‘What Now For Angela Merkel?’: A Risky Ride for Germany’s Social Capital

These last three months will live long in the annals of German history. Leading the first Christian Democratic Union (CDU) party convention in 55 years with Angela Merkel as its leader, the G-7 leaders,…

'What Now For Angela Merkel?': A Risky Ride for Germany's Social Capital

These last three months will live long in the annals of German history.

Leading the first Christian Democratic Union (CDU) party convention in 55 years with Angela Merkel as its leader, the G-7 leaders, US President Donald Trump, the embattled North Korean leader, and Russian President Vladimir Putin, Germany was the epicenter of global attention.

The convention in Hamburg also served as Merkel’s party’s coronation, and before the ballots were counted, Merkel had already garnered the party leadership’s endorsement.

On top of that, Merkel received the formal endorsement of the two largest opposition parties: The SPD and the Greens. And as in U.S. primaries, support for the much favored, center-right CDU was more about personality than ideology.

But the three-month attention span of the world was a focus on a much larger story: Who would be Merkel’s successor?

The only realistic answer will come at the July parliamentary election. Whoever wins the CDU primary, makes it through the political debate, and enters the Bundestag, will need to unite the CDU, the left-wing SPD, and the Greens as well as build a coalition government.

However, the CDU is still in shock.

The race for the CDU leadership has narrowed from two contenders—Merkel’s former cabinet colleague Sigmar Gabriel and Merkel protégé Annegret Kramp-Karrenbauer—to Gabriel himself and economic expert Friedrich Merz. The weak economy has reduced Merkel’s popularity, as well as her party’s allies in Bavaria, the CSU.

The first two have established their status as the leading candidates for Merkel’s legacy, and the third has been positioning himself as a financial “shock-resistant” candidate.

Both Merz and Kramp-Karrenbauer have touted themselves as strong skeptics of the German-EU agreement for a fiscal transfer union. Both have also focused attention on the dangers of a weakened euro—which would have its upsides but would also hinder German growth.

Merz, the economics minister in Merkel’s previous government, wants the negotiations with the rest of the European Union to aim to make German economic power more internationally competitive.

He strongly criticizes Merkel’s openness to multilateral trade deals, such as the proposed transatlantic agreement with the United States.

Merz wants to put more money in consumers’ pockets by easing financial burdens, red tape, and high taxes, as well as building up Germany’s industry by adopting pro-growth policies.

Kramp-Karrenbauer argues that the CDU needs to reintegrate the SPD and deepen reform by expanding the bond market for pension funds, instead of giving money directly to the CDU’s member institutions. She also promises to reduce business taxes, make everyone provide their electronic health records, and set up a system for randomly auditing businesses’ financial statements.

She has criticized both the planned merger of Deutsche Boerse AG and the London Stock Exchange Group, arguing that a single German stock exchange would not be a viable alternative to the LSE, especially in light of Europe’s digital exchanges, such as the Euronext Group.

Merz can look forward to one potentially important ally—former chancellor Gerhard Schroeder, whose Weimar Agenda his party is trying to return to the political table. Schroeder has long been one of the most popular political leaders in Germany, especially given his role in ending the Second World War.

He can also look forward to at least one unforeseen ally: The bulk of the membership of the Christian Social Union (CSU), the Bavarian sister party of the CDU. CSU members will vote for their next leader during a convention in December.

Merkel has been Chancellor since 2005, the longest of any Chancellor in post-war history. It is now up to her successors to carry on her legacy of prudent fiscal policy, prudent economic policy, and a strong relationship with the EU.

After Germany holds its general election in the fall of 2017, Merkel will then be able to start thinking about her legacy. Can a successor have the charisma and character to match Merkel’s nearly unanimous support as the first female chancellor of her country, as well as her sixteen years of experience at the helm of a world power? Will a “conservative” right turn tarnish Merkel’s legacy, and will Germany’s traditional stance and power shift again as the country searches for a coherent political voice and a bright new generation of leaders?

This column is part of the Echoes of Europe e-series, sponsored

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