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Political lessons from Madrid to Berlin

24 Nov 2017
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EU/Eurozone

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After the withdrawal of the liberal FDP from coalition negotiations, German politics is faced with a similar dilemma to Spain in 2015-2016: an inconclusive set of elections, the unwillingness of the centre-left to support the incumbent centre-right Prime Minister, and ultimately the possibility of another set of elections. In both instances, it was up to social democrats to resolve the stalemate; what lessons can the German Social Democrats (SPD) learn from the Spanish experience?

How the Spanish Socialist Party (PSOE) handled the choice between supporting a centre-right government or forcing another election may be instructive to the SPD. The PSOE’s firm refusal to prop up a centre-right PP government saw another round of elections in 2016 that were equally inconclusive, and the party’s leader – a firm opponent of a deal with the PP - was eventually pushed out so that the PSOE could allow the PP to form a government and avoid yet another round of elections in extremis. Martin Schulz has taken a similar position to Pedro Sanchez, and is now facing the same sort of pressures by a party establishment that fears an even worse election result. The party leadership today has hinted that it may revisit its total opposition to a deal with the Christian Democrats (CDU), aware that there are few indications that a re-vote in Germany would even unlock the situation. For the SPD, allowing a CDU government – whether or not in full coalition – may be the least bad option.

Merkel has stated that she is only willing to lead the country if there is a ‘stable government’, and will otherwise prefer early elections. Nevertheless, a pledge by the SPD to allow the CDU to govern, even in a minority, would prove difficult to refuse. An early election may not change the electoral arithmetic, and Merkel risks alienating her key potential governing partners. If a full coalition is refused, a minority government remains a workable option. Despite running contrary to Merkel’s governing style, it does not have to be unstable, as demonstrated by Rajoy’s experience of leaning to the left or the centre depending on the issue.

Spain also holds lessons for the FDP, who may have looked at the actions of the centrist Ciudadanos. Refusing to enter into coalition with the People’s Party, and instead choosing to negotiate with the government on a case-by-case basis allowed the party to gain specific concessions – for example reductions in income taxes – while avoiding getting tainted by other unpopular government decisions. This decision has paid off, and the party’s support has actually increased since the last election. Lindner’s rejection of coalition with the CDU, but leaving the door open to negotiating at a later stage, reflects the FDP’s scars from the 2013 experience that saw the party decimated after a coalition with Merkel. It is perhaps no surprise that the ‘Ciudadanos option’ is looking increasingly attractive for Lindner. Spain is usually the one looking to learn from Germany, but in this case, there are some political lessons in the opposite direction.

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