One country, two governments

German politics

Jul 7th 2005 BERLIN
From The Economist print edition

Gerhard Schröder loses a vote of confidence, but his likely successor, Angela Merkel, is unsure how to campaign

HISTORY has made Germans distinctly wary of political experiment. Still, these days they are being treated to a rare democratic spectacle. The country has, in effect, two governments: one that is trying to get out, but may not be allowed to; and another that is likely to get in, but has yet to make up its mind exactly what to do.

On July 1st, Chancellor Gerhard Schröder engineered his own defeat in a vote of confidence in the Bundestag, the lower house of parliament, enabling him to ask the federal president for a dissolution and an early election in September. On July 11th, all eyes will be on Angela Merkel, leader of the opposition Christian Democrats (CDU) and Mr Schröder's likely successor, when she presents her party's “government programme”.

This two-headed rule is not quite what Mr Schröder had in mind when he said that he would seek an early election after his Social Democratic Party (SPD) was crushingly defeated in North Rhine-Westphalia's state election on May 22nd. To him, it was mainly an act of self-liberation.
Mr Schröder felt boxed in, not only by left-wingers in the SPD and by the opposition, which controls the Bundesrat, or upper house, but also by Germany's dire fiscal situation and a visa scandal. “If we want to release energies and implement further reforms, we must crack the physics of power,” he declared enigmatically in his speech before the vote of confidence.

Cracking the physics of power is hard in Germany. In the name of political stability, the country's constitution makes it difficult to dissolve parliament. If a chancellor wants to go to the country, he cannot just engineer a lost vote of confidence; he must, to quote from a ruling on the matter by the Constitutional Court, demonstrate that he no longer has “continuing parliamentary support”.

Since Mr Schröder made his decision to call for an early election, Germans have been treated to weeks of speculation over exactly how he would go about losing a vote of confidence. In the end, the SPD's parliamentary group was “invited” to abstain. And Mr Schröder argued that, given mounting internal and external opposition to his reforms, the “democratic sovereign” should now decide.

The question is whether Germany's president will agree. Horst Köhler will be especially anxious that the Constitutional Court does not overrule him. A few members of parliament have said that they will file a complaint if the president calls an early election. By coincidence, on the day of the vote of confidence, the court issued an opinion suggesting that an election could take place on September 18th “or later”, triggering speculation that the judges might yet order a delay. Yet in practice neither Mr Köhler nor the court is likely to stand in the way, because to do so would be to go against the will of parliament, the main parties and most voters.

Many in the SPD would be relieved if the election were not to go ahead, because the forces unleashed by Mr Schröder have not done the party any good at all. Far from generating new momentum for the government, they have sped its decline, not least by driving a wedge in the SPD's coalition with the Greens. The SPD is now running below 30% in the polls and the party has responded by moving to the left. In some ways, it is already behaving as if it were in opposition. Its election programme, presented on July 4th, boasts such classic left-wing gestures as higher taxes on the rich and a minimum wage.

All this should make life easier for Ms Merkel, the CDU's candidate for chancellor. Indeed, since Mr Schröder's announcement of early elections, Germany has gone through something akin to Merkel mania. In the space of a few weeks, her popularity rating has shot past the incumbent's. The media have taken to her, and even begun printing nicer pictures (a development helped by a makeover, a new hairstyle and more smiles). She was the undisputed star of many of Berlin's summer parties last week.

Yet Ms Merkel would be the first to concede that reality will sooner or later hit back. In fact, where Mr Schröder wants to shatter the “physics of power”, Ms Merkel is trying to contain it. Maybe this reflects her background as a physics professor; to her scientifically trained mind, rationality is important. But she must also fear the fate of Edmund Stoiber, the opposition's candidate in 2002, who unexpectedly lost to a rejuvenated Mr Schröder.

When Ms Merkel presents her programme next week, it will be treated by many as her first big appearance as chancellor-designate. At first, it seemed that she would not spell out tough reforms and budget cuts ahead, to protect herself from attack—a strategy that helped the CDU to victory in North Rhine-Westphalia. Yet this approach has triggered criticism within her own party, and a few calls for her to tell voters the truth.

If insiders are to be believed, the programme will now be more honest. Yet it will not be as straightforward as it should be, because of the constraints operating on Ms Merkel: the budget deficit, diverging interests within the opposition, the SPD's move to the left, a new left-wing party (now called the “Left Party”) and, not least, the prevailing pessimism that makes many Germans want to discount everything that politicians say.

A Chancellor Merkel would probably first try to introduce labour-market reforms, such as reducing job protection. More expensive measures, such as a flat-rate health-care fee and a simpler tax system, will have to wait. To pay for them, the programme is likely to include an increase in value-added tax, from 16% to 18%, and a cut in such tax subsidies as deductions for commuters. To avoid appearing too liberal, there will also be some gestures to demonstrate social balance. Ms Merkel hopes to present all this while sounding simultaneously credible and optimistic.

Which of Germany's two governments will remain standing after the election? It is hard to see a looming war or a natural disaster big enough to save Mr Schröder and his government this time (the prospect of a war in Iraq and a flood in eastern Germany did the trick last time). And it seems all-but certain that the CDU will emerge with the most seats in parliament, even if it does not manage to secure enough for an absolute majority.

Other than this, however, all bets are off. In some ways, the election may be more about Ms Merkel's four-month “tenure” as chancellor-in-waiting than about Mr Schröder's record. In the polls, at least, the CDU seems to have peaked already. And the new Left Party could do better than is at present expected. The latest opinion polls give it over 10%. If these trends hold, it could be difficult for the CDU and its coalition partner, the Free Democrats, to form a majority.

It is thus conceivable that Germany's two governments could be pushed into one: a grand coalition of the CDU and SPD. Would this be good for the country? Opinion is divided, since the only grand coalition tried, in 1966-69, is widely deemed to have been a failure. Some joke that there is only one person who could make such a configuration work as chancellor: Mr Köhler, who has become one of Germany's most popular politicians. Now that would be a new political experiment.

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