Crisis Averted: Merkel Set For 4th Term After SPD Backs Grand Coalition

All of this has been a show to give Germans (and us) the impression that the two parties do not agree with each other, when in reality both parties are totally controlled by TPTB and now you will (slowly) see that they will continue to roll out the planned agenda.

Crisis Averted: Merkel Set For 4th Term After SPD Backs Grand Coalition:

One of this weekend’s two major geopolitical unknowns was just resolved in favor of more continuity, and another 4 years of Angela Merkel.

On Sunday morning, in a much anticipated referendum, two-thirds of rank-and-file members of Germany’s Social Democratic party voted in favor of a grand coalition with the veteran leader’s conservative, or CDU, bloc, giving Angela Merkel backing for her fourth term as chancellor of Germany, and ending a five month political stalemate in Berlin, which, as the FT recaps, “could help restore Germany’s leadership role in Europe at a time of mounting political challenges, including a looming trade war with the US, rising tension over Brexit and French demands for an overhaul of the eurozone.”

The final result of the SPD referendum, which was announced early on Sunday, saw exactly two-thirds, or 239,604 members, voting in support of a new alliance with the centre-right, while a third, or 123,329 voted against. The turnout was 78%.

Heading into the vote, and after months of debate, SPD leaders struck a coalition deal with Merkel’s CDU and its Bavarian sister party, the CSU, last month. The party then promised to submit the agreement to a vote of its 460,000-strong base, raising the prospect of a last-minute reversal that would have plunged Germany into a political crisis and probably triggered another election.

Concerns were heightened after a special party conference in January, when only 56% of SPD delegates voted to back a coalition with Ms Merkel, highlighting the deep misgivings inside the party.

A rejection of the coalition agreement would have dealt a blow both to Ms Merkel and to the SPD, which had strong reasons to fear another ballot. Recent surveys gave the SPD only 16 per cent of the vote, more than four points below the party’s disastrous showing at last year’s inconclusive general election.

However, it was not meant to be.

“We now have clarity. The SPD will join the next federal government,” said Olaf Scholz, the SPD’s interim leader and the man expected to become Germany’s next finance minister.

Merkel welcomed the SPD decision in a tweet sent out by her party: “I congratulate the SPD for this clear result and look forward to working together for the good of our country,” the chancellor said.

Next, parliament is set to hold a special session to confirm Ms Merkel’s new government on March 14, and with her 4th term now officially greenlit, should Merkel see out a full term, the chancellor will have governed Europe’s biggest economy for 16 years, matching Helmut Kohl’s record as the longest-serving German chancellor.

Putting Merkel’s tenure in context, the Spectator recaps some of the world leaders who have come and gone during her reign:

As the FT further notes, Sunday’s result will also serve as a vote of confidence in the new SPD leadership around Andrea Nahles, the current head of the SPD parliamentary group who is set to take over as party chief next month. Ms Nahles will follow in the footsteps of Martin Schulz, whose one-year tenure was marred by heavy electoral defeats, tactical mis-steps and tension with other top party leaders.

And while the establishment breathed a sigh of relief after today’s result, not everyone was convinced that this is the start of a new Germany. In a note by the New Statesman’s George Eaton, he writes that “the SPD appears to have signed an electoral death warrant. Rather then renewing itself in opposition, it has chosen to again prop up the Christian Democrats. The Left Party and the Alternative for Germany will be further empowered to position themselves as anti-establishment outsiders.”

Indeed, a poll earlier this week showed just how far the once mighty SPD had fallen, with just 17% support, 13 points behind the CDU and just two ahead of the anti-immigrant AfD.

For now, however, the status quo is preserved in Germany, just as the market assumed it would be.

And now, attention shifts to today’s Italian election, where the outcome could have far more significant consequences for Europe, although where the consensus is also for more of the same.

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