Germany's chancellor and leader of the Christian Democratic Union party (CDU) Angela Merkel. Photographer: Michele Tantussi/Bloomberg
An election campaign poster picturing German Chancellor and Christian Democrats (CDU) Chairwoman Angela Merkel. Photographer: Sean Gallup/Getty Images
Angela Merkel, Germany's chancellor. Photographer: Jock Fistick/Bloomberg
German Chancellor Angela Merkel’s party was defeated in a Berlin state election and her coalition ally lost all its seats after turning skepticism over euro-area bailouts into a campaign theme, stoking government infighting over the debt crisis.
The Social Democrats, the main opposition party nationally, extended their 10-year rule in the German capital after beating Merkel’s Christian Democrats into second place in yesterday’s election. Merkel’s Free Democratic coalition partner, known as the liberals, crashed out of a regional assembly for the fifth time this year, while the Pirate Party won its first-ever seats.
The results in Berlin cap a year in which voters punished Merkel’s coalition over its handling of the debt crisis and adds to her pressure as she struggles to balance domestic fatigue over shouldering euro-region rescues with international calls that she do more to stem the contagion. That’s widening fissures in her government as the three-way coalition descends into open conflict over the euro’s future and financial aid for Greece.
“The issue now is how long the liberals hold onto the coalition, whether they break it off ahead of time,” Nils Diederich, a politics professor at Berlin’s Free University, said by phone. “The FDP are being pushed into the corner more and more, so you can’t rule out that they could pull off something like that to gain from it politically.”
Preliminary Results
The Social Democrats took 28.3 percent in Berlin to secure a third term for SPD Mayor Klaus Wowereit, while the Christian Democrats had 23.4 percent, preliminary results showed. The Greens had 17.6 percent, their best-ever result in the city, and the Left 11.7 percent. That means the current SPD-Left coalition cannot resume power and the SPD can choose to govern with either the Greens or the CDU as junior coalition partner.
The result is an acknowledgement of the Merkel government’s woes, said Sigmar Gabriel, SPD leader. His party, which supports euro bonds and a bigger euro rescue fund, has now entered the state government in each of the eight state elections held this year and last.
“The SPD is back,” Gabriel said.
The Pirate Party, which campaigned on open access to technology and Internet freedom, took 8.9 percent to win its first seats in any legislature in Germany’s 16 states. The FDP had 1.8 percent, its worst result in Berlin since World War II.
The “dramatic” loss of support for the FDP shows “euro- skeptic populism has no place” in the political landscape, Cem Oezdemir, the Greens co-leader, said on ZDF.
Euro ‘Duty’
Economy Minister Philipp Roesler, who leads the FDP nationally, put an “orderly default” for Greece on the table last week, further roiling financial markets and earning him rebukes from Merkel’s party. Merkel responded by sharpening her arguments in defense of the euro, saying Germany has a “duty” to preserve the joint currency because it helps exports, makes the country richer and underpins Europe.
“Angela Merkel made clear that the CDU stands true to its pro-European ideals,” Peter Altmaier, the CDU’s chief whip in the federal parliament, said on ZDF. “Some euro-skeptic posters went up in the last days of the campaign and they didn’t make any impact,” he said, without saying to which party he was referring.
The Free Democrats made critical remarks over Germany’s participation in rescues for fellow euro members Greece, Ireland and Portugal in their Berlin campaign. In a radio ad posted on the FDP website, the party said that “as a taxpayer, you shouldn’t pay other countries’ debts. Vote for the FDP.”
Not ‘Posturing’
“Our position on the future of Europe wasn’t posturing for this or any other election,” Christian Lindner, FDP general secretary, told reporters in Berlin in comments broadcast live. “It was about taking on our responsibility for Europe and for our currency, and we will hold firm to that.”
The Free Democrats have struck a more skeptical tone on bailouts as the lower house of parliament, the Bundestag, prepares for a Sept. 29 vote on an overhauled European Financial Stability Facility that includes sovereign bond-buying powers.
The party is likely to hold a members’ vote on their attitude toward the EFSF’s successor from 2013, the European Stability Mechanism, which is due to go the Bundestag later this year or early next year, the Hamburger Abendblatt newspaper cited Lindner as saying in an interview on Sept. 17.
A governing coalition between the Christian Democrats and a “fundamentally euro-skeptic” party would be unthinkable, CDU Finance Minister Wolfgang Schaeuble told Bild am Sonntag in an interview the same day.
‘Credibility Problem’
The euro is a “core issue” for the Free Democrats and the party isn’t about to back down from its stance “because it didn’t hit the right notes with Berlin voters,” Bjoern Saenger, a federal FDP lawmaker and member of the lower house of parliament’s finance committee, said in a telephone interview.
“Markets seek clarity and it must be clear to anyone that the Greek patient is being kept alive artificially,” Saenger said. “The FDP has a credibility problem but giving ground on our position on the crisis would worsen matters. The days when Germany would just reach for the check book to solve a problem in Europe are coming to a close. Somebody needs to say it.”
To contact the reporters on this story: Patrick Donahue in Berlin at at pdonahue1@bloomberg.net; Brian Parkin in Berlin at bparkin@bloomberg.net.
To contact the editor responsible for this story: James Hertling at jhertling@bloomberg.net
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