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Merkel Left to Seek SPD Alliance After Greens Drop Out

Chancellor Angela Merkel
The Greens decision to drop out of the running to join Chancellor Angela Merkel’s third-term government after the Sept. 22 elections robs the chancellor of a bargaining chip in her negotiations with the main opposition Social Democrats. Photographer: Johannes Eisele/AFP via Getty Images

Oct. 16 (Bloomberg) -- German Chancellor Angela Merkel was left with the Social Democrats as her sole potential governing partner after the Greens dropped out of coalition talks citing irreconcilable differences over tax policy.

Merkel and her Christian Democratic negotiators ended their meeting with Greens party leaders in the early hours today after failing to identify enough common ground to begin formal coalition negotiations. With the Greens sticking to their demands for tax rises to finance infrastructure and Merkel’s bloc unwilling to drop its rejection of tax increases, the talks broke up with no more meetings planned.

“There was some astonishing movement toward our position” from Merkel, Claudia Roth, the Greens co-leader, said on ZDF television. “But on the specifics of energy, the minimum wage and a citizen’s insurance, there was no movement and that’s why we said it’s no basis for us” to continue talks to form a government, she said.

The Greens’ decision to drop out of the running to join Merkel’s third-term government following the Sept. 22 elections robs the chancellor of a bargaining chip in her negotiations with the main opposition Social Democrats. Merkel’s bloc is due to meet for a third round of discussions with the SPD tomorrow.

Bundestag Session

Merkel has said she wants to pick a party for formal coalition talks before the first post-election session of Germany’s lower house on Oct. 22. Before then, on Oct. 20, the SPD will hold a small congress that may approve or reject negotiations. The SPD has said that it will put any coalition agreement to a ballot of the full party membership.

Greens leaders went into yesterday’s talks casting doubt on the outcome, citing a lack of clarity on Merkel’s renewable-energy goals, her policies on immigration, Europe and on finances.

After about six hours of negotiations, the differences on matters such as energy emerged as “not unbridgeable,” CDU General Secretary Hermann Groehe told reporters. Yet the Greens’ decision to “stick to very massive tax increases as the only way to finance investment amounted to very considerable differences with our philosophy of creating scope for this via economic growth,” he said.

Roth, acknowledging that her party’s finance proposals “were not accepted by the CDU,” said the Greens remained open to more talks if Merkel’s bloc further shifts its position. Her co-leader, Cem Oezdemir, left the door even wider open to another meeting should Merkel’s talks with the SPD break down, saying that he’d “be foolish” to rule out a resumption of the negotiations.

Prickly Negotiations

Both Merkel’s bloc and the Greens expressed surprise at the constructive nature of last night’s meeting, in contrast with the prickly discussions with the SPD the previous day. That may ease the way for Merkel’s party to retain control of the state of Hesse -- which includes Germany’s financial center, Frankfurt -- through a regional alliance with the Greens, breaking an impasse since a regional election held the same day as the federal vote.

“Of course there is still a lot that divides us,” Michael Fuchs, a CDU deputy parliamentary leader, said of the Greens on Deutschlandfunk radio today. “These negotiations have certainly changed the relationship between the two parties.”

To contact the reporters on this story: Alan Crawford at acrawford6@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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