The German Election – A Pyrrhic Victory For Merkel

Results of elections to the German Bundestag (Parliament) are both satisfying as well as disappointing for Chancellor Angela Merkel. It is satisfying because she won a remarkable fourth term with her party, the Christian Democratic Union (CDU) emerging as the single largest party in the Parliament. This will make her tenure of 16 years by 2021 equal to the longest serving Helmut Kohl who served as Chancellor from 1982 to 1998. But the results are disappointing because this is the worst ever performance by CDU since it was established in 1945. CDU vote share is much below what Merkel had expected.

Another significant but foreboding development in these elections is the robust emergence of the far right party, Alternative for Germany (AfD), which would be the first time in almost 60 years that an openly nationalist party will enter the Bundestag.

German Electoral System

Germany uses a somewhat complex system of voting to determine representation in the Parliament. The House consists of 598 members out of which one half (299) are elected by first past the post system and the other half (299) through the proportional representation system. Seats are distributed between 16 German states in proportion to the states' population eligible to vote.

Every elector has two votes – the first to vote for the constituency, and the second for the party list. The single-member constituencies elect their representatives by counting the first votes. The second votes are used to produce an overall proportional result in the states and then in the Bundestag. If a party wins fewer constituency seats in a state than its second votes would entitle it to, it receives additional seats from the relevant state list. If a party by winning single-member constituencies in one state receives more seats than it would be entitled to according to its second vote share in that state, the other parties receive compensation seats. Owing to this provision, the Bundestag usually has more than 598 members. The 18th and current Bundestag, for example, started with 631 seats: 598 regular and 33 overhang and compensation seats.

Election Results

Angela Merkel-led CDU which promotes a policy of liberal conservatism and right of the centre ideology has won 246 seats with a vote share of 32.9 per cent. This represents a decline of 65 in the number of seats from the 311 that the party garnered in 2013. Vote share has come down by 8.6 percentage points from the 41.5 per cent it won in 2013.

Martin Schulz-led Social Democratic Party (SPD), which occupies left of the centre position and espouses social democracy as its ideology has not fared any better, possibly even worse, registering its worst ever performance since 1949. It won 153 seats with a a 20.9 per cent vote share which was lower by 40 seats and 5.2 percentage points vote share from its performance in 2013. SPD was a in a grand coalition with CDU/CSU since 2013 but Schulz has announced that he would not continue this after the polls as he wants to rejuvenate his party.

AfD, the extreme right, anti immigration party is the biggest gainer and is making a decisive and emphatic entry into the Bundestag. AfD was established as recently as February, 2013. It won 12.6 per cent votes as against 4.7 per cent in the last elections, a gain of 7.9 per cent. It has got 94 seats in the current Bundestag while it had no representation in the last Assembly. It has won primarily by opposing Merkel’s policy of immigration when she allowed a million refugees from Syria and elsewhere to enter Germany in 2015. The fear triggered by refugee influx and its aftermath appears to be the single biggest reason for AfD’s surge. AfD draws most of its support from east of the country which feels disenfranchised.

The fourth largest party is the pro-business Free Democratic Party (FDP) with centre and right of the centre liberal ideology. It is also a new entrant to the Bundestag with 80 seats and 10.8 per cent vote share. It did not have a representation in the last Parliament as it was able to muster only 4.8 per cent of votes which is less than the minimum 5 per cent threshold for representation in the Bundestag. Ideology of FDP is close to that of CDU which makes it the foremost candidate for entering into a coalition with Merkel to form the next government.

The Left party espousing far left policies is the fifth largest entrant with 69 seats and 9.2 per cent vote share. These figures are more than the previous result of 2013 by 5 seats and 0.5 percentage points vote share.

The Green Party which is the last and sixth party has also marginally improved its performance by winning 67 seats, which is four more than last time, and picking up 8.9 per cent votes which is 0.6 percentage points more than what it obtained in 2013.

Challenges Confronting Merkel

The first challenge that Merkel will have to confront is to constitute her government by selecting suitable partner(s). The Grand Coalition with SPD is no longer viable as Schulz has already declared his intention to sit in the opposition. This will deny the position of main opposition party and all privileges that accrue with that position to AfD.

The most practical coalition partners for CDU currently appear to be FDP which shares most of the policies of CDU, and the Green Party. This would ensure a support of 52.5 per cent in the Bundestag. Merkel will have to contend with the fact that FDP and the Greens don’t see eye to eye on several economic and environmental issues, the most contentious being the demand by the Greens to shut down 20 coal fired power plants in the country. Such conflicts will have to be resolved by Merkel in due course if this coalition does come into being.

Merkel could also consider forming a minority government and seeking issue based support from parties like SPD, FDP etc. This appears unlikely as Merkel has declared her resolve to provide a stable government to last the full term of four years.

Merkel has also declared her intention not to have any truck with AfD. Other parties like SDP, FDP etc also do not wish to cede any political space to this party. Merkel has however stated that she will reach out to AfD supporters to understand their concerns and wean them back into her fold. CDU seems to have ceded more than a million voters to AfD in the current election.

Challenges that Merkel faces in governance are considerable and daunting. While Germany is enjoying something of a golden age in economic terms, there are plenty of signs of trouble ahead, from problems in the ailing steel industry, which employs thousands of workers to the automotive sector.

The country’s economic robustness is likely to be dented by a looming demographic crisis which over the next few years will see baby boomers go into retirement. While the country’s chronically low birth rate has recovered somewhat in recent years, it has occurred far too late to manage the shortfall. The hundreds of thousands of refugees Germany has taken in are often viewed as being a partial solution to the demographic crisis. However challenges of integrating and assimilating them into German society and the workplace remain immense and will require more guidance and fine-tuning – both financial and legislative – from central government. Merkel will need to address the pressing demands for reform of German immigration policy to ensure a more controlled flow of skilled and semi-skilled workers, as well as investing more in training and education at home.

Merkel will be called to play a central role in the Brexit negotiations. She can be expected to take a tough line in talks with Britain. With France’s president Macron, she will need to work closely on EU reform including towards the introduction of a European Monetary Fund. She will have to ensure a successful partnership with Macron to ensure European security and stability.

Merkel’s re-election and continuation as Chancellor is reassuring for India. A positive, respectful, mutually supportive rapport has developed between Prime Minister Narendra Modi and her. Germany is actively engaged in several economic initiatives like Make in India, Skill India, smart cities, building infrastructure etc that India has launched over the last few years. That Germany’s reins will continue to be in Merkel’s hands will ensure continued focus on strengthening and expanding bilateral ties.

Merkel will face a tougher period in office over the coming years than in her previous three terms due to the more fractious domestic politics as also due to growing uncertainty in the international environment. The presence of a tried and experienced hand at the rudder of the largest economy and most important European country will be reassuring for Europe, for India and the world.