German federal election 2013: certainties and uncertainties

Tomorrow, 22 September 2013, is an important day in Europe, as German voters choose their new government: what happens in Germany can determine what happens elsewhere, primarily within the eurozone, but also in Europe as a whole and indeed in the wider world.

It is a very weird election, looking from the outside, and looking at the opinion polls, in which many aspects of the outcome are quite certain, but others remain extremely uncertain, including the party combination in the next coalition. Mrs Merkel will in all likelihood remain the chancellor, as the Christian Union parties (CDU & CSU) set to reach about 40% share of the vote nationally. There are few other things that are also quite certain to happen: that the Social Democrats (SPD) will be the second-biggest party in the parliament though clearly behind the Union parties, and that the Greens and the Left will each comfortably clear the 5% share of the vote needed to send members to the parliament. On the other hand, it is quite clear that the Pirates are not going to clear the 5% hurdle, despite succeeding to do so in four state elections. However, beyond that, there are huge uncertainties: the parliamentary arithmetic is complicated – and probably will be determined – by the fate of two parties, the Free Democrats (FDP), the junior partner in the current coalition, and the newly-formed and euro-sceptic Alternative for Germany.

Arithmetically, the grand coalition formed of the Union parties and the SPD or a coalition formed of the Union parties and the Greens would be stable and command a comfortable majority, but those possible coalitions are not what the parties want: the current government of the Union parties and the FDP wants to continue as it is, and the Greens would rather be in a coalition with the SPD. Even if the FDP does manage to clear the 5% hurdle, and Alternative for Germany fails to make the cut, the latest opinion polls suggest a close run thing, whereby the current coalition may just get a very small majority in the parliament, or fail to do so by a very small margin. If the current coalition cannot retain the majority, or the FDP fails to clear the 5% hurdle, or Alternative for Germany does gain above 5% share of the vote, then that will force Mrs Merkel’s hands: arithmetically and realistically it will be the grand coalition or a black-green coalition (so named as the Union parties are denoted by colour black, and the Greens, well, green).

Will the results of this election change Germany’s policy with regard to the euro and the eurozone? Probably not a massive shift, but there may be changes in the tone. And what that tone will be also depends on the fate of the two parties mentioned above, as well as on the junior partner in the coalition.