Germany’s SPD: To Serve or Not to Serve under Merkel?

Just ahead of the German election on September 24th, three smaller parties including the right-wing AfD are gaining a little ground in opinion polls. Their move comes at the expense of Chancellor Angela Merkel’s center-right CDU/CSU and the center-left SPD of challenger Martin Schulz.

As a result, support for the CDU/CSU has slipped from an expected 38.5% share of the vote two weeks ago to 36.5% in the last five polls, whereas the SPD is down from 23.3% to 22.3%.

While the AfD has risen by two points from 8.6% to 10.6%, the Left Party (up from 8.8% to 9.7%) and the liberal FDP (from 8.7% to 9.1%) have also gained some ground.

However, the Greens have stagnated around 7.6%, even below their 8.4% result of 2013 and their 10.7% record of 2009.

In the race to become No. 3 in this election, the AfD have now edged slightly ahead. But the lead over the Left Party and the FDP is well within the margin of error.

The message of the polls: support for German political parties, in %

Centre-right CDU/CSU, centre-left SPD, centre-left Greens, liberal FDP, ultra-left The Left and radical right AfD, support in %, average of 7 latest available opinion polls; last entry for 16 September 2017 is average of five most recent polls. Source: Allensbach, Emnid, FGW, Forsa, GMS, Infratest dimap, INSA, Berenberg calculations.

The SPD’s conundrum

Facing likely defeat in the race for the chancellorship, the SPD is torn between two strategies.

The top party leaders in Berlin apparently want to stay on as junior partners in a coalition with Merkel. That would allow them to shape policy and keep attractive ministerial jobs.

However, many mid-level and regional party SPD stalwarts as well as many ordinary members worry that the SPD would continue to lose support in a further alliance with Merkel.

Instead, they argue, the party should renew itself by leading the opposition in the German Bundestag.

Also, if the SPD ends up joining yet another grand coalition government in Berlin later this fall, that could very well mean that the right-wing AfD ends up as not just the loudest, but also the biggest opposition party in the Bundestag.

The precise result will matter

Much will probably depend on the precise result for the SPD. If the party gets close to its 25.7% share of the vote of 2013, the SPD will likely feel confident enough to renew the coalition with Merkel.

However, if the SPD falls even well below its historic low of 23.0% of 2009, the party’s rank-and-file may rebel against party leaders and vote for a stint in opposition.

If so, a so-called “Jamaica” coalition — named after the black (for the CDU), yellow (FDP) and green colours of the Jamaica flag — could be the only option to form a government.

For Merkel, a new coalition with the experienced SPD would likely be more convenient than an alliance with two smaller prickly partners, FDP and Greens, who might devote some of their energy to jockey for position against each other even in government.

FDP: Anti-Europe?

Many observers have pointed out that the FDP seems less comfortable with the European agenda of French president Emmanuel Macron than Merkel, the SPD and the Greens.

If the FDP enters government, discussions about common funds for the Eurozone or other European reforms may initially be more rocky than otherwise. While not wrong, this argument is often overdone, though.

First, many FDP positions on EU/Eurozone issues do not seem to be too far from those of CDU finance minister Wolfgang Schäuble, a powerful force within the current and probably the future government. Some variety of views within government would not be new.

Second, the FDP itself is split on the issue, with a strong wing that seems to share Merkel’s fondness of Macron.

Third, FDP views would likely evolve if and when it settles into the role as party of government rather than extra-parliamentary opposition.

Conclusion

The election and subsequent choice of coalition matter. But the differences between the various options are modest rather than stark, especially when it comes to issues that matter for European politics and global markets.