What Does it Mean?

I commented briefly on the developments concerning the German elections yesterday and today want to offer a final analysis. Keeping it simple….

What does it mean for Germany?

Firstly, the election itself shows that the Germany people are still very divided on the kind of change necessary in their country. Most everyone agrees now some reforms are needed, but that’s about the most honost answer one will hear. What they are and how far reaching is the big question. Most people see the SPD as promoting much softer reforms than the CDU and ideologically being more in line with Germany’s tradition of the “social state” although Schröder’s past reforms also drew considerable criticism. Despite the many hardships ahead, it can at least be said that most Germans have finally come around to realizing change is not only necessary, it’s coming soon.

However, the political gridlock in Germany is unlikely to be conducive to making much change. Although we’re seeing a deal slowly being hammered out, splitting the government, almost right down the middle, that may be progress in terms of building a coalition, but can hardly be seen as building a good government. Given the two parties many differences, whether this election can really force them to work together is questionable. Considering the SPD received three key ministries that are crucial in the upcoming reforms, finance, health and labor, government infighting seems guaranteed.

Expect Germany’s reforms to continue at a snail’s pace, their foreign policy to remain undeveloped and unhelpful and their economy to remain stagnant. Perhaps the most interesting is that as the three smaller parties will be shut out, how much their popularity will rise over the coming years should the SPD/CDU fail to deliver.

What does it mean for Europe?

Germany, as one of the two founding members of the EU and the biggest economy in Europe (at least for the moment), is the heart of the continent. Yet, continuing economic stagnation, rising unemployment, little reform and consistently being on the wrong side of US foreign policy has been a recipe for irrelevance. The European Union will likely remain in its current state of confusion and is unlikely to emerge any sooner as a real international political force. With both France and Germany unable to effectively manage their own domestic affairs and reform failing systems, it’s not likely they’ll be able to contribute much to a functioning supra-government.

While still important, expect Germany to largely remain in neutral allowing countries like England or the newest Eastern European members to pick up the slack. Most interesting will be watching to see whether the focal point of the European Union slowly shifts east if France and Germany remain unable to stop their slide downwards.

What does it mean for the United States?

Despite Merkel’s having been named Chancellor, there are two major obstacles on the path to repairing US-German relations. The first is the German people. Over the past few years, they’ve been increasingly bombarded by anti-American propaganda such as this ridiculous piece of garbage and thus regardless of who’s in the government, he or she will be unable to do much more than exchange political niceties with President Bush. Real policy decisions, if unpopular, will likely be dropped. The second problem is that the SPD, known for their shameless anti-Americanism (using it in both election campaigns), holds the foreign ministry.

In the past, I’ve discussed how Germany only really began to have their own foreign policy since reunfication and how Germany’s participation in international military operations has developed positively for the most part. Nevertheless, Germany’s government will be be dangerously close to paralyzed on many issues due to its grand coalition and the fact that most things remotely controversial will be subject to intense negotiation and compromise. Expect personal relations between Bush and Merkel to be good but not for her to be able to deliver much. Germany will likely remain a non-player on the international stage.