After the German vote, will Mutti let go of Europe’s fiscal whip?
The unbroken drab grey skies and uninterrupted purpose of Berlin commuters might make you think that Angela Merkel’s victory last night will ensure cast-iron continuity for Germany and her position in Europe.
But things may change, albeit incrementally. “Mutti”, as the voters like to call her, has been deprived of the smallest child in her coalition family. The Free Democrats have bitten the dust at the polls, unable to garner enough votes to get into the Bundestag.
This means that the party most wedded to the fiscal whip in the German government has gone. It was the FDP that mounted the barricades over the mere mention of Eurobonds, demanding the gruel of austerity in return for any bailout money to Greece or Portugal.
Angela Merkel broadly agreed with them, but she hails from the leftish, more moderate wing of her party and, having won an election by reassuring Germans that their hard-earned euros were not being wasted on profligate Italians, she may now be in a position to relax the reins.
If, as is widely predicted, she forges a Grand Coalition with the Social Democrats, you can expect Germany to shift towards a more pro-growth policy in Europe. But like most things touched by Frau Merkel, this shift will be incremental rather than radical.
After all, the reason why her junior coalition partners have been ousted is that their support was bled by the eurosceptic Alternative for Germany party. Their support was based on one very poignant question that vexes the vast majority of Germans: why should we be asked to pay for wayward Greeks?
The answer is obvious. Because they buy your washing machines and cars. This is Angela Merkel’s message and she would do well to keep reminding her country of it. “Our economy is based largely on exports in the eurozone. If they are strong, we are strong,” as she put it in her final campaign speech. “If they are weak. We are weak.”
By the way, eurosceptic in Germany means to be sceptical of the euro, the single currency and its tangled web. It does not mean to be sceptical of the EU. This country remains as instinctively pro-European as the UK does not.
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