The aura of invincibility around Merkel has been shattered. Can she bring together a workable coalition to stop Germany from falling deeper into a crisis?

The German Bundestag (Federal Assembly) elections delivered a bomb shell: the right-wing extremist party “Alternative für Deutschland” (AfD) achieved a spectacular victory. It entered the assembly with 12.6 percent of the votes to become the third largest party in the Bundestag.

It was no surprise that the radical right—on the rise in much of Europe—also swept across Germany. The fact that it became the third largest party with no historical presence in the Bundestag was the biggest surprise.

In the wake of the elections, when no party wanted to form a coalition with the AfD and the SPD announcing that it would remain as an opposition party, there was only one coalition option left: “the Jamaica Coalition.” So called because of the colours of the parties involved: black of the CDU, the yellow of the liberal FDP and the Greens.

The elections delivered its second bomb shell on the night of the 20 November when the parties came out of the exploratory talks with empty hands. Negotiations on a possible arrangement between the three parties had been going on for almost a month. Yet the litany of issues the parties had to agree on were difficult to overcome: refugees uniting with their families, coal energy, climate protection, the European Union, Turkey’s accession to the EU and Germany-Turkey relations, ultimately proved too much. With the talks coming to an end and proving inconclusive the prospect for early elections became the most likely outcome.

How did Germany and Merkel, recently crowned the “leader of the free world” come to this point?

The impact of a right-wing populist party

Forming a coalition government in Germany has never proved this difficult. Today, however, German politics has become increasingly polarised. The most significant reason behind this is the rise of the right-wing populist party, the AfD. By heavily focusing its discourse on anti-Islam and anti-refugee sentiment it has managed to make these central issues in the public’s imagination.

As a result many parties also chose to adopt some of the same rhetoric, seeing it as a way to gain more votes.

When the AfD garnered enough votes to enter the Bundestag, it also precluded the possibility of a workable coalition with the remaining parties. With Martin Schulz of the Social Democrats previously having ruled out another grand coalition with Merkel’s party, that only left a group of disparate parties to eke out a coalition.

It remains to be seen whether Merkel can coax Mr Schulz of the Social Democrats into another grand coalition.

Being the crownless queen of Germany and Europe, Merkel was not able to achieve a positive result even as she remains the single most important figure in German politics. Just like in 2005, the liberal FDP scuppered the chance of forming the “Jamaica coalition”, Merkel’s position on migration has undoubtedly been her undoing.

The power of the AfD was most clearly demonstrated when Merkel was unable to form a coalition. Merkel, as part of the coalition, put forward an immigration quota of 200,000 people per year. The liberal FDP wanted to keep this quota between 150,000 and 250,000. While the Green Party did not agree with others regarding this immigration quota.

Even though Merkel’s party managed to win the largest share of the vote, it was a humbling experience, her grip on power was severely weakened, possibly irreparably. The fall in the share of the electorate voting for Merkel coupled with an inability to cobble together a working coalition has meant the German political class asking, not if, but when she will go.

The impact on political instability in Germany on Europe

Germany, long portrayed as an example for its ability to manufacture political consensus now finds itself paralysed by a host of internal issues that show no signs of going away.

Therefore, not being able to form a government in Germany, which has the strongest economy in Europe, shocked many EU countries. The European landscape, due to a host of different reasons has become more fragmented. The rise of populist parties and widening discontent and polarisation has left many leaders from traditional parties unable, or slow, in dealing with these challenges. Now the extreme fringes, even when not in power, drive social and political agendas and conversations. The US, UK and the Netherlands are good examples of this, but they are not the only ones.

It is also for this reason why early elections, as Merkel has suggested, may not work out as she has planned. Looking across the English Channel, there is one Theresa May that in hindsight regret trying to get a stronger mandate.

Each passing day without a coalition works against Merkel and her position. Her only hope is her previous coalition partner, the SPD.

After Mr Schulz of the SPD announced a change of heart announcing his intention to negotiate with Merkel to form a coalition, a new hope flared up. President Frank-Walter Steinmeier’s intervention in the situation and invitation for both sides to find common ground led Merkel and Schulz to come closer.

The coming days are of critical importance in terms of the future of Germany and Europe. If Merkel and Schulz cannot reach an agreement and call for early elections, it will be the AfD which will benefit most out from this situation. Neither of those parties are willing to take that risk. Both parties have become united by a new consensus: fear.

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