Merz Hits the Gas

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Michael Lucan / Wikimedia

After their victory in Germany, the conservatives decided to speed up the process of forming a governing coalition as much as possible

On February 28, the first round of so-called exploratory talks between the conservatives and the Social Democrats on forming a government coalition took place in Berlin in an accelerated manner. Observers had expected the process to begin later — after Sunday’s state elections in Hamburg and the conclusion of the final week of traditional carnival parades. The merry four-month celebration will end exactly 40 days before Catholic Easter on Ash Wednesday, March 5.

But Friedrich Merz, the future chancellor and leader of the victorious CDU/CSU bloc in the early elections, decided not to wait. Moreover, after the early voting on February 23, the only possible (politically and mathematically) alliance based on a parliamentary majority emerged — the «Grand Coalition». Merz was further spurred on by the dramatic development of current international events, especially the intensification of the Ukrainian crisis and the emerging rift in transatlantic relations. He decided not to leave the situation in the hands of the still ruling minority government led by Olaf Scholz, but to seize power as soon as possible. Moreover, Merz had already promised to visit the Chancellor’s Office before the Easter holidays.

In the first round of talks, which preceded the broader negotiations, each side was represented by nine participants. The conservative team was predictably stronger: it was led by Merz himself and Bavarian CSU leader Markus Söder. The Social Democrats were represented by fewer figures, as their leader, Olaf Scholz, declined to participate. He stated that he was not seeking a role in the government and would limit himself to the mandate he had won as a member of the Bundestag. Instead, the delegation was led by the party’s two co-leaders — Saskia Esken and Lars Klingbeil — and supported by the current Minister of Defence and Germany’s most popular politician, Boris Pistorius.

It seems that the intensive dialog will continue in exactly these compositions. Incidentally, Merz suggested that, given the pace of change in the world, the traditional practice of drafting a multi-page coalition agreement should be abandoned in favor of a compact plan outlining key actions for the coming months.

The talks took place behind closed doors, but the contentious issues that will need to be ironed out are already known.

On migration policy, the approaches are not as irreconcilable as they might have seemed in light of the controversial resolution passed in the Bundestag on February 23 at the initiative of Merz and with the support of members of the unsavory «Alternative for Germany», calling for a tougher stance on refugees, followed by an unsuccessful attempt to pass a law based on these theses. The future chancellor was unanimously condemned — and he apologized. Experts believe that without the Greens, with their extremely liberal attitude toward migrants, the Social Democrats might be more conciliatory.

It will be more difficult to reconcile their approaches to accelerating the economy’s recovery from stagnation, stimulating it, and supporting the Kiev regime. The Social Democrats favor state-led management of the process, while the conservatives are market-oriented, advocating deregulation of the economy, tax cuts, and reduced bureaucratic oversight.

A serious problem has arisen. Additional funds are needed to increase defense spending and provide further assistance to Kiev — but where will these funds come from? The conservatives hope to create another off-budget fund for the Bundeswehr or to increase the existing one from 100 to 300 billion euros. The Social Democrats propose revisiting the limits enshrined in the Basic Law — the so-called «debt brake» — to secure new loans. This fiscal rule is designed to stabilize debt and prevent excessive borrowing by limiting the budget deficit to 0.35% of GDP.

It remains unclear what the compromise will look like. Each side’s proposals require constitutional amendments, which require a two-thirds majority in parliament. In the new Bundestag, however, the Alternative for Germany and the Left Party together will have a so-called «blocking minority» of more than one-third of the seats. Therefore, it is possible that during the ongoing consultations, the parties will try to quickly pass urgent measures with the current parliamentary composition, where the necessary majority is present.

In foreign policy, Merz hopes to gain the authority to pursue a tougher and more decisive course. First and foremost, he plans to «repair Franco-German relations» against the backdrop of Europeans cowering before Trump like a deer in the headlights. Friedrich wants to steer the EU towards «real independence from the United States in the field of security».

Time is of the essence — things are just too turbulent and fast moving. Therefore, it has been decided to hold the next round of exploratory consultations next week. In the meantime, Scholz will be making the rounds of all the urgent European summits and meetings announced by Brussels, London and Paris — mostly as a formality. However, he is likely to miss the festive carnivals, as will those planning to cobble together the «Grand Coalition».