Germany’s standoff eases as wrangling shifts to coalition

Bloomberg

Germany’s political stalemate showed signs of easing as the Social Democrats started haggling over terms of a renewed coalition with Chancellor Angela Merkel’s conservative bloc rather than outright blocking an alliance between Germany’s two biggest parties.
The possibility of the SPD again joining a Merkel-led government in a “Grand Coalition” has unfolded quickly, with the party opening the door only a week after the chancellor’s talks with the Free Democrats and Greens broke down.
As the back-and-forth with the SPD gets underway, Merkel made it clear that her coalition par-
tner would have to support a balanced budget and broadly pro-business policies. The list of demands from the SPD includes higher pensions and income tax cuts for low earners.

‘STABLE COUNTRY’
Merkel and SPD head Martin Schulz, her defeated election challenger, are due to meet on Thursday at the invitation of German President Frank-Walter Steinmeier, who is urging party leaders to find a way to avoid new elections.
Reaching a deal won’t be quick or easy. The SPD’s convention starting Dec. 7 will be a key event for the talks. Ultimately, a government could be in place at the beginning of 2018 after the parties have the chance to “carefully negotiate terms,” Armin Laschet, head of the CDU in North Rhine-Westphalia, told reporters on Monday in Berlin.
“Then, Germany can get on with the difficult questions” such as Brexit and EU reforms, which the Grand Coalition “can help resolve.”
The SPD, which had rejected a role in government after slumping to its worst election results since World War II in September, sought to gain leverage in the talks with
the condition that any deal over forming a government would
be subject to approval by the
left-leaning party’s members.
“We’ll see what comes out of the talks with the other parties, but you can’t expect the SPD to just jump straight into a grand coalition,” Ralf Stegner, a deputy SPD leader, said in an interview on Monday with ARD television.
“We need to discuss this calmly and then our members will decide whether, and in what form, we take part in government.”
Part of convincing SPD rank and file to accept a coalition deal is by arguing that the alternative could be even worse.
New elections co-uld lead to poorer results for the centrist SPD, while a minority government could mean the party ends up supporting many CDU policies without having much say in the process.
“The first step now is to have serious discussions about a grand coalition,” Jens Spahn, a board
member of Merkel’s Christian Democratic Union and deputy fina-
nce minister, told German public radio on Monday. “This also means, however, that no one builds up
demands that the other party
definitely can’t meet.”
In seeking to ease tensions with the reluctant partner, which underpinned two of Merkel’s three terms, she pointed to Germany’s economic and political success, saying: “We did a good job. We worked well together.” CDU leaders backed a
re-run of a SPD coalition after a meeting in Berlin on Sunday night.