Why Sunday's German elections matter

You can enable subtitles (captions) in the video player

Hello, and welcome to World Weekly from the Financial Times. I'm Gideon Rachman and this week, we're looking at the German elections. This podcast is also a joint production with the Brainstorm podcast which is produced by the Tony Blair Institute for Global Change here in London.

I met Shashank Joshi from the Blair Institute and his colleague Hans Kundnani from the German Marshall Fund, to discuss this weekend's vote in Germany and its wider ramifications. Shashank Joshi introduced the discussion.

Hans, given you've both written on this subject for years, Hans you've written an article recently in the past week for El Pais, the Spanish newspaper, I think we should start by asking, why should we be discussing this, given we all know what's going to happen?

We know who's going to win. So why are we talking about this? Give us a primer of what's happening and are there any potential surprises here?

As you say, it is a foregone conclusion that Angela Merkel will become the Chancellor for a fourth term. It's also clear that the social Democrats will be the second largest party. So insofar as there are questions that remain to be answered by the German election on Sunday, it's really about who's going to come in third.

But that does matter in terms of the coalition formation and in terms of the sort of dynamics of the German political landscape over the next four years. One of the things that's going to be quite interesting is going to be how well exactly the Deutschland alternative for Germany, the euro sceptic and anti-immigrant party, it was only created in 2013,--

And it will get into the Bundestag for the first time on Sunday, how well exactly they do is going to be quite important. Because it could be that they're the third biggest party. In fact, that's what the polls indicate right now. That will be a major change in the political landscape in Germany.

And if there is a grand coalition, which will be the third grand coalition in four electoral periods, quite extraordinary. And the AFD's the third biggest party in Germany. That will mean they are the de facto opposition. That will be a very, very big change actually in the German political landscape.

And then, because Germany's so important for the rest of the EU for the eurozone in particular, the really big question following the election is going to be what a deal between Macron and Merkel might look like. And this is where the junior partner could make a difference, albeit a sort of slight difference rather than a massive difference.

Yeah, I mean I think that Hans is right. But if I could elaborate on some of the points he's making, I was interested to see how you would describe the alternative for Deutschland, because some people just say it's a far right party.

And some German friends of mine now describe it in those terms. And they say well, it started as a kind of Euro sceptic loyalist party who are upset about breaking the eurozone rules, and has now become essentially not just an anti-immigrant party, but a party that in the German context obviously, dabbles in quite dangerous things.

And I notice that Alexander Gaulland, one of the leaders of the party, said recently that Germany should be able to take pride in its history in the Second World War, which caused a number of people to take a sharp intake of breath about that.

And I think if you think that if they get roughly where they are in the polls now, they will have a block, even if they're not the third largest party, of about 80 MPs in the Bundestag. And if they are a radical far right party, that dramatically changes the sort of placid nature of German politics.

Where everyone says look at Germany, it's immune to the populist bog. It's so stable, et cetera. Suddenly. They have equivalent to the Front National-- it will actually, because the French electoral system have a far smaller presence in the French parliament, or if they are equivalent to the British National Party, imagine having a block that size in parliament. That's quite dramatic.

That's true. So on one level, you're completely right. As I said, it changes the German political landscape. On another level though, it makes no difference at all. Because the best of the AFD do, the greater the chances there are of a grand coalition.

And so even if they do have this block in the Bundestag you're describing, the other parties, particularly the Christian Democrats and the social Democrats are going to kind of pull together. And they're not really going to have any influence on policy.

No they aren't, but I think tone matters as well. I think that Germany suddenly feels a bit more turbulent. You have people who are on television all the time highlighting any migrant problems et cetera. And that, I think over time, shifts the tone of debate.

Is there a sense, so this is a French phenomenon too, the centre holds, but at the expense of strengthening of the extremes. And so we're looking here not at short term ramifications, but longer term currents as to what this normalises, what this means for four or five years down the line.

I don't want to be too catastrophist about it, although it's always interesting to spin things out. But as Merkel has said and others have said, Germany's going through a golden period now. Its economy has done it very, very well. But you can see the beginnings of trouble with the car industry, the diesel scandals, worries about electric cars, about Silicon Valley advancing into that territory.

So let's say the economy isn't doing so well In five years time. That probably predictably, the assimilation of over a million immigrants is problematic, is difficult. Then the placid nature of German politics could change.

Gideon's absolutely right that the FDA has changed a bit. It started out as this economic party. It's now become basically an anti-immigrant party. But I would still say that actually it's not a threat to democracy in Germany. In some ways it's good for democracy in Germany I think.

Because it broadens the debate.

Yes, so even the name of the AFD, the alternative Germany, is a response to Merkel's famous statement that there is no alternative. Which I see actually as being an anti-Democratic or post-Democratic kind of impulse. So when the AFD first emerged, I remember, for example Jurgen Habermas saying he welcomes the AFD.

And I think this is right. Because in a sense, I think German democracy has a problem which is the opposite of what we see in the United States, which is very, very polarised situation. There's too much consensus in German politics.

Yeah, I mean I had some sympathy with that argument. Certainly when the AFD were founded, I guess because you know I'm versed in British Euro scepticism. I've thought a lot of what they were saying was kind of sensible. And I didn't really have a problem with it.

However, I'm now a bit more iffy about it. A, because of their anti-immigrants stance. Again, I think you can legitimately disagree about migration, but it's the way they're playing with it. But also because the global context has changed. And frankly, some of this mushy German consensus looks pretty attractive to me compared to Donald Trump.

And also it's quite interesting the way in which populous, whatever you want to call them, far right radicals in Europe, look to Trump. You've seen that with Viktor Orban. You see the links with Nigel Farage and Steve Bannon. Le Pen hailed Trump.

To the extent that the AFD is part of that, I don't think oh whoopee, this makes debate more interesting. It's kind of, I feel much more ambivalence about it now. On the issue of this consensus that you're describing, I think this is a very good moment to then consider the role of the Social Democrats in that consensus.

And there's a widespread sense that there's been a huge Social Democrat fizzle since the hopes of Schulz's exception to the post of leader. The basic question I have is, where's the left gone wrong in Germany?

It's quite interesting I think that Social Democrats have only been in power in Germany in the history of the federal republic, twice. And each time what's happened is that a breakaway party has formed that has undermined the Social Democrats' ability to form the government in future.

So there's a sort of Social Democratic tragedy I think in Germany. The first time this happened was when Willy Brandt and Helmut Schmidt were chancellors in the 70s. And the Greens formed out as a sort of rebellion against the Social Democrats.

So that period, and then during the Schroeder era, Die Linke, which is now polling at nearly 10%, has a complicated history. It's basically a far left party that was formed out of a merger of the former East German Communist Party and a new party that was formed in the western states of Germany that then merged.

And the key figure in this story was Oskar Lafountaine, who was briefly Gerhard Schroeder's finance minister in 1999, 1998, '99 when he first came to power. And then he quit and then years later he formed this new party. And and this is now a sort of far left party that has eaten into the Social Democrats vote to such an extent--

That they now are structurally, virtually incapable of forming a government. And constantly facing this dilemma of do we join a grand coalition as a junior partner, which then destroys their electoral prospects in the next election, but they always worry about refusing to form a government--

Because this would be seen by German voters as being irresponsible. And this is exactly, I think, what's going to happen on Sunday as well.

Yeah no, I mean I think that that dynamic is also obviously part of a wider dilemma for the centre left and the left. You put it in the context of what's happening in Britain and America, the emergence of Jeremy Corbyn, the emergence of Bernie Sanders.

And I think quite likely, idea that the Democrats will move to a more left wing stance away from the centre left. How long can the Social Democrats in Germany resist that trend? Schroeder was associated with labour market reforms that would now be regarded as neoliberal, whatever that term now means.

Schultz, because he's so pro-European, is then associated with an agenda which to the left is a neoliberal agenda, because the European Commission, the single market, all of that. So that I think that they are really in danger of being squeezed. And if you look at what happened the Dutch labour party, it basically almost disappeared in the last election.

Is it also the case that the CE was stalled on the ground in a way that hasn't occurred in other countries?

Yeah, that's often said that the Social Democrats in Germany complained about this. You know, they talk about a social democratisation of the Christian Democrats. But I think this is only half true. Because I think the essence of this Merkel consensus has existed for the last 10 years in Germany. It's a little bit more complicated.

What it's actually is based on, I think, is the SBT has moved to the right on economic policy. Meanwhile, the Christian Democrats have moved to the left on basically social environmental policy. And this brings us back to the point you just made, Gideon, about how the Democrats in the US and central left parties elsewhere probably need to move to the left.

But I think there's a dilemma about how exactly you do that. Do you do that on economic policy or do you do it essentially through social, environmental party or identity policy?

Which I think is a trap for the--

I think so, too.

It was interesting, I saw of all people, Steve Bannon give a speech in Hong Kong last week. And he was quite interesting about some of this, where he said essentially in the west you're seeing two forms of populism emerge. Left populism and right populism. And in an American context, that Sanders and Trump people. And in Britain it's UKIP and Corbyn.

And he said together those two forms of populism are easily over 50% of the electorate. And it's just a question of which one of those emerges as the dominant force. But he also said, to the extent that the left embraces identity politics, my side will win. And I think that was a sort of trap for Hillary Clinton.

But coming back to the German context, it's very different, because obviously given the Nazi past, et cetera, identity politics and emphasising German identity is that much more loaded and dangerous. So maybe Germany won't go that way. But that brings us again, back to the FDA, who are beginning to come into this space.

So I think the real failure of these northern European Central left parties, it's interesting you mentioned the Dutch PDVA. I think their real failure is not to have offered an alternative to Merkel's approach on the euro crisis. i.e. on economic policy.

That, I think, has been the big failure. To have essentially bought into the austerity agenda, partly because that's in the interests of northern European countries like Germany and the Netherlands. Instead of saying no, we're a centre left party and were opposed to this and offering a real--

But I think that they see that as a trap, too. I mean, I remember interviewing Martin Schulz actually when he was still in the European Parliament. And clearly I think intellectually he was far more of a transfer union. But when I pressed him on it, he said oh no.

You know the German Social Democrats are the party that's just going to take money out of his pockets and hand it out all over southern Europe. Because he knew that it was a trap for him.

But it's not as if their current approach is working for them in electoral terms either. Right? So I mean, I don't really see they've got much to lose by taking a much more radical approach on the euro.

I just want to pivot here to foreign policy. And I think the question of redistribution and all of that is a sensible place to start. Is it the case that the viability of real Franco-German cooperation in Europe, is that dependent on the free Democrats being out of power? Can it happen if the free Democrats are in power?

Well, I think if the FDP are at the junior partner, it does make it a little bit more difficult. But I think it has been slightly exaggerated. Because actually, you know, the types of things that Christian Lindner, the leader of the FDP, has said, on the eurozone are not that different from Schibler actually.

So the prospects of Lindner being finance minister, and by the way, it's not clear that he even gets the finance ministry. Even if he does, the way some people talk about this, is as if the current finance minister over the last four years was kind of all sweetness and light.

So I don't think it will make a huge difference, but the other thing is, if you look at the types of things the Macron is asking from the Germans, it increasingly seems to me as if he is going to actually ask Germany for things that Germany has already agreed to, is already in favour of.

In particular, this idea of turning the European stability mechanism into a European Monetary Fund, which the Germans, and in particular, Schibler, already want because they see that as a way to increase control over EU member states' budgets.

I think that in the end, I can't see France being able to give Germany or the commission that kind of control over their national budget. Because it would be such an infringement of national sovereignty. And if you look at the difficulty that Macron is going to have even as elected president of France, getting through social reforms and labour market reforms in particular,--

How do you do that if that's not even your own president doing that, but it's a dictate from the European Commission? It just doesn't seem to me realistic in political terms. So if that's the Germans' ask, they're asking for something that's sort of impossible.

So in a way it's rather depressing to think that this is a repeat of the same story we've seen again and again with these high hopes of our Franco-German reformist axis that will sweep away all the obstacles in its way and fizzles again and again.

But I don't yet have a sense of is how much the scare about Le Pen has changed the mood in Germany, and Brexit. I mean, it might be that the Germans are prepared to break out of this repeating pattern that you, as you point out,--

They've been in for five or six years, and say OK, look, the EU's future really is at stake. Britain's leaving, France almost went far right, we've really got to go for it. And that's certainly the view of the foreign ministry.

I think you're right. There is a shift in the mood in Germany since the French election. I do now hear German officials saying for the first time look, we get that unless Macron succeeds, Le Pen could win in five years time. And you even hear some people saying we think we made mistakes in the past--

With previous centre left, centre right leaders in eurozone countries like Samaras in Greece, like Renzi in Italy. We didn't give them enough. And they were all that stood between those countries and the populists. But, the other thing I hear is officials saying we desperately want Macron to succeed, but we just don't see there's anything we can do to help.

The final word on this, I just want us for all to have a very quick word on, the wider foreign policy question. This tension between Germany's wish to be a sort of anchor of stability in a turbulent seas, and yet nothing to back this up at all.

Once again, we've seen the CD propose an increase in defence spending and Social Democrats vehemently push back, saying they would rather see the money go to diplomacy and conflict resolution at a time when NATO's facing its most serious crisis since its foundation, you could say.

This seems incredible that Germany has this desire to be this anchor, but not the appetite to actually provide the capabilities to provide that stabilising role.

I mean, I'm not sure that they do have the desire when there are all these absurd pieces being written after the election of Trump about Merkel being the new leader of the free world. I mean, Merkel I think rightly said that it's grotesque and absurd.

So certainly on a global level, I don't think Germany does have that desire. I think you're right that there is a certain desire, a European level, and the phrase you used, anchor of stability, is exactly how Germans talk about this. They see themselves in economic terms at least, as an anchor of stability.

I don't think that's the case. Actually what the German economy is doing is not being an anchor of stability at all in Europe.

But even if it was, it supposes that you could provide stability on those grounds alone, rather than--

I mean look, I think that for again, I keep saying this for historical reasons, it's hard for the Germans to put a lot of money into defence and to conceive of themselves as a big military power. And I don't expect that to change, nor do I necessarily want it to, though I can see the argument why you might.

But what I want to push back against is the idea that the Germans aren't playing more of a global role. I mean, Merkel was appropriately modest when she said it was grotesque, et cetera. But as a matter of fact, given what's been happening, Britain's turning inwards. France has a lot to do domestically. America, enough said.

Merkel has become a very important figure. And even before the election of Trump actually, it was striking, if you went and spoke to the people in the German foreign ministry. They were thinking about big global issues that actually were slipping off the agenda in Britain.

Who was taking the lead over Ukraine? It wasn't the UK. It was Germany. On the euro crisis, I know a lot of people criticised them and their role was very controversial, but they were absolutely critical. Nothing happened without Berlin signing off on it. The EU is increasingly run through Berlin rather than through Brussels. They are becoming a big player.

They're also, you know, their leading trade partner now is China, which is really interesting. So they have big interests out in Asia. They're becoming bigger players to some extent, despite themselves. But I think Merkel has been quite responsible in at least getting involved in these big issues and trying to do something about it.

And I think it was worth reminding British listeners that whatever they would like to think, Germany has more troops in Afghanistan than we do. And has a much more substantial role--

And the other thing is you are, again, controversial, but the refugee crisis. Britain had the luxury of saying, well, we're an island, you know, we're not going to think about it. The Germans had to step up and try and deal with it.

That was me discussing this week's German elections with Shashank Joshi and Hans Kundnani from the Blair Institute here in London. That's it for this week. Until next week, goodbye.