By Paul Taylor
After the recent general election, Germany will see its first coalition government since 1957 which includes more than two parties, and the first Social Democrat (SPD) led government since 2005.
Although the SPD won the election, it only gained a meagre 25.7% vote share; a long way from its high point of 40.9% in 1998.
The SPD benefitted from the support of just over half a million Die Linke/Left party voters who wanted to prevent a Christian Democrat Union (CDU) chancellor being re-elected.
The election also saw the worst result for the conservatives since 1949, with CDU/CSU winning only 24.1% of the vote.
The weakness of the two dominant parties – the SPD and the CDU – is symptomatic of the profound social and economic problems which have faced the German working-class since the demise of the social market model following the devastating attacks of the Hartz reforms to the country’s labour market and social welfare system since 2003.
The bad result for the Left party means a Red – Red – Green coalition majority government is not possible. It also weakens the German left as a political force. It is important to monitor the debate now taking place in the Left party as it seeks to recover and move forward.
Chart 1: Bundestag election results 2021
Chart 2: Distribution of seats in the German parliament
In the ten days following the election, CDU leader Armin Laschet tried to be the chancellor of the government most favourable to capital. But the so-called ‘Jamaica’ coalition talks with the FDP and the Greens have come to nothing – so far.
A ‘traffic light’ coalition – the SPD with the FDP and the Greens – is now the most likely outcome.
Formal talks opened last Thursday between the SPD, the Greens and the FDP, with more meetings planned from Monday 11th October. But a new government is unlikely to be formed before December.
The Greens and the FDP were the first to talk. They want to increase their leverage in any coalition negotiations and avoid being overwhelmed in government by the leading party.
Their talks are secret, to avoid significant differences scuttling their shared desire to be ‘kingmakers’.
The possibility of a CDU/CSU chancellor is growing fainter. Moreover, infighting in the CDU grows by the day as potential successors to Laschet share their misgivings about the union’s election campaign.
CSU leader Markus Söder has already publicly declared his belief that the people voted for Olaf Scholz, the SPD’s candidate for chancellor, to lead the country.
Last Thursday, Laschet effectively threw in the towel by saying that he would not stand in the way of another CDU/CSU person who was more amenable to the Greens and FDP.
A left government?
The programme of the SPD is very modest.
It does not propose to reverse the legacy of the previous attack on the working-class in the Hartz IV reactionary reforms to the labour market and social welfare of the last SPD chancellor, Gerhard Schröder.
Its proposals for increases in public investment are also limited.
A ‘traffic lights’ coalition will mean that the Greens and the FDP will be able to act as barriers to significant moves to the left on economic policy.
The FDP, often described as a ‘pro-business party’, can be more accurately described as a ‘profits first, business party’.
The Greens have long since made their peace with capital.
On paper, they will be a radicalising force on climate change.
However, if the Greens prioritise the new cold war against China over international cooperation, it will damage their credibility on climate change.
Although Olaf Scholz’s electoral victory has strengthened his position in his party, he now faces a challenge from a rejuvenated left.
The SPD’s parliamentary presence has been invigorated by dozens of new left MPs from its Jusos youth wing.
Its federal chairperson, Jessica Rosenthal, wants to see Jusos ‘sat at the table’ for the ‘traffic lights’ negotiations. “For us, it is about social progress such as overcoming Hartz IV, as well as enforcing our youth policy demands.”
Jusos has also entered into a discussion with the youth wing of the Greens who just announced that “We have launched a campaign that makes it clear that social justice and radical climate protection are the conditions for any coalition.”
Points of disagreement
- The economy
The SPD and the Greens propose an increased tax liability on high incomes and the wealthy.
The FDP supports ‘trickle-down economics’ with cuts to taxation for businesses. They also want to increase investment in the German economy by tax inducements for private capital.
The ‘traffic lights’ talks will also see disagreements on the “debt brake” enshrined in the Basic Law, where the federal and state governments should as a rule cover their expenditures without loans.
In contradiction to the FDP, both the SDP and the Greens want to extend the “debt brake” to increase state investment in climate protection and infrastructure.
Olaf Scholz’s most popular election promise was to increase the minimum wage to 12 euros an hour if he became chancellor. The Greens also support this, but the FDP oppose it.
The latest news on wages and inflation will put the new government under pressure.
Sebastian Dullien of the IMK economic institute concludes that “The latest data suggests that wages in Germany will not keep up with inflation in the course of this year.”
- Climate change
The SPD and the Greens want to see more state intervention, including investment in renewables and regulations on emissions, as part of a timetable of climate change targets.
The FDP is against more government regulation and proposes financial incentives for the private sector as the best way to reduce Germany’s carbon footprint, and a consolidation of EU emissions trading.
- Relations with the USA
The US state will expect much more support in its cold war against China from a ‘traffic lights’ government than it had from Merkel or were anticipating to receive from Laschet.
US Secretary of State, Blinken, visited Berlin shortly before the German election.
He reaffirmed his expectations for future US-German relations, declaring that “The United States and Germany cooperate through several multilateral institutions, including NATO, the G7, the OSCE, and the UN, as well as through our U.S.-EU partnership, to advance security, democratic values, and the rule of law globally.”
Blinken’s diplomatic parameters are unlikely to be breached by an incoming ‘traffic lights’ coalition: all three ‘traffic lights’ parties remain firm Atlanticists.
Hitherto, Germany’s relations with China under Angela Merkel have been very pragmatic.
But the US will be hoping for willing helpers in its efforts to pull Germany and the EU behind its plans to stop China becoming a prosperous country in a multi-polar world.
The leader of the Greens, Annalena Baerbock, has been vociferous in her opposition to China’s right to self-determination and its commitment to catch up with the West’s levels of wealth and technology. The FDP shares these sentiments. It has removed its ‘one China’ policy from its platform.
The SDP has taken a more constructive approach to China.
Last year the SPD parliamentary group said, “For us Social Democrats, political relations with China have always been characterised by an ongoing political dialogue…. It is hard to imagine tackling the economic, ecological, social, and political challenges of our times without dialogue with China.”
Pro-US, anti-China hawks in Germany may end up talking loudly but thankfully will only carry a small stick.
In 2020 China was Germany’s largest trading partner. This will continue to have a decisive impact on relations with China.
Germany cannot act alone on China; it will be under pressure to work in collaboration with France and the broader EU.
Public opinion continues to be a problem for anti-China hawks in Europe.
Most Europeans do not support a cold war with China. Last month’s European Council on Foreign Relations report concluded that “a majority of Europeans do not see China as a threat to their way of life. In fact, only 5 percent of Europeans say they believe that China rules the world.”
In the coming weeks, the SPD, the Greens and the FDP are likely to reach an agreement on the terms of a coalition government.
The appointment of FDP leader, Christian Lindner, as finance minister, would be a bad omen.
Socialist Action will consider the programme of the new government when it is announced.
The official German election results
Jusos, Young Socialists in the SPD
OECD data for Germany