Andrew Marshall: While we wait for results from Germany...

Andrew Marshall is Managing Director of Cognito Media and a Camden Conservative Councillor

A few historical facts as we wait for results:

• If the AfD makes it into the Bundestag and the FDP survives, this will be the first Bundestag with six parties in it (counting CDU and CSU as one "Fraktion", or political group) since 1953. 

• Since 1949, the SPD has only beat the CDU/SPD on votes thrice:  in 1972 under Willy Brandt, and in 1998 and 2002 under Schroeder (the latter time by only around 6,000 votes nationwide).

• The CDU's 2009 result of 33.8 per cent was its worst result since 1949.  In 1976, Helmut Kohl got 48.6%, but still ended up in opposition to the SPD/FDP coalition.  Germany became an increasingly concentrated three party system in the 60s and 70s, before increasing fragmentation again from the arrival of the Greens in 83.

• The Chancellor has been CDU for 44 years in total since the founding of the Federal Republic, and SPD for only 20 years.

Andrew Marshall: Bundestagswahlen for beginners

Andrew Marshall is Managing Director of Cognito Media and a Camden Conservative Councillor

Many readers of Conservative Home have been following the German election closely, but here are a some points before my live blog for this site this evening that may be of interest:

Coalitions and majorities:  There’s a very strong antipathy to minority governments in Germany, dating back to Weimar experience, and reflected in the German consitution (which for example states that a government can only be replaced by a “constructive vote of no confidence” with a named new Chancellor).  So if Merkel and her liberal FDP partners are just two or three seats short, don’t expect her to form a minority coalition, as a British leader might.  Assume there will be negotiations to form a majority coalition government – there’s never been a minority government in the history of the Federal Republic (in other words a government whose coalition doesn’t have a majority of seats).  There are rumours that the Linke might want to “tolerate” a minority SPD-Green coalition, but given the SPD’s vehement denials, this seems virtually inconceivable this time around (though there are wild rumours some Linke moderate MPs from the former DDR might join the SPD post-election if SPD/Greens were just short).

Angela Merkel lines up with David Cameron to rein in Brussels - and to defeat Germany's new eurosceptic party

By Andrew Gimson
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Angela Merkel is taking emergency action to try to avert the rise of Germany's new eurosceptic party. Allies of the Chancellor last night indicated via Bloomberg News that if elected to a third term on 22 September, she will "curtail the reach of European Union rulemakers" and align herself "with British Prime David Cameron's fight to claw back powers".

Bloomberg cites "officials and lawmakers in Berlin and Brussels" who say Merkel is "likely to air proposals to return some commission powers to national capitals and streamline others" once the German general election on 22 September, in which she is expected to win a third term in office, is "out of the way".

According to Markus Ferber, an MEP from the Chancellor's Bavarian allies, the Christian Social Union, "Merkel's playing a new tune. It's about keeping the UK in the EU by returning some commission powers and that overlaps with Germany's aim to forge a stronger euro area."

All this is good news for Cameron: it makes his European strategy more convincing if he can say that he will be doing it in alliance with Berlin. And it delights the Fresh Start group of British eurosceptic MPs.

Narrow defeat for Merkel's CDU in Lower Saxony points to close federal election

By Tim Montgomerie
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CDU candidate David McAllister played on his Scottish roots

The CDU had been expected to lose control of Lower Saxony for some time and, yesterday, by the narrowest of margins it did lose control of this North West German laender. It turned out to be a much closer contest than expected, however.

The low CDU expectations in these regional elections had been rooted in fears that the CDU's FDP partners were unlikely to cross the minimum 5% threshold and the SPD opposition had been performing competitively in opinion polls. Two things then changed. The popular CDU candidate in Lower Saxony - the half-Scottish David McAllister (read about him here) - urged some of his supporters to lend their votes to his FDP junior coalition partners. This political blood transfusion seemed to work and up to 100,000 Christian Democrat voters ended up tactically in the Free Democrat column - ensuring it more than passed the 5% threshold. The other factor that made the election surprisingly competitive were repeated gaffes from the recently confirmed German-wide leader of the SPD, Peer Steinbrueck. He has made repeated gaffes since becoming his party's candidate for Chancellor - including a foot-in-mouth suggestion that he'd like a bigger salary if he was elected to Germany's top job.

For the first time in a decade Lower Saxony is now expected to be governed by an SPD-Green coalition with 69 seats to the outgoing CDU-FDP coalition's 68 seats.

Andrew Marshall: Listen to Mutti. What Cameron can learn from Merkel and what the Conservatives can learn from the CDU.

Andrew Marshall is Managing Director of Cognito PR and Marketing, and a Conservative councillor in Camden. He writes here in a personal capacity. Follow Andrew on Twitter.

The latest polls in Germany put Merkel’s CDU (Christian Democratic Union) on 40-41%, up from 34% at the last election and more than 10% ahead of the opposition SPD.  Merkel appears in a commanding position ahead of September’s elections – and even if her new post-election junior partner is the SPD or the Greens, the policy shift will be limited.  Not bad for a party that’s been in government since 2005.  Not bad for a government that’s had to take unpopular decisions to help tackle the Eurozone crisis.  Indeed arguably the CDU, which has governed Germany for 44 of the last 63 years, is Europe’s most successful political party of the last half century.

So you might think that influential people in the Conservative Party (Lynton Crosby?) would be trying to work out whether there are any lessons to learn from the CDU.  If so, it’s being well hidden.  Many writing on this site regularly decry the CDU as part of the “declining European model”.  And for many of those who comment regularly on ConHome (the kind who use lots of capital letters and write about the “EUSSR”), Merkel is simply the enemy.  Kohl, Merkel, Delors, Chirac, Rajoy  – who cares what party they’re in,they’re all continental politicans trying to subjegate us.

Of course political culture and party dynamics are different in every country, and we should be wary of simplistic comparisons.  After all, no British politician would dare to propose the degree of decentralised market involvement we see in German healthcare.

Is Europe voting against austerity or is Europe voting against tax rises?

By Tim Montgomerie
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Another election result and another bad result for the incumbent.

Angela Merkel's CDU won just 25% of the vote in the huge laender of North Rhine Westphalia.

The Wall Street Journal warns it readers not to get excited about the result. Before 2005 NRW was a stronghold of the opposition SPD, it says. It also notes that, unlike in France, the big German parties are largely agreed about the need for some sort of austerity (although they're not agreed on pace and scale).

The results across Europe are largely being read as votes against austerity. I've also argued that they are votes against the €urozone. But one under-discussed factor might be that they are also votes against higher taxes. New York Times commentator David Brooks made this point within his regular slot for US National Public Radio.

I'm not saying that voters aren't also protesting against spending cuts but we know in Britain that it's been tax rises (on VAT, pasties, charities, pensioners) that have caused Cameron and Osborne their biggest political problems. Deeper cuts in spending aren't going to be popular (think of a one billion spending cut as equivalent to taking £1,000 off one million people) but one way in which centre right parties might protect themselves from the anti-incumbency mood is to limit the tax rises and focus on trimming the EU's bloated public sectors. As John Redwood has argued, we are at the tax saturation point and voters have had enough.

Andrew Marshall: Why the CDU's EU policy "is not only a rational matter, but an emotional commitment"

Andrew Marshall is a director of communications consultancy Fishburn Hedges and a Conservative Party activist

On December 16 a referendum will take place in Germany on its participation in the European Stability Mechanism - a referendum, that is, for the 65,000 members of the liberal Free Democrats (FDP).  It’s been triggered by a backbencher, and the party leadership is now working overtime to ensure that the proposal that the FDP should oppose the ESM doesn’t pass, not least since this would throw into question the FDP’s role in the governing coalition.

This is, needless to say, just one of the pressures on Angela Merkel.  She’s managing the crisis day by day like any leader: indeed, ever since she became Chancellor, the German media has complained about her lack of strategy. Behind all that, though, the electoral backdrop is stark: the centre-right coalition is unlikely to be re-elected in 2013. The CDU/CSU is at around 32% in the polls, down just a touch on its last performance, but the FDP has collapsed from its record 14.6% in 2009 to around 4%, both because of its inability to deliver on overblown tax promises, and because of the unpopularity of its former leader Westerwelle (still Foreign Minister).

Even if the FDP gets back above 5% and is thus in the next parliament, the “black-yellow” coalition of CDU/CSU/FDP looks well behind the alternative centre-left coalition of Social Democrats, now back up to 30-31%, and the Greens, off their poll highs but still on around 17%.

So Germany will either get a SPD-Green government (as under Schröder) or – if as likely the left party has a blocking position in the Bundestag – we could be back to a CDU-SPD "grand coalition", as in 2005-9 (with the larger party providing the chancellor).  Indeed, the coalition already last year lost its majority in the not-unimportant upper house (the Bundesrat), due to losses in the staggered cycle of Länder elections.  

This is the context in which Merkel has been repositioning the CDU.  Ever since too market-orientated a stance lost her an expected majority with the liberals in 2005, she’s been rowing back to the centre. Recently that pace has accelerated: consider the nuclear power U-turn, the end of conscription, school reform ideas, and possible quotas for women on corporate boards.  Most recently, Merkel has changed her position on the minimum wage - all of which has led to commentator chatter of a “social-democratisation” of the CDU (though there is going to be a mini tax cut, not least to help stabilise the FDP).

While many of these new policies are not uncontroversial in her party, they are not necessarily unwelcome in an environment where the German economy has rebounded, but where the electorate is pretty sceptical about global capitalism. Merkel needs new coalition options for 2013 - or possibly before, if the Free Democrats implode and leave government, though it’s still difficult to construct that scenario, and the German constitution makes early elections difficult.  But unless SPD-Greens can secure an overall majority, which is possible but not easy, the CDU, with stable polls and a centrist position, could be well placed to look for new coalition partners – with the SPD in a grand coalition, or even possibly with the Greens. Merkel would probably still prefer to govern with the FDP next time, but she’s a realist.

On the Euro, Merkel is playing a fairly hard game, both out of personal conviction and because of the dynamics of German politics - though keeping some room for manoeuvre.  The fear of Weimar-style inflation is mentioned more by British columnists than the German media, but some parliamentarians (and the public) are clearly concerned about limitless bailout costs, even though it’s broadly recognised that Germany’s economic fate is inexorably linked to its neighbours, not least in preventing an over-valuation of the currency. While there are more populist anti-Euro sentiments in German politics now, they are more institutionally weak and much less ideologically eurosceptic than the UK’s "right wing press” may sometimes think. “DM nostalgia” is just that.  There is speculation about the scope for a new party to oppose the Euro bailout - but so far it’s just talk, with no credible leaders in the wings.

The respected former businessman Hans-Olaf Henkel’s latest book “Save our money – how the Euro fraud threatens our prosperity” argues for two separate currency zones, but he’s said categorically that he doesn’t want to found a party.  Any taint of the extreme right would be fatal to any anti-Euro initiative.  Some Free Democrats are tempted to fill the anti-Euro bailout space, but whatever the result of the membership vote, the chances are that the FDP’s pro-European leadership will keep any such shift rather nuanced.  It’s ironic that the pro-market FDP, which might be theoretically best placed to capitalise on anti-bailout sentiment, is extremely unpopular – it tested out an opportunistic anti-bailout campaign in the recent Berlin city elections and was rewarded with precisely 1.8% of the vote. 

The CDU parliamentary rebellion on the enlarged EFSF in late September did strain the party, but the rebel numbers were kept well down and the rebels are hardly eurosceptics - rather simply those appalled by the lack of budgetary oversight over the huge sums involved and the lack of clarity about the end game. What some of them wanted was more EU control over member state deficits, given the contribution Germany was making.  

Most importantly, in that vote Merkel got the opposition Social Democrats and the Greens – her potential future coalition partners - onside.  None of the potential "chancellor candidates" the Social Democrats might choose fundamentally oppose Merkel’s European policy (indeed some are rather more "pro-European").  Within the CDU, Merkel’s main rivals have left the scene, there is no top-level policy challenge to her on Europe, and one of the most promising long-term successors, Ursula von der Leyen, has called explicitly for a “United States of Europe”.

So what does the CDU now want? Its 24th party conference starts today in Leipzig. Unlike the Conservative Party, the CDU’s roots are as a mass membership party in which conferences do matter and have real votes, even if there is a strong drive for consensus and constant criticism that it has become simply a “Chancellor party”. The party’s executive board, on which Merkel and other leading figures sit, is bringing to the conference a 24-page position paper on Europe. Since the CDU is the most important political party in Europe, this is worth reading.  Here are a few extracts (my translation):

“The CDU is the Europe party of Germany.  For us our commitment to Europe is not only a rational matter, but an emotional commitment…..The political and economic advantages for Germany far outweigh the costs of EU membership…..our membership of the Eurozone alone in the last two years has brought extra growth of at least 2% and thus at least €50 billion”.

“We want to complete the economic and currency union and make the EU into a strong political union…The Euro is more than a currency, it is a major communal undertaking and essential to a good future for Europe.”

“We will resist the over-simplifiers and populists and consistently highlight those successes we have already achieved in Europe.” 

“The CDU is convinced that through more market-orientated measures and less bureaucracy and state dirigisme, a new impetus for prosperity in Europe can be made possible.”

“The stability and growth pact must, through enhanced automatic sanctions mechanisms,..become a credible instrument of reliable budgetary policy in Europe, therefore we want this integrated in the treaties to create a debt brake at a European level.”

“We want the political union to have a democratic two-chamber system, consisting of the European Parliament as the directly elected chamber of the people, and the council of ministers as representatives of the member states…The political union needs to have a face, so in future the President of the European Commission should be directly elected by all citizens of the Union.”

“More integration is not an end in itself, but the key to a strong position for Europe in the world. We want to breathe new life into the principles of subsidiarity – petty rules by the EU Commission endanger the acceptance of Europe by our citizens.  They want more Europe where it helps them, not a Europe organising all details of their lives.”

After considering defence and energy and the need for the Commission to both deregulate where possible but also have more powers to enforce application of existing European legislation, the document then sums up:

“The consequence is that in key policy fields we need more Europe, and so the necessary treaty changes represent a major challenge.  The EU must be kept as a unit, but member states who are able and willing to go further, such as with the Euro or Schengen, should be able to do so.  Other states should have the option to join later, but there should not be, in policy or organisational terms, any delinking from the EU – competing European architecture and unclear responsibilities would endanger the political union.”

“The CDU accepts its responsibilities – with our Christian vision of humanity we have a compass which allows us to take up this challenge as an opportunity.  We are ready to undertake an active role in the deepening of the unity of Europe”.  

There’s a paragraph on France in this document, and a mention or two of Poland, but nothing on Britain.  For the CDU, Britain has made itself marginal. The CDU always invested much more in the party-to-party relationship than we did in return. The EPP decision (and Europe-wide parties matter much more to the CDU than we might think) was simply seen as marking the culmination of the CDU’s long process of disenchantment with the UK and the Conservative Party on Europe.

It’s easy to write off such a paper as mere words.  But it reflects the CDU’s deeply-held convictions and Merkel’s judgement about what needs to be done in the current crisis in the German national interest and the interests of Europe.  If we’re all re-negotiators now, those in the Conservative Party most ardent for treaty change would do well to pay some attention to the debate in Leipzig next week.

Will the Liberal Democrats follow Germany's example and abandon nuclear power?

By Tim Montgomerie
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Overnight we had confirmation that Angela Merkel's CDU/FDP coalition has abandoned plans to extend the life of Germany's ageing nuclear reactors until 2036. By 2022 Germany will become a nuclear-free power and, in preparation, reports Reuters, Merkel will "present five or six bills in Cabinet on June 6, including a revamp of feed-in-tariffs for solar, wind and biomass power, new building insulation targets and plans to build new “smart” power grids."

Mrs Merkel's u-turn follows strong performances by the German Greens in regional elections. On the back of opposition to nuclear energy the Greens topped the poll in Baden-Württemberg, in March, and overtook Merkel's CDU party in elections in Bremen last week.

One week ago Switzerland also said it would not renew its nuclear power stations, but the phase out wouldn't be complete until 2034.

I wonder if the Liberal Democrats will look to Germany and Switzerland for inspiration? The SNP's opposition to nuclear power stations was one of the under-discussed factors that helped it defeat the pro-nuclear Scottish Labour Party. With UK-wide opinion polls finding a plurality of voters AGAINST nuclear power (by 48% to 40%) the issue could provide the next tension within the Britain's Coalition. The current Lib Dem position is that they'll support nuclear power as long as it doesn't receive public subsidy - while, it should be said, supporting huge subsidies for renewable ernegies.

Meanwhile, reports WorldFinancier, India, China and other emerging economies are continuing with their nuclear power programmes. Eastern Europe, on the whole, also remains pro-nuclear because of its determination to be independent of Russia.

German FDP leader's decision to stay in government but resign as party boss may be model for Clegg

Tim Montgomerie

Nick Clegg will be watching the fortunes of Germany's Free Democratic Party (FDP) with interest. The junior coalition partner in Angela Merkel's government was badly defeated in the recent Baden-Württemberg election. Guido Westervelle has decided to end his ten year leadership of the FDP but continue as Germany's Foreign Secretary. He hopes that this will ensure the FDP retains its role in government but that, under a new leader, his party can reverse a slump in the opinion polls (from 15% to just 5%). This resign-only-as-party-leader strategy is one I think Nick Clegg might need to take, but only towards the end of this parliament.

Part of the reason for the decline of the FDP has been Westervelle's failure to convince Merkel to prioritise supply-side tax cuts over and above her cautious fiscal conservatism. Lower taxes had been such a defining selling point for the FDP that a failure to deliver them has hurt Westervelle's partly very badly. The FDP has also been the country's most pro-nuclear party in a country that has reacted very strongly to events at the Fukushima plant in Japan.

If the FDP doesn't recover and win the 5% plus that is necessary to win any seats in Germany's system of proportional representation, the CDU will be left without a natural partner in government. This has led some (including the FT (£)) to speculate that an alliance with the Greens might one day be necessary. A Green/ CDU alliance was formed in Hamburg but ended badly. Mrs Merkel has dismissed the possibility as a "fantasy" and it is certainly hard to reconcile the social liberalism of the Greens with the social conservatism of the CDU's Bavarian arm (the CSU). Nonetheless there is an emerging faction within the Greens that emphasises budgetary responsibility that might make it possible.

In terms of the FDP's future, the Süddeutsche Zeitung (quoted by Der Spiegel) wishes that it could go back to its centrist role of moderating both of Germany's big two parties:

"Despite all its failings, the FDP used to have the reputation as a wise, clever party. That attracted voters. It no longer has this pulling power. In its heyday, the FDP was a fertile opposition within government: in the conservative governments of Konrad Adenauer and Ludwig Erhard, the FDP left its mark as a party of democratic justice, and in the center-left governments of Willy Brandt and Helmut Schmidt, it was the guardian of market economics. The FDP was a guarantor of continuity in the changing governments of the republic."

It is now the ambition of the 'realists' within the Green Party to be Germany's balance-of-power party.

Anxiety over nuclear power contributes to defeat for Angela Merkel in state held by CDU for sixty years

Tim Montgomerie

Extreme volatility is the big new thing in politics. Yesterday the Australian Labor party wasn't just beaten in New South Wales but "massacred". It was, wrote Jason Groves for ConHome, "the most devastating defeat in Australian political history". 

Last month Angela Merkel's CDU suffered a heavy defeat in Hamburg. Today, according to exit polls, her party is to lose control of the state of Baden-Württemberg - a state that the CDU has held for 58 years.

The Greens - exploiting fears about nuclear power in the wake of the Japanese tsunami - may top the poll, giving them the senior role in a partnership with the SPD. 200,000 anti-nuclear protestors marched in four German cities yesterday, helping to put the issue centre stage in today's voting.

Mrs Merkel had declared a moratorium on extending the life of existing nuclear plants. This announcement was seen by many as opportunistic, however, and hasn't saved her party in BW.

Although it's very unlikely that Mrs Merkel will face a leadership challenge the leader of her junior coalition partner, the FDP's Guido Westervelle may be toppled. Merkel faces no obvious rivals but her "risk-averse and pragmatic" leadership style is being criticised by members of her party. The Wall Street Journal (£) reports:

"Besides the nuclear question,and the euro zone's debt crisis, Ms. Merkel has also taken flak across the political spectrum for her handling of the euro-zone debt crisis—in which her decisions to bail out near-bankrupt Greece and to pump rising amounts of taxpayer money into a safety net for other countries proved controversial—and on the Libyan conflict, where she is accused of failing to back Germany's Western allies."

The results from Germany will encourage Alex Salmond to put the nuclear issue at the heart of his last-ditch campaign to save the SNP government in Holyrood. Trailing in most opinion surveys, the Scottish First Minister sees an opportunity in Scottish Labour's support for the nuclear industry. Herald Scotland reports Mr Salmond attacking Labour's "obsession" with nuclear power. “Different visions of the energy future of Scotland will clearly be a significant issue in the election campaign,” he promised.