September’s Elections: Fresh Impetus for Germany and the EU or More of the Same?

COMMENT

September’s Elections: Fresh Impetus for Germany and the EU or More of the Same?

David Gow | 24 April 2017

EU Summit – October 2012, European Parliament, CC-BY-NC-ND-2.0

Too much wishful thinking can lead to bitter let-down. There are plenty of post-Brexiteers in mainland Europe as well as the UK pinning their hopes on a revivified, reformed EU after the French and German elections this year. These hopes centre on a transformed Franco-German tandem led by the positively pro-EU Emmanuel Macron and Martin Schulz in place of (tired old) Angela Merkel and Francois Hollande.

They are unlikely to be met. First, even though Macron has topped the first round of voting and is odds-on favourite to be elected in the May 7 run-off, he has still to win a parliamentary majority for his policies in the legislative elections in June – and his movement En Marche! hardly rates as an organised party. Nor is it clear that the revival in the electoral fortunes of the German social democrats (SPD) spearheaded by Schulz can be sustained. His and his party’s momentum is faltering.

Then, how different would the economic/social policies be that the pair would pursue in office compared with the orthodox pro-austerity, neoliberal (or ordoliberal) programmes overseen since 2011 by Berlin and Paris? Macron and Sigmar Gabriel, Schulz’s predecessor as Kanzlerkandidat, may have promised a fairly radical break with such policies two years ago but the French centrist social democrat already knows the pitfalls of pushing through reforms in France. What’s more, he is pursuing what one sympathiser has called ‘a pragmatic social-liberal offer with a pinch of Nordic flexicurity’ – with no guarantee of a parliamentary majority willing/able to implement it and see off inevitable street protests. Schulz, meanwhile, is rowing back from the outspokenly anti-austerity position he took as European Parliament president to sound like a pale echo of Wolfgang Schäuble, Germany’s ultra-orthodox finance minister (and the country’s most popular politician), in endorsing ‘structural reforms’ and ruling out debt mutualisation.

The German political context

Back in January, before Schulz took over from Gabriel as SPD leader, the party was polling as low as 20% in Infratest surveys for the conservative daily FAZ compared with 37% for Merkel’s centre-right CDU/CSU. By March 23, the two were neck-and-neck on 32% and other polls even showed Schulz ahead of the long-serving Chancellor in terms of popularity. No more. The latest barometer shows a (narrow) 3% CDU advantage (34%-31%) – reflecting the SPD’s poor showing in the Saarland state election on March 26 when it came 11 points behind the CDU on a 6% swing. The gap across the country is now 5% according to Spiegel Online’s ‘Sunday question’.

There are two more tests at Land level before the summer – Schleswig-Holstein on May 7 and North-Rhine Westfalia (NRW) a week later. Both are run by the SPD but the NRW poll is much more significant – it has 13.2 million voters and the biggest Muslim population of the 16 Länder. If Hannelore Kraft, the SPD state premier, loses to the CDU it may well be the best that Schulz can hope for in the federal elections in late September is to finish a stronger second and rebuild the grand coalition under Merkel, hoping perhaps she might quit mid-term.

But the Bundestagswahl is more than five months away. In the meantime, further terrorist incidents could push Merkel’s CDU to tack further to the right and formally abandon its liberal immigration policy that has caused much inner party strife. Similarly, they might boost the nationalist, far right Alternative für Deutschland that has been losing ground nationally, partly through a seismic rift between its leader Frauke Petry and a prominent internal opponent. So divisive that she has stepped aside as ‘Kanzlerkandidatin’.

What does seem certain is that the opportunities for building a ruling coalition will, theoretically, increase. Putting aside the pariah AfD, the CDU/CSU can probably look again at the Liberals/FDP, likely to re-enter Parliament after a four-year absence, and maybe even with the Greens (though they are shifting left after their own poor Saarland showing). Similarly, the SPD might opt for a red-red-green coalition involving die Linke, Germany’s equivalent of La France Insoumise (Unbowed) of Jean-Luc Mélenchon (unlikely).

There have been hopes/fears that Schulz would abandon his party’s espousal of neoliberal austerity politics – that have brought their Dutch sister, PvdA, to below 6% in the recent general election – and adopt a more robust social democratic stance. This would be based on boosting domestic demand through higher wages/investment in infrastructure and helping to reduce Germany’s record current account surplus (€270bn or 8.6% of GDP, way above the European Commission’s ‘imbalanced’ 6% threshold) by encouraging imports from the southern periphery countries of the eurozone. But, as some other commentators have shown, there is little sign of ‘polarisation’ between the two Volksparteien even if Merkel has talked of corporate tax cuts and Schulz of more generous welfare benefits. German economic policy remains profoundly orthodox and conservative.

EU prospects

The outcome of the September 24 general election could well be a patt (as you were) in the form of another grand coalition as favoured by a majority of German voters – even if the SPD stages a mini-revival. The latter will more than likely be insufficient to push Merkel out of the Bundeskanzleramt. The wider consequence would be little or no change in Germany’s policy towards the EU even with Macron in the Elysée.

That, too, has a bearing on the EU27 talks with the UK on Brexit, suggesting little or no change in the tough stance towards any concessions. And it would indicate little or no loosening in Berlin’s stern views on the ‘periphery’ countries. Chatter about relaunching the ‘project’ in the form of a hard core of eurozone countries speeding ahead with integration, adopting a second eurozone chamber in the Parliament, a eurotreasury as suggested once by Macron/Gabriel, let alone a common European unemployment insurance scheme, could well turn out just that: idle.

What is much more likely to inject any change will come from external threats: de-stablisation of the global world order, US military confrontation with Russia/North Korea et al, resumed refugee movements on a grand scale. This may be the year of Europe but it looks frighteningly similar from here.

David GowDavid Gow | Twitter

Sceptical Scot

David Gow is Editor of Sceptical.scot, Editor of Social Europe and Senior Adviser at CabinetDN, the public affairs consultancy. He is former European Business Editor of The Guardian and is Advisory Board Member of the Scottish Centre on European Relations.