Merkel demands compromise in German coalition talks

Chancellor Angela Merkel has urged her would-be coalition partners to focus on political compromise and dispense with threats to call fresh elections.

Six weeks after the federal poll, Germany is still without a government as Dr Merkel and her centre-right Christian Democratic Union (CDU) negotiate an untested alliance with the liberal Free Democrats (FDP) and the centre-left Greens.

The FDP and Greens, from opposite ends of the political spectrum, have spent weeks sniping over whether to prioritise tax cuts or climate protection.

With an estimated €30 billion budget surplus forecast for this year, the FDP is demanding tax reform – popular with its liberal voters – and more restrictive immigration. The Greens are demanding a more open immigration policy and a push towards 100 per cent renewable energy by 2030.

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The FDP describes Green immigration demands as “illusory” while modern coal plants, the pro-business FDP says, are “indispensable” to ensure energy security.

Hitting back, Green Party leader Simone Peter has attacked the FDP for “playing into the hands of climate change deniers”, while attacking the liberals’ tough immigration stance as “populist platitudes”.

As coalition talks entered their second, formal round on Tuesday, Dr Merkel took to Facebook to demand the bones of a coalition deal by mid-November. “The question is how we can use the [financial] room for manoeuvre so that every one party has their policies prioritised,” she said, “while at the same time ensuring we have a balanced budget.”

Desired effect

The chancellor’s public intervention appears to have had the desired effect: on Tuesday the Greens conceded ground on clean energy and a demand to outlaw traditional engines by 2030. FDP leader Christian Lindner, meanwhile, admitted that his hoped-for €30 billion tax cut was “not realistic”.

As talks drag on longer than the election campaign, the greatest wild card for Dr Merkel in the coming weeks may now no longer be untested coalition partners but her long-term Bavarian sister party, the CSU.

After a disastrous election, the CSU is scrambling to reorganise itself ahead of a state election in the southern German state next year. Top of the agenda: a looming leadership heave against the long-serving CSU leader Horst Seehofer.

Buzzards circling

Long unchallenged in Bavaria, Mr Seehofer has attempted to put down the mutiny with talk of unspecified “consequences” for rebels. But the buzzards are circling in Munich, and looking on with interest is Bavaria’s finance minister, Markus Söder. With a sharp, populist tongue, Mr Söder is a divisive figure, with political ambitions Mr Seehofer has spent a decade trying to thwart.

But pressure for change is building as the CSU, which has ruled Bavaria continuously for 60 years, slides to 37 per cent in polls.

Bavaria was on the refugee crisis front line in 2015 and, after the CSU failed to secure an immigration cap from Dr Merkel, it has watched voters drift away to the far-right Alternative für Deutschland (AfD).

With a growing AfD challenge ahead of next year’s poll, Dr Merkel may find her conservative allies to be her greatest headache whenever a government is formed.