Germany’s elections

A new buzz for Germany

Angela Merkel's CDU and the liberal FDP will rule Germany together

THE election campaign was soporific but the results are startling. The “grand coalition” of Germany’s two biggest parties, the Christian Democratic Union (CDU) and the left-leaning Social Democratic Party (SPD), has been voted out of office. Angela Merkel remains as chancellor but her new governing partner will be the liberal Free Democratic Party (FDP), which scored its best result ever on Sunday September 27th. The change of partners portends a sharp shift in the priorities and tone of Germany’s government.

The new “black-yellow” government is a reincarnation of a coalition that governed Germany from 1983 to 1998 but with the FDP now in a considerably stronger position. The FDP is a pro-business party that champions reforms of social security, civil liberties, and above all lower and simpler taxes. It strongly opposes many of the policies that Ms Merkel adopted during the grand coalition to placate her SPD partners, such as minimum wages and give-aways to pensioners. The course of government over the next four years will largely depend on how tensions relating to such polices are resolved.

Ms Merkel has already ruled out implementing some of the FDP’s more radical ideas, such as loosening regulations that protect workers from dismissal. Tax reform of some sort will have to occur. The FDP’s leader, Guido Westerwelle, says he will sign no coalition agreement without it. The CDU’s Bavarian sister party, the Christian Social Union (CSU), has been pushing for a 100-day package of tax-relief measures. But with a record federal budget deficit expected for next year and a commitment to reduce structural deficits nearly to zero by 2016, it is hard to see how the government can offer generous tax cuts. The outgoing finance minister, Peer Steinbrück, said they had “no chance”. His successor will face similar constraints but will find it hard to speak so bluntly.

The FDP and the CDU may clash over civil liberties. The FDP objected to many of the anti-terror policies backed by the conservative interior minister, Wolfgang Schäuble, most recently a proposal to expand the powers of the domestic intelligence agency. The two parties are closer on the vexed issue of nuclear power. They may well agree to allow nuclear plants to continue operating beyond 2022, the deadline set by an earlier SPD-Green government. Mr Westerwelle is expected to become foreign minister and vice-chancellor. He is better known for his views on taxes than on how to handle the relationship with Russia, what to do about Iran or how deeply Germany should be involved in Afghanistan, but he is unlikely to break sharply with current cautious policies. In any case Ms Merkel will still call the shots.

The election brought about what may prove to be a lasting realignment in German politics. It is a blow for both the Volksparteien. The SPD with 23% of the vote scored its worst result in modern history and moves into opposition for the first time in 11 years. But the CDU’s performance was no triumph either. Despite Ms Merkel’s popularity, it won just 33.8% of the vote, its smallest share in 60 years. The CSU in Bavaria is accustomed to winning more than half the vote in the state, but in this election barely topped 40%. After four years of horse trading and compromise in the grand coalition, the identities of both the main parties had been blurred and many of their voters were disenchanted. The gainers were the three smaller opposition parties: the FDP, the Greens and the ex-communist Left Party. Voter turnout was a record low of 70.8%.

The results mark a return to more traditional politics with the two big parties in opposition to each other and a clear distinction between right and left. The SPD will now have to reinvent itself. That will mean resolving bitter internal disputes between economic reformers such as the party’s candidate, Frank-Walter Steinmeier, and the party’s powerful left wing. The SPD had ruled out governing with the Left Party after this election. The two parties will spend much of the next four years groping towards a relationship to make a left-leaning coalition possible in 2013.