Germany is the most important country in the EU (with which we do almost half of our trade) and was the second largest destination country for UK exports in 2020. After Chancellor Merkel, what direction will Germany now take, and what lessons from the election results of 26 September might there be for politics in the UK, now that we have left the EU?
Merkel’s absence from the world stage will surely be felt, as her focus on “co-operation rather than confrontation”, as she once put it, in an era of populist demagogues, has led to high levels of trust in her on both sides of the Atlantic. At home, however, some would argue, while she has steered Germany through a series of crises related to the economy, migration and the pandemic, her legacy may be one of complacency, as she has failed to prepare the country for many of the challenges which lie ahead. These include climate change, decaying infrastructure, the pension system, lack of digitalisation in the economy, skills shortages and so on.
And abroad, despite being the most influential player within the EU, some feel she has adopted an overly cautious approach to challenges to the EU’s legal order from Hungary and Poland. On European economic integration, only recently, in response to the pandemic, did she join forces with France’s President Macron and other EU leaders, to agree a post-pandemic recovery package providing E800bn in jointly guaranteed debt, including grants to indebted countries in southern Europe, overseen by the European Commission.
In foreign policy, during the Merkel era, Germany was reluctant to face up to the potential threats posed by both an assertive Russia and, economically and strategically, by China, preferring to focus on the interests of German exporters. There is now broad political agreement that Germany’s defence and security policy will need to be recalibrated by the new government on a number of fronts.
The gap left by Merkel’s departure is reflected in the outcome of the election. Her centre-right alliance, the CDU/CSU, had a historically poor result, receiving 24.1 per cent of the votes cast. The Social Democrat SPD increased its share of the vote by 5.2 per cent to 25.7 per cent. The Greens came third, with 14.8 per cent. The pro-business liberals, the Free Democrats (FDP), polled 11.5 per cent. Alternative for Germany (AfD), a far-right party, came in at 10.3 per cent, while Die Linke, the Left, got just under five per cent; both having their strongest showings in the east of Germany. It will take a coalition, probably of three parties, to form a government.
The West German constitution after the second world war – under the influence of the Allies (France, the UK and the US) – established a mixed electoral system, based on proportionality. Half of the Bundestag’s members are elected to represent single-seat constituencies and half though proportional representation. Since 1966 all federal governments have been composed of at least two parties.
So, the Germans are used to forming coalitions and what might seem an alarmingly long process of negotiation is seen as normal for them. Meanwhile, Merkel’s existing administration will remain in post until a new government is formed, probably around the turn of the year.
At present the betting is on a so-called “traffic light” Coalition, combining the red-green-yellow colours of the SPD, the Greens and the business-leaning Liberal FDP. There is a strong incentive for the two smaller parties to find common ground and, in a smart move, they began talks with each other before talking to the larger centre parties. In any coalition government of which they are a part, they will have significant power as together they are potential king-makers. For example, the FDP’s leader Christian Lindner is thought to have his eye on the Finance Ministry.
It is notable that the Green’s first ever candidate for Chancellor, Annalena Baerbock, began her campaign with the offer of a pact between industry and the Greens, in order to deliver the necessary net-zero transition. However, her campaign failed to deliver on early high expectations and many Green supporters now feel the co-leader Robert Habeck, an experienced negotiator with the other parties, should be Vice-chancellor in a new coalition government.
There will undoubtedly be challenges for the Greens to agree with the low-tax advocating FDP on how to finance investments in net zero and climate protection. Nevertheless, the FDP are now claiming to support such goals and ideas for how to create “ring-fenced” finance measures are starting to emerge. The Greens and the FDP are also aligned on some “progressive” social policy issues – such as modernization of education policy and digitalization; lowering the voting age to 16; legalising cannabis and naturalising migrants.
Another area where these two smaller parties broadly agree is on foreign relations. Both the Greens (who wish to defend human rights) and the FDP (who oppose unfair competition from China) support a more critical approach to China and Russia.
Perhaps the most persuasive reason why a “traffic light” coalition might succeed, is the personality of SPD leader Olaf Scholz himself. He currently acts as both finance minister and vice-chancellor – jobs he has held since 2018 in the Grand Coalition with Merkel’s CDU. His caution and confidence have successfully portrayed him as the natural successor to Merkel as Chancellor. He is already well-known to President Macron, who himself faces re-election next spring. Following the Aukus debacle for France, the French President will be keen to enlist the next Chancellor in support of greater autonomy for the EU in matters such as defence and security.
So what, if any, are the potential lessons from the German elections for UK politics?
- Could the come-back of the German SPD, a party of the left, from deep decline, to potentially lead a new government, give hope to the UK’s Labour Party?
- Perhaps the UK centre-left could take note that a “progressive alliance” between parties which make the effort to find common ground, could pay dividends in terms of gaining political power?
- Could the success of the Greens and the determination to prioritise “green” policies influence both Labour and the Liberals to headline such credentials in future campaigns?
- The proportional element in Germany’s post-war electoral system has undoubtedly helped to achieve its objective of limiting the influence of populist parties and this, of course, remains absent from the Westminster parliament.
So far as the impact on “global Britain”, is concerned, following Brexit, the UK has ceased to be one of Germany’s top 10 trading partners. If the UK had not left the EU, the departure of Merkel could have provided an opportunity for our government to step up to take a more prominent role in influencing EU trade, foreign, defence and security policies, as well as providing a conduit for enhanced EU/US defence and security collaboration through NATO, thereby strengthening the Western Alliance.
As it is, it was left to former Conservative Prime Minister Theresa May to question the current Prime Minister on 17 September about the implications of the Aukus deal (with Australia and the US, in which the UK was the “third wheel”) and the possibility of our being dragged into a war with China over Taiwan. As she well knows, the UK has neither the economic nor the military capability to even remotely contemplate any such engagement and will continue to need a functioning relationship with its most important EU neighbours and trading partners, including Germany.
“Co-operation, not confrontation” might be a lesson from the Merkel era for the UK’s future relationship with the EU.