Can Germany’s New Coalition Revive Centrism?
(Bloomberg Opinion) -- Germany’s next government brings together an unprecedented partnership — a coalition of center-left Social Democrats, market-liberal Free Democrats, and Greens. Unlikely as this alliance might seem, and stressed as it will be from the outset, it’s a promising venture. If it succeeds, it could point the way to the kind of energized centrism that Germany and much of Europe badly needs. It might even offer one or two lessons to the U.S.
The building of this coalition — quick by German standards — was an achievement in itself. The Social Democrats’ Olaf Scholz, who’ll serve as chancellor, struck compromises with his partners to shape a platform and divide ministerial responsibilities in a way that signals purpose, pragmatism and moderation. The parties have different priorities, and given the challenges Germany faces, there’s a chance the enterprise could quickly collapse. Nonetheless, the prospect of a modernized, energetic center is a hopeful one.
The coalition promises to support workers (including with a higher minimum wage), build more social housing, and protect pensioners’ incomes. It proposes cutting carbon emissions using public investment, faster retirement of coal-fired plants, ambitious adoption of renewables, and more forceful use of carbon pricing. All this, it says, will be done in a way that avoids higher taxes and yet takes fiscal discipline seriously. A constitutional “debt brake” that limits public borrowing — the rule is currently suspended to allow emergency public spending during the pandemic — will be reinstated in 2023.
The tensions in such a program are all too obvious. The Free Democrats’ Christian Lindner is expected to be finance minister; his resistance to higher taxes and unchecked public borrowing will not sit well with his colleagues. Yet the coalition’s plans can be made to cohere. For example, there’s nothing imprudent about borrowing to pay for genuine investment, and the debt-brake rules can be adjusted accordingly. In general, the respective priorities of the three partners — fairness, environmental responsibility and economic liberty — are not only a plausible combination but a necessary one if Germany and other advanced economies are to prosper.
This would be challenging, to be sure, even if the coalition did not face other tests. But the pandemic is surging back in Germany, as elsewhere, and threatens to put the parties at odds over the need for new restrictions. In foreign policy, the coalition might split over the threat of Russian military action in Ukraine, or over how to deal with China. There are tensions, too, over Germany’s ambitions for the European Union. If these pressures don’t break the coalition altogether, they might induce the kind of directionless dithering that came to characterize the latter part of Angela Merkel’s time as chancellor.
But let this be a moment for guarded optimism. Scholz and his partners have this much in common — the recognition that people who disagree about many things can nonetheless compromise and work together toward shared goals. Germany isn’t the only country where that unfashionable concept needs to make a comeback.
Editorials are written by the Bloomberg Opinion editorial board.
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