majority in the Bundestag so cannot be ruled out.

- SPD, LEFT, GREENS

The Left, a successor to East Germany’s former ruling communists which also draws disillusioned SPD voters from western Germany, has never been included in a national coalition but could be hypothetical partners in a centre-left government that would exclude Merkel.

This seems highly unlikely as the SPD would likely want to rebuild in opposition if it quits the grand coalition. The Greens would probably be in the driving seat and would have to accommodate a radical left agenda from the Left, such as raising the top tax rate. Probably more likely as a longer-term option. (Reporting by Madeline Chambers)

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