Rethinking Europe

Will Merkel Fall?

If the CSU does not agree to any compromise on migration policy, Merkel’s government may fall apart.

Credit: 360b Shutterstock.com

Takeaways


  • If the CSU does not agree to any compromise on migration policy, Merkel’s government may fall apart.
  • On the domestic political scene, Merkel’s star waned a bit after the election last September. It took her six months to hobble together a coalition.
  • Expect the CDU and CSU to defuse their dispute within the next two weeks as all sides would have too much to lose from an escalating conflict.

German Chancellor Angela Merkel faces the worst crisis of her almost 13 years in office. If the Bavarian CSU does not agree to any compromise on migration policy, her current government may fall apart.

More likely, the German government will continue despite the scars and potential erosion of authority which the noisy dispute within the conservative camp may leave behind. Still, to put the risks into perspective, here are the hypothetical scenarios.

Disintegration of the conservative camp?

On substance, many in the CDU have some sympathy for the CSU view. Nonetheless, Merkel has managed to rally most of the CDU behind her. Even the conservative wing of the CDU does not want to be blackmailed by an intransigent CSU.

In the unlikely case that the CSU were to walk out of the government, the CDU would likely continue to support Merkel, allowing her to stay on as chancellor.

New elections? Unlikely

In the wake of the current turmoil, the CDU would have no interest in new elections. Neither would the SPD, which is doing badly in opinion polls anyway. Against the will of the reigning chancellor, it is almost impossible to call early federal elections in Germany.

Minority government?

If the CSU really walks out, Merkel could thus stay on as head of a minority government backed by the CDU and SPD. Together, the two parties have 353 of the 709 seats in the Bundestag, two seats short of a majority.

Merkel could seek issue-by-issue support from the centre-left Greens (67 seats) or the liberal FDP (80 seats).

New coalition including the Greens?

After a brief interlude, such a minority government could turn into a formal coalition between the CDU-SPD and either the Greens or the FDP.

As the FDP had abandoned the talks about a “Jamaica” coalition between the CDU/CSU, FDP and Greens last autumn, the Greens might be Merkel’s preferred replacement for the CSU.

The SPD would also find it easier to co-opt the Greens than the FDP as an additional partner into a CDU-SPD alliance.

New chancellor? Unlikely

On the domestic political scene, Merkel’s star waned a bit after the election last September. It took her six months to hobble together a coalition. She is widely expected to not run for a fifth term in 2021.

Despite the current turmoil, she does not seem to face a serious challenge from within her CDU at the moment, though.

Two potential successors, Annegret Kramp-Karrenbauer and the more conservative Jens Spahn, would both need a few more years to prove their mettle in high-profile Berlin politics before they could be well placed to take over.

In the highly unlikely case that Merkel were to step down, Wolfgang Schäuble — currently president of the Bundestag — might be the stopgap chancellor for a while, possibly serving out most of Merkel’s term before handing over to a successor.

Again, the most likely outcome remains that none of these “what if” scenarios will materialize. Expect the CDU and CSU to defuse their dispute within the next two weeks as all sides would have too much to lose from an escalating conflict. Still, the risks are not negligible.

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About Holger Schmieding

Holger Schmieding is chief economist at Berenberg Bank in London. [United Kingdom] Follow him @Berenberg_Econ

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