"Voters handed the real power to two smaller parties, the Greens (Die Grünen) and the liberal FDP, who are now guaranteed to be part of almost any possible coalition."
With the centre strengthened and the fringes weakened, Germans decided to vote for political stability. This is good news and should not be underestimated if compared to other countries where the far-right and populist parties have gained much support in recent years. However, while putting up stop signs to radical parties on the right and left, voters also abandoned the two people’s parties, CDU and SPD, the conservatives and the social democrats.
The social democrats have been struggling with this downward trend already for many years and now even enjoyed a comeback of sorts, but being diminished to party in the 20 per cent bracket is a first for the CDU, the bastion of Angela Merkel herself. Until last weekend, both saw themselves as the last Big Tent party standing. The illusion is now broken.
In fact, voters handed the real power to two smaller parties, the Greens (Die Grünen) and the liberal FDP, who are now guaranteed to be part of almost any possible coalition. If they manage to find common ground, they could together wield great power. But the burning question is: Are they able to compromise?
Greens and Liberals are far apart on a whole range of issues. The most divisive one is probably more of a philosophical debate: What is the role of the state and to what extent should the state be able to interfere in people’s individual lives? While the Greens are ready to draw numerous red lines and even fine citizens for overstepping boundaries, the Liberals reject excessive state intervention as an ill-advised approach.
This divergence becomes most obvious in the way both parties want to tackle one of Germany’s most pressing issues: the fight against climate change.
The Greens advocate setting clear caps for CO2 emissions and tight deadlines for the companies to meet. For their part, the Liberals prefer to use market-based tools, such as trade with emission certificates, to achieve the same goals. The FDP believes the market knows what works best and should be left alone to decide whether electric batteries or hydrogen will power industry and mobility. It is not the overall goal – climate neutrality – that is disputed but rather the means to get there.
The two parties are also at odds on taxation and spending. The Liberals worry higher taxes might further damage Germany's image as a place for investment. According to OECD data, Germany already is ranked second with regard to labour taxes in Europe, with only Belgium levelling higher duties on its citizens and companies. The FDP fears another tax hike -- like the introduction of a wealth tax and a property tax proposed by the SPD and Greens -- would scare off entrepreneurs and foreign investors. Moreover, the FDP wants to rein in state debt that has ballooned due to the fight against the pandemic and will hit the 75 per cent of GDP mark next year.
Even if it’s still difficult to see how the partners-to-be can bridge these major gaps, there is nevertheless common ground. Greens and Liberals agree that digitisation and education in Germany needs a do-over. Germany is lagging behind on digital infrastructure; both parties are fighting against data monopolies. Education and research require strengthening. Greens and FDP are also in favour of the modernisation and liberalisation of immigration policy.
There is also considerable overlap on the role human rights should play in foreign policy. Both parties see China and Russia with a critical eye.
In particular, China could spark significant conflict with Olaf Scholz, the SPD leadership and the German industry that is heavily dependent on sales to and from Beijing. Scholz, currently minister of finance, knows only too well how important relations to China are to maintain jobs in Germany. Volkswagen, for example, is selling over 40 per cent of its cars to China. A "decoupling" from China or even a stark reduction of economic ties will not be accepted by Scholz and his fellow socialists.
The situation is similarly tricky regarding Russia. While the two small parties hold no punches when calling out President Vladimir Putin for turning the country into a de-facto dictatorship bereft of free speech, the Social Democrats pursue a much softer line. The SPD famously supported the construction of the controversial Nord Stream 2 pipeline, which, once activated, will bring more natural gas from Russia into Germany and Western Europe. The Greens are adamantly opposed to the conduct, which they argue exacerbates reliance on fossil fuels.
There is yet another commonality. Since both parties were supported largely by the youth, FDP and Greens represent an electorate that is here to stay while the supporters of the SPD are older and much more traditional in their thinking.
Still, the question remains whether all this common ground is sufficient to make up for the ideological divisions. The leaders, Christian Lindner of the FDP and Robert Habeck and Annalena Baerbock of the Greens, therefore must hammer out a solid platform that will hold over four years. The SPD, seeing themselves as the real winner of the election, watches the rapprochement of the two potential coalition partners with suspicion. However, there is not much they can do. For them, practically no other coalition option is viable.
And what about the so-called Jamaica coalition, putting together the CDU, Greens and Liberals?
This is an option very unlikely to materialise given the scope of the conservative defeat. It is neither feasible how the Greens could explain to their supporters why they want to help a weak CDU candidate like Armin Laschet enter the chancellery. Nor would that move benefit in any way the green cause, which is the vigorous fight against climate change. Being confronted with a solid block of politicians from the FDP and CDU, the Greens could find themselves in an uncomfortable spot.
Furthermore, Jamaica 2021 is not the same constellation as Jamaica 2017 that almost came to fruition when Angela Merkel was running the show. Merkel, who had great sympathy for the Greens, will soon be gone and thus a big champion of such a coalition.
These days, Germans clearly see Jamaica as the second-best scenario and show little appetite for it. This is partly because, after the last election, voters were already served the second-best option: the grand coalition between CDU and SPD, which was formed only because no other alternative was in sight. This time around, Germans want just the first dish.
Markus Ziener is a Helmut Schmidt Fellow at the German Marshall Fund of the United States