Coalition Strains as Vice Chancellor Says Germany Risks Political Crisis at ‘Worst Time’

Some experts say Germany’s coalition is ‘on the brink of collapse’ with leaders possibly waiting until after the U.S. election results to make an announcement.
Coalition Strains as Vice Chancellor Says Germany Risks Political Crisis at ‘Worst Time’
German Economy and Climate Action Minister Robert Habeck speaks during a news conference on the future use of liquefied natural gas (LNG) in Berlin, Germany, on Aug. 16, 2022. Lisi Niesner/Reuters
Owen Evans
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Germany’s coalition leaders are meeting this week for crisis talks seeking to prevent a political impasse that Vice Chancellor Robert Habeck warned would strike “at the worst possible time” for the country’s stability.

The governing coalition, comprising the Social Democrats (SPD), Greens, and Free Democratic Party (FDP), faces increasing pressure as disputes about economic priorities continue.

The FDP made in its paper—which the party initially said had been disclosed by accident—a suggestion to delay by five years the target date for some net-zero goals.

However, Greens co-leader Omid Nouripour rejected any softening of climate goals.

“We don’t want to break the coalition. ... We expect the others to stick to their commitments,” he said.

On Monday, ahead of a cabinet meeting set to discuss an array of economic measures on Wednesday, Habeck, also the Green federal minister for Economic Affairs and Climate Action, said he made a significant concession in an effort to stabilize the ruling coalition.

“The last few days have produced a cacophony rather than a united government line,” Habeck said at a press conference.

He said that failing to get the budget in order could lead to a prolonged impasse in Germany “at the worst possible time,” implying this could further delay necessary economic recovery measures.

To address budget challenges, Habeck indicated he would support reallocating 10 billion euros (about $10.9 billion) originally meant to subsidize Intel’s chip-making plant. The U.S. tech giant announced in September that it was pausing construction at its project in the city of Magdeburg for two years.

‘Brink of Collapse’

The parliament’s term will end next September; however, some believe the coalition could end shortly.

Richard Schenk, a research fellow at the think tank MCC Brussels, told The Epoch Times that he believes the coalition is “on the brink of collapse,” noting that media outlets have echoed these concerns and speculated that an announcement could come as early as Wednesday or Thursday.

“Basically, everyone knows it’s about to collapse,” he said, attributing the delay to concerns over the global political situation and the outcomes of the U.S. presidential election.

Schenk also noted that Germany’s economy—Europe’s largest economy—is expected to experience stagnation or even recession for a third consecutive year.

Instability

A potential collapse could lead to Chancellor Olaf Scholz governing through a minority government and relying on ad-hoc parliamentary majorities.

This instability comes as the SPD and Greens continue to poll well below their 2021 election results, with the FDP at risk of not reaching the parliamentary threshold.

Meanwhile, the opposition conservatives currently lead with 36 percent in national polls, followed by the right-wing Alternative for Germany (AfD) at 16 percent.

Scholz reiterated a need to “focus on jobs and the economy.”

‘Change Course Quickly’

On Oct. 31, German business organizations voiced concern over the country’s economic trajectory.

Joerg Dittrich, president of the skilled crafts association ZDH, highlighted challenges facing various sectors as Germany grapples with economic downturns and the government’s budgetary indecision.

He identified excessive bureaucracy, energy policy, exploding non-wage labor costs, and a massive need for skilled workers as the main challenges in Germany, and said they require “a holistic and coordinated economic policy.”

“We need to change course quickly; investments need clarity and confidence in a stable course,” said Stephan Hofmeister, president of the liberal professions association BFB. “This requires coordination within the entire federal government.”

AfD

In September, in the state of Brandenburg, Scholz’s SPD narrowly defeated the AfD, receiving 30.9 percent of the vote compared to the AfD’s 29.2 percent.

Although the AfD did not replicate its historic win in neighboring Thuringia, the party’s anti-immigration stance, skepticism of net-zero policies, and opposition to the Russia–Ukraine war continue to resonate with a significant portion of voters.

AfD leaders have called for strict border controls and a reduction in illegal immigrants. The party has also pushed for preserving what it sees as traditional German culture and says that “Islam does not belong to Germany.”

The policies also include opposition to climate action agendas and critiques of European Union integration.

While immigration control is largely under federal jurisdiction, local governments and police can still influence migration through measures such as targeted controls and reduced assistance to asylum seekers.

Under the German electoral and political system, absolute majorities are less common, meaning coalition governments are often formed as a result.

Reuters contributed to this report.
Owen Evans
Owen Evans
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Owen Evans is a UK-based journalist covering a wide range of national stories, with a particular interest in civil liberties and free speech.