Merkel Courts Government Crisis in Refugee Clash With Allies

(Bloomberg) -- German Chancellor Angela Merkel refused to back down in a clash over migration policy with her Bavarian allies, heightening the risk of a political crisis that could threaten her 13-year hold on power.

Berlin’s government district is abuzz with speculation about who might blink first as Bavaria’s ruling party -- the sister party of Merkel’s Christian Democratic Union -- demands that Germany start turning away some refugees at the border, a measure the chancellor rejects. The dispute is part of a resurgent crisis over refugee policy, fueled by the electoral successes of anti-immigration parties across Europe.

At a caucus meeting Thursday, CDU lawmakers backed her stance that talks with other European countries on curbing illegal immigration should come first, according to a memo from General Secretary Annegret Kramp-Karrenbauer. The CSU, which is part of Merkel’s governing coalition with the Social Democrats, says European solutions haven’t worked and it’s time for Germany to act alone.

Merkel herself made clear that she doesn’t expect her coalition government to end despite the dispute with CSU Interior Minister Horst Seehofer. “I expect that we’ll continue to do this together,” she said Thursday evening after meeting state leaders in Berlin. Germany shouldn’t act unilaterally in protecting its borders and send refugees back, Merkel said, adding that she’ll try to seek bilateral agreements with individual EU states in the next two weeks.

‘Own Dynamic’

“Both sides have a lot to lose if the coalition broke up,” Holger Schmieding, chief economist at Berenberg in London, said by phone. “Of course, such disputes are always dangerous, as they can develop their own dynamic. But a compromise should be possible.”

Lars Klingbeil, general secretary of Merkel’s junior coalition partner, said he had never before witnessed anything like the “open conflict” between the CDU and CSU. The SPD official urged all three ruling parties to focus on enacting what was agreed on in the coalition accord.

“We agreed on a humanitarian refugee policy with clear rules,” Klingbeil said on Deutschlandfunk radio on Friday. “This is the basis on which we will make policy.”

Lame Duck

A defeat for Merkel would undermine her authority with her party bloc and might ultimately render her a lame-duck leader and hasten her demise. At the CDU caucus, her stance received crucial support from former Finance Minister Wolfgang Schaeuble, the party officials said. Schaeuble, now president of the Bundestag, or lower house of parliament, will act as mediator between the CDU and CSU in talks over the weekend.

The CSU, which has criticized Merkel’s open-borders policy since Germany’s refugee crisis began in 2015, said it’s risking a showdown to force a policy shift.

“We have a very serious situation on our hands,” Alexander Dobrindt, the CSU’s floor leader in the federal parliament, told reporters in Berlin Thursday. “Some are calling it a historic situation. We aren’t budging on our position.”

For now, both sides stepped back from the brink. Talks on a possible deal between senior CDU and CSU lawmakers resumed late Thursday and CSU leaders plan to debate strategy on Monday. For her part, Merkel meets Italian Prime Minister Giuseppe Conte on Monday with migration high on the agenda.

Inconclusive Talks

“All of us do want to work together,” Paul Ziemiak, a CDU lawmaker who has previously criticized Merkel’s migration stance as too liberal, told broadcaster NTV. “We all know that we depend on each other.”

Merkel held more than two hours of inconclusive talks on Wednesday with Seehofer, who heads the CSU and wants to turn back asylum seekers who’ve already registered in another EU country. Bavaria’s ruling party, whose support Merkel needs to govern, is raising its voice as it confronts a challenge by the anti-immigration Alternative for Germany in a fall state election.

Seehofer emerged as Merkel’s most prominent domestic critic on migration during the 2015 refugee crisis when more than 1 million people arrived in Germany, most of them via Bavaria. He joined Merkel’s fourth-term cabinet in March in the top federal law-enforcement post.

Austrian Chancellor Sebastian Kurz, who won power last year on an anti-immigration platform, met Seehofer in Berlin on Wednesday and called for an “axis of the willing,” starting with Italy, Austria and Germany, to counter illegal migration.

Merkel, who met Kurz for separate talks, said that could only be part of a broader approach. “The point is a pan-European solution,” she said.

To contact the reporters on this story: Arne Delfs in Berlin at adelfs@bloomberg.net;Birgit Jennen in Berlin at bjennen1@bloomberg.net

To contact the editors responsible for this story: Alan Crawford at acrawford6@bloomberg.net, Iain Rogers, Chris Reiter

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