Is the honeymoon over, Herr Schulz?

Within the last few weeks, the SPD candidate for German Chancellor, Martin Schulz, has seen his stock rise in Germany. However, this “Schulz effect”, which has brought high approval ratings to the SPD, now seems to have evaporated. The current polls in Germany (conducted by InfratestDimap) show the CDU/CSU and Chancellor Merkel back well ahead of the SPD and their new chairman Schulz. If the Germans could elect their chancellor by direct ballot, 46% would vote for Merkel (+10) and 40% for Schulz (-5), while in March the numbers were 36% for Merkel versus 45% for Schulz.

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POLITICAL REVIEW: Merkel gets boost from Saar Election, Schulz-Effect less impactful than thought?

Even Donald Trump congratulated Chancellor Angela Merkel directly, after her confidante Annegret Kramp-Karrenbauer won the Saarland state-election on Sunday with a strong 40.7% of all votes (+5,5). All other parties scored weaker than had been expected: the SPD 29,6% (-1), the Left 12,9% (-3,2), the Greens 4,0% (-1), the far right AfD 6,2% (+6,2) and the liberal FDP 3,3% (+2,1).

Many, including Ms Merkel attributed the CDU’s strength to the popularity of Ms Kramp-Karrenbauer. Yet, on a wider picture, the CDU’s success can also be explained by the fears many voters had regarding an SPD-Green-Left coalition. Had the Greens entered parliament, then such a coalition might have been possible — but about 57% of voters disapproved of it in polls. In Saarland, the SPD will join the government anyway. But voter’s disapproval of a Left Wing government sent a message that, if repeated in the state elections in North-Rhine Westphalia in May, could open a dilemma Social Democrats: They must campaign on the promise to topple Ms Merkel, but without relying on The Left. Acknowledging that problem, Bernd Riexinger as well as Ms Merkel aimed to push Martin Schulz, the SPD’s Chancellor candidate, into deciding on his coalition plans. Mr Schulz of course refuses to make such a statement so far. Yet the election has shown that the “Schulz-Effect” might be less impactful than thought.

That leaves the Greens, who have decided not to give any coalition preferences prior the federal election. So far, this has weakened them: Most disgruntled voters lean towards the SPD. In Saarland at least, the Greens lost enough votes to miss entering the state parliament — as did the Liberals. The weakness of the smaller parties, including the far right AfD, can be explained by the current CDU-SPD dichotomy. Albeit, the Saarland, holding 800.000 voters, is not representative picture of the entire country. Also, the discourse’s current focus on wealth redistribution might well change.

A possible trigger for crisis is, still, Turkey’s president Recep Erdogan. Turkish consulates opened the doors for his constitutional referendum this week. At an event organised by The Left Bundestag group, Mr Erdogan was harshly criticised it. Meanwhile Bundestag President Norbert Lammert (CDU) called the referendum a “putsch” and the Left Bundestag group’s chairwomen Sahra Wagenknecht called Mr Erdogan a “terrorist”.

POLITICAL OVERVIEW – Schulz receives 100% of votes, Merkel welcomes Macron, no AKP rallies in Germany

Martin Schulz, who still rides on a wave of enormous popularity, was formally elected party leader and chancellor candidate by all the party’s 605 delegates at the SPD party conference who casted a valid ballot. While some argue that the recent hype surrounding Mr Schulz might be unfounded, his 100% win is unprecedented. In his acceptance speech, Mr Schulz remained carefully unspecific, promising a more solidary education and childcare system as well as more labour rights and social benefits. Especially on taxes, Mr Schulz refused to give details: He rejects tax cuts, but declines to clarify whether he will support higher taxes for individuals or corporations, pointing to the internal programme drafting process.The issue will also be decisive in determining the SPD’s options to form a coalition with Greens and The Left. The CDU reacted to Mr Schulz’ strong mandate by lambasting the  SPD’s programmatic weakness, albeit without yet outlining their own programme. Ms Merkel herself so far refrained from any statements on Mr Schulz, leaving commenting to her party’s General Secretary, Peter Tauber. Campaigners in Saarland are increasingly nervous concerning this strategy: their voters go to the ballot this Sunday, with SPD and CDU on a par.

CDU General Secretary Dr. Peter Tauber on Schulz’ election: “It is 100% unspecific what the SPD is celebrating. While we are carrying the responsibility for a government, the Social Democrats are only out to give a show.” Image Source: Peter Koch

Shortly after visiting US President Donald Trump in Washington DC, Angela Merkel stressed the importance of free trade when holding the opening speech of the Cebit, with Japan as this year’s partner country. Just before, Ms Merkel had welcomed the French presidential candidate Emmanuel Macron in Berlin. While rumours say that Ms Merkel favours Mr Macron, the confidential conversation, which lasted about an hour, should not be read as an election recommendation: Ms Merkel already met Francois Fillon and only declines to host Marine Le Pen. While there was no common press conference following the meeting, Mr Macron held one on his own, and later debated Europe’s future with German Foreign Minister Sigmar Gabriel and Philosopher Juergen Habermas. Mr Gabriel, who earned some criticism for sharing a stage with Mr Macron, will meet his comrade Benoît Hamon next week.

Meanwhile, the row over Turkish referendum campaigning in Germany slowed down a bit. After another round of personal attacks from Turkish President Recep Erdogan, an AKP spokesperson announced that all events in Germany had been cancelled by his party. Shortly before, Ms Merkel had threatened to ban rallies if Mr Erdogan continued to compare the Federal Republic with Nazi-Germany. Some continue to worry: Exactly at the anniversary of the EU-Turkey refugee deal, some German media outlets worried about a recent uptick in refugee-arrivals in Greece. On Wednesday, in some cryptic comment, Mr Erdogan then stated “if they continue to act like that, no European, no citizen of the West will be able to step to the street in safety and peace.” While German media widely reported and the EU’s High Representative Federica Mogherini summoned the Turkish ambassador, the German government did not react.

Brexit’s counterweight – German people want more Europe

“Please don’t go!“ headlined the German magazine Der Spiegel just before the Brexit referendum, expressing the desire of a German majority for Britain to stay in the European Union. Only 7% of the German population supported the UK’s exit. This does not come as a surprise, as the German population perceives the UK just after France and just before the US as their most important partner for collaboration.

Brexit angst 

As a possible consequence of Britain leaving the EU, 58% of Germans expect other Member States to follow the British example in wanting to leave the European Union. Nevertheless,  the appreciation in Germany for the European Union rose: the proportion of those who connect benefits with an EU membership increased to 48%, while the proportion of those that associate more disadvantages to an EU membership, fell to a low of 14%.
Very much counter to the will underlying the Brexit vote, the desire for a closer union in Germany is now more widespread than the call for more national autonomy. 49% of Germans would prefer that member states unite more closely, 37% desire more autonomy, while 12% want no major changes. The Christian Democrats (CDU), Social Democrats (SPD), Left and Greens share in their support for a stronger EU, indicating that Germany’s European policy is unlikely to change after the next Federal elections in autumn 2017.

Political Berliners were particularly shocked by the result of the British referendum, which was seen by all parties as a very regrettable drawback for the European unification process. In response, they put forth a range of demands to accelerate integration, including the transfer of more sovereignty and competencies to the EU level, as well as overdue reform to EU institutions.

Merkel stays strong, and the Germans even stronger?

Immediately after the results were announced, Chancellor Angela Merkel insisted on ‘working to analyse the situation calmly,’ in her signature, even-keeled manner. Five days later, she explained in an official statement at the German Bundestag that while the UK’s decision to vote leave should be respected, the UK must still explain their desired alternative for a relationship with the EU. She underlined the bilateral relationship between Germany and the UK, their close alliance in NATO, and their sharing global leadership responsibilities, alongside the United States.

Theresa May and Angela Merkel meet in Berlin

The desire for deepened bilateral ties between Germany and the UK was underscored by the Chancellor during Prime Minister May’s first visit to Berlin on July 20th. Only two weeks prior, on July 7th, the German government installed an interdepartmental UK Task Force in the Ministry of Foreign Affairs to address the technical and political questions connected with Brexit. On the other hand, it will not be the Ministry of Foreign Affairs, but the German Chancellery, as well as the party and parliamentary party groups of the CDU/CSU and SPD who will have to manage the

German population’s rejection of concessions: 86% of the German people are of the opinion that the EU member states should not make any large concessions (49%) or make no concessions at all (39%) to the UK, only 10% of the people are for concessions.

A political puzzle

What became obvious in the weeks after the referendum was the growing rift between the suddenly united Christian Democrats (CDU and CSU) on one side and the SPD on the other.

Their disagreement, however, is not about Brexit itself. Both are willing to give the UK its due time to prepare for negotiations before initiating the Article 50 process; and both aim for a result that clearly differentiates between membership status and the UK’s future relations to the EU. Both also acknowledge the importance of the UK in security matters, and they appear willing to cede economic concessions in order to keep the European Union together.

Where both sides clearly disagree is over the future of the European Union itself. The SPD views Brexit as an opportunity to deepen European integration, mainly in security competencies. Secondly, they desire European funding for economic growth and labor markets, particularly in the south. Frank- Walter Steinmeier, Minister of Foreign Affairs, published a joint paper with his French counterpart Jean-Marc Ayrault focusing (not exclusively) on security and immigration policy, as did Vice-Chancellor Sigmar Gabriel with EP-President Martin Schulz with regard to economic policy. The CDU/CSU very much opposes SPD’s proposals for deeper economic integration. They agree that the common market needs strengthening, but vehemently oppose the SPD’s calls for harmonizing economic, social and labor policies as a means to do so.

Parliamentary pragmatism

Federal Minister of Finance Wolfgang Schaeuble of the CDU and Vice Chancellor Sigmar Gabriel of the SPD stand particularly divided about fiscal policy. While the SPD supports a counter-cyclical growth policy and calls for reorganization of the EU institutions, the CDU/ CSU coalition opposes further monetary easing and EU centralization. Media outlets such as Der Spiegel have called the debate the unofficial start of the election campaign.

Schaeuble was committed to strict fiscal austerity, but recently swayed the Commission to forgive Spain and Portugal’s burgeoning budget deficits that unquestionably surpass EU limits. Schaeuble’s intervention was definitely out of character, but may be explained by his overall political strategy. After all, Schaeuble understands that the EU can only solve its problems “promptly and pragmatically” and has advocated for more intergovernmental decision making, without the Commission leading negotiations. The Commission’s sanctions against Spain and Portugal would have faced approval by EU finance ministers, and Schaeuble stood to lose in either case: their rejecting the Commission’s decision would have cost Schaeuble political face, while approved sanctions would have likely cost Spanish Prime Minister Mariano Rajoy, Schaeuble’s conservative ally, his already-precarious government. Without a strong conservative front, Left-led France and Italy could outstep Germany’s CDU-led coalition in future EU-level negotiations.

Wolfgang Schaeuble, Minister of Finance

Meanwhile, Gabriel has always called for more EU solidarity and budget flexibility to allow EU leaders more room for maneuver, especially for crisis-stricken countries. Gabriel can count on the support of French President Hollande and Italian Prime Minister Renzi, whose countries could benefit from these arrangements. Although Schaeuble proved he is too pragmatic to be too dogmatic about austerity, it does not seem as if the CDU/ CSU parliamentary group will move away from its budget policy. Behind closed doors, Chancellor Merkel apparently strongly opposes any change of the Stability Pact. In her opinion, the EU’s budget is large enough; it should just be more efficiently distributed.

Portraits des Parteivorstands der SPD am 04.12.2011 in Berlin
Sigmar Gabriel, Vice-Chancellor, Minister of Economic Affairs and Energy, Chairman of the Social Democratic Party

At the same time, the SPD appears tired of their Chairman and most likely his candidacy for the chancellery. Many members of the party are disappointed with Gabriel’s crude criticism of Merkel as solely responsible for Brexit. There will be no immediate change, but with state elections in Berlin and other German Laender taking place in September, retaining SPD seats may prove vital for Gabriel going forward.

Towing a federalist line, with trepidation

In light of the recent terrorist attacks in Germany, the coup in Turkey and increasing criticism of her refugee policy, Chancellor Angela Merkel suffered a substantial loss of confidence in recent weeks: Currently only 47% of the population express satisfaction with her work, which is the second lowest rating in this legislature. Likewise, the satisfaction with the work of the federal cabinet has fallen. Currently Merkel’s cabinet has only a 44% approval rating.

Still, the overall political mood in Germany is to a large extent stable. If federal elections were to be held next Sunday, the CDU/CSU would receive a 34% share of vote; the SPD would receive 22%; the Green Party, 13%; and the Left Part, 9%. While the FDP (Liberal Democrats) could re-enter the next German parliament with a possible share of 5%, the national conservative AfD would for the first time after World War II be to the right of the CDU/CSU in the parliament with 12%.

The Chancellor is tracking the current fragmentation of the German political landscape closely. More so than all chancellors and CDU party leaders before her, Merkel makes use of opinion polls and observes medium-term and long-term trends in her considerations. With an eye to Germany’s internal politics and the upcoming state elections, she will therefore act cautiously, pragmatically, and free of ideology in talks about the reform of the EU and the Brexit, in order to avoid aiding and abetting the AfD or a theoretically possible alliance between the Left Party, the Green Party and the SPD.

In Brussels, Berlin will moderate European processes even more clearly than in the past, integrating the interests of smaller EU countries in order to prevent a further disintegration of the EU. British PM Theresa May will be able to rely on the decades-old tacit alliance between the UK and Germany. However, as long as Germany continues to pursue deeper European integration and the long-term objective of a political union in Europe, the idea of an alliance between Germany and UK, mooted by David Marsh at the end of July in „Der Spiegel“, is more an academically appealing debate than a real political option.