World Watch: Germany gets a new chancellor
After three weeks of deadlock, Germany's leading parties this week came up with a formula to share power in the European Union's largest country.
The agreement between the conservative Christian Democratic Union and the left-leaning Social Democratic Party spells the end of a seven-year run for Chancellor Gerhard Schroeder, a Social Democratic leader who clashed with the Bush administration over the Iraq war and championed a stronger Europe.
Schroeder will be replaced by Angela Merkel. She will become Germany's first female leader and also the first from eastern Germany since reunification. Merkel, 51, is a highly disciplined politician who studied physics. Though not known as a colorful politician like Schroeder, she was brought into Helmut Kohl's post-reunification government early in her career and since then has impressed party leaders with her drive and intellect. She calls improving relations with the United States a top goal.
The political deal, which still needs to be finalized, followed a closely fought election contest in September that gave the Christian Democrats only a slight edge over their Social Democratic rivals. With no ready alternatives, both of Germany's leading parties began negotiating the terms of a "grand coalition." For Merkel, though, it comes at a heavy price, with eight of the government's 14 ministries going to the Social Democrats.
The need for tough competitors to become reluctant partners, many analysts fear, will stymie policy breakthroughs on easing Germany's stubborn 11.2 percent unemployment rate, high labor costs, expensive entitlement programs, and problems in education. The deal likely sets the stage for modest reforms to make Europe's biggest economy more competitive. Merkel has advocated raising the value-added tax in order to pay for lower taxes on wages. Some German conservatives had hoped she would play a role like Maggie Thatcher, who as prime minister drove Britain's once sluggish economy in a free-market direction. But the careful balancing act at the heart of the German power sharing and the country's inclination to make big shifts only by consensus suggest otherwise.
Still, the future government could surprise those expecting little from it. As Daniel Hamilton, director of the Center for Transatlantic Relations at the Johns Hopkins School of Advanced International Studies in Washington, notes, a similar power-sharing arrangement in the 1960s produced a balanced budget, an invigorated economy, and the seeds of the policy of Ostpolitik, the West German effort to cultivate ties with then East Germany and soften the hard-line style of Communist leadership there.
In foreign policy, Schroeder's departure is likely to please Bush administration insiders, still angered by his spirited opposition to the Iraq war. Merkel is sure to demonstrate that she is reaching out to Washington, but German foreign policy is unlikely to change much. Even under Schroeder, it is participating in NATO deployments to Afghanistan and training Iraqi officers in Germany. "I don't see any areas where they will strike out on a bold, new course," says Hamilton, a State Department official in the Clinton administration.
Still, the Bush administration will probably see Germany's change of government as a fresh start. "This relationship was not going to get back on track until one of them [Schroeder or President Bush] left," Hamilton says. Now Berlin and Washington will get their chance.