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by Matthias Schäfer, Head of Economic Policy, Konrad Adenauer Stiftung ///

High expectations accompanied the German federal elections on September 22nd 2013 not only in Brussels but elsewhere in the European Union. Did we mind that much about the federal elections held in Austria just one week later?

But just some words about the results of the German election. German voters awarded once more what is quite common. It is the economy, stupid or not, that is crucial whether moods of change fall in or not. And as the economy in Germany runs quite well compared to many other regions in the world, not only in the Eurozone, Germans decided to vote for the well know, approved and reliable.

Furthermore, the clear majority of almost 42% of the votes was given to a chancellor that personifies reliability, steadiness and trust. The Social democrats could not get a foot into the doors of the federal chancellery, as they showed up with a center-center-left candidate that had to fight for a center-left-left programme. They ended up with about 21%, but as long as the SPD does not clarify its position towards Gerhard Schröder’s Agenda 2010 reforms. The crucial part of a fragmented left in Germany is whether the SPD in favour or against those reforms. The SPD’s small 6 seat majority in the German Bundestag is of little value politically.

The Greens, one of the partners of the talked about red-red-green majority, where deeply rejected, receiving a vote of just 8%, even though the polls gave them 25% of the vote just one year ago. That result constitutes a complete disaster. The reasons for that seem quite clear: to raise taxes is not the best policy to argue for, but is definitely the worst thing you can write down in your election programme.

So the 22 September election showed that the Greens did not only lose their appeal on core issues like environment, renewable energy, which were strongly driven by the fight against nuclear power, they also found themselves confronted with a lost generation of former party leaders. Green suddenly stands for old-fashioned, conservative and patronizing, but not any more young, innovative and progressive. Who needs the Greens? We will see how that ends, but such a sift I attitudes might help towards a black-green government.

But before talking about coalitions, the third part of that red-red-green approach, Die Linke, the former communists, see themselves as the only and strongest opposition party that won, even though they lost some 3% points compared to their 2009 results. One could argue that it takes small things to please the left, in the middle of a long lasting crisis of market economy there was worse to be expected.

But as fragmented the left might be, there are also concerns about the center right. The chancellor’s bonus programme lifted CDU and CSU, its Bavarian sister party, that even got a straight majority in their home elections one week before, to a real level of a “peoples party”, that could attract, for the first time for almost 20 years, voters from all parts of the German electorate. Angela Merkel’s success with female and young voters is worth mentioning.

But as always there is a price to be paid: The liberal FDP just missed the 5%threshold and sees itself kicked out of the Bundestag for the first time.

It is also worth noting the “near success” of the Alternative für Deutschland, AfD. With its ‘Euro-skeptical’ discourse, which left open whether the crisis countries or Germany should leave the Eurozone, attracted voters from all parts of the society, not just liberals, but also former voters of Die Linke and people who had not voted before. So there is a potential for a political offer which appeals to German voters who feel that the Eurozone stabilization process and the vast sums of money funneled into unstable economies, something is going terribly wrong and against their one interest. Especially considering European elections, that has to concern the CDU with its clear perspective of safeguarding the Euro as the best thing for the German economy and German voters. But all in all, taking the liberals and the AfDs results into account, a majority of votes did go to center right, market economy oriented parties, which gives a hint as well for the coalition talks

The clear majority of German voters are in favour of a black-red, grand coalition, as they felt well governed by the last coalition of the two big from 2005 to 2009. And as difficult decisions have to be taken in the next period, you could tend to argue that only a grand coalition is able to cope with them. For example new negotiations about fiscal integration between the federal level and the state levels as well between the state levels, which have to deal with a zero debt restriction from 2019 on, are coming up. Especially since the CDU does not enjoy a majority in the Bundesrat, the chamber where the states gather together and bring into account their interests within the federal legislation process. Furthermore, the so called energy shift, away from fossil and nuclear power to renewables, has to feature difficulty decisions. New and better energy grids need to be financed; the legislation which handles the subsidies for producing and fueling renewable energy in the networks needs a complete restart. And energy prices already started to become a matter of public concern, not only in their consequence for the households but as well for the industries and the real economy, that are the backbones of German economic power in these days. Also, in European policy, you could expect German policy under black-red to stay predictable and clearly in favour of keeping direction and pace to make the EU a better place to live for everyone by fixing the currency and stabilizing the institutions. But, even though many good reasons point to a black-red option, as long as the coalition agreement is not signed, anything can happen!

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