It’s Monday, the German elections are over, and we here in Berlin are still trying to recover from the excitement. For your Monday-morning consumption, we’re providing you with the most important facts and analysis for what you want and need to know. Enjoy and ping us for more!
WHAT ABOUT THE RESULTS?:
After 16 years of Angela Merkel and CDU/CSU, we have a new election winner: Olaf Scholz and the SPD become the strongest power with a slight but clear lead in front of the CDU/CSU. The CDU/CSU and Armin Laschet reached their historic low and the worst result in a Bundestagswahl EVER. The Greens come in third and reach their best result, but fall short of their goal of leading the next German government. Furthermore, we have a slightly increasing liberal FDP coming in fourth and a slightly decreasing AfD coming in fifth. As it stands, the Lefts fail the 5% hurdle, however, they won three electoral districts directly and can therefore also enter the new Bundestag. Lastly, the SSW, a Danish minority party from Northern Germany for the first time reaches one (but only one) seat in the new legislative period of the German Bundestag. So far, so good.
5-POINT COFFEE BREAK ANALYSIS:
- Victory for the center: Germany’s political center was strengthened in this election while the far left and far right achieved only poor results.
- (Likely) Three parties instead of two: Germany will likely have a three-party coalition for the first time since the 1950s, as the only two-party option is the previous “Grand Coalition” between CDU/CSU and SPD. However, both parties are averse to continuing this cooperation.
- Chancellor of compromise: The closeness of the projected results means the next Chancellor, regardless of which party, will be ruling through permanent compromise with the coalition partners. This means the Chancellor will be less of a strong leader, putting through his/her points, but rather acting as a moderator between coalition partners.
- Winner might not take all: The SPD might be the winner of last night. However, they only lead with a 1.6% margin ahead of the CDU/CSU, which means the question of who will lead the next government is still open. We expect complicated and possibly long-lasting coalition negotiations, even though Scholz and Laschet already signaled that they are willing to close the negotiations until Christmas (this year, hopefully).
- Kingmakers likely to steer policy impulses: Based on the current results, the FDP and Greens are projected to have special power in negotiations for building the next coalition. This means there will be heavy focus on topics like climate change, digitization, boosting innovation and reducing bureaucracy. Also, all parties likely to be involved in the new government have a positive attitude towards the EU, suggesting a pro-European approach, pro-NATO stance, and a clear support for international trade.
WHAT’S HAPPENING NOW?:
Now, we’ll take a look at the most realistic coalition options and explain what would need to happen to make them work. Quick note: In Germany, as you’ll see above in the graphics, each party is associated with a color. So, when these parties get together for a coalition, we name the coalition after the combination of colors. That’s why you’ll see talk of “Jamaica” (black-yellow-green) or “traffic lights” (red-yellow-green). Beyond this, we also want to give you an overview of what to await in the coming days and weeks:
- Talks between Greens and FDP: There is probably no realistic coalition without the liberal FDP and the Greens. After the last elections in 2017, a coalition between these two parties and the CDU/CSU failed because FDP and Greens could not reach a consensus on various topics. Therefore, to avoid history repeating itself, both parties have expressed a will to get together before they enter negotiations with the CDU/CSU and the SPD. In these talks, the two parties will likely map out in which policy areas they could reach a compromise, as there are still some key conflicting points (namely on how to improve climate policy and taxation). The FDP clearly prefers a CDU/CSU-led coalition (called “Jamaica coalition”) and rumors in Berlin are that FDP leader Christian Lindner has the task of making this option tasty for the Greens.
- Jamaica coalition (CDU/CSU, Greens, FDP): We could be facing a situation in which the strongest party doesn’t become part of the government. This would be the case in a Jamaica coalition. Allegedly, Armin Laschet (CDU/CSU) and Christian Lindner (FDP) see eye-to-eye about major points for a future government. Therefore, their job is now to get the Greens on board which will demand various efforts especially by the FDP. A Jamaica coalition is already in place in the Land of Schleswig-Holstein, where Green party leader Robert Habeck was also a State Minister. We know that Lindner already called Habeck on Sunday afternoon. Problem with this option: as there is a possibility for the Greens to cooperate with Scholz instead of Laschet, choosing to move away from the SPD would be highly unpopular with the Green party base. Should this decision come down to a vote among Green party members, the Jamaica Coalition is anything but sure.
- Traffic light coalition (SPD, Greens, FDP): The option that would make election winner Scholz (SPD) Chancellor is a traffic light coalition. SPD and Greens would have loved to form a coalition together, but the FDP is not a fan given their many overlaps with the conservative CDU/CSU. This constellation would require HUGE concessions for Lindner’s party and even then, it is not sure that it will happen. As the election results don’t suffice for a center-left wing coalition of SPD, Greens and Lefts, the SPD lacks leverage to force Lindner and the FDP to the table for building a traffic light coalition.
- CDU/CSU: Another important development in the next days will be the internal quarrels in the CDU/CSU. Even though they could still lead a government with the Jamaica option, their historically worst result is certainly not pleasing many party members. The million-dollar question is whether their candidate, Armin Laschet, will survive the next weeks or get sacked by party members already unhappy with him. Murmur from inside the party seems to indicate that some members would rather have the party be in the opposition (meaning firing Laschet) than lead a potentially weak conservative-led government. That being said, since the Jamaica option is still very much in the cards, party members are unlikely to attempt the coup. We cannot make any serious predictions about how this will evolve but we find it worth mentioning. Laschet’s political survival is not a given at this moment.