Angela Merkel, Germany’s chancellor, addressing a conference in Cologne (Photographer: Krisztian Bocsi/Bloomberg)

Merkel's Coalition Crisis Could Blow Up or Blow Out: 5 Scenarios

(Bloomberg) -- A dispute in Angela Merkel’s coalition over migration policy has swiftly escalated into one of the biggest tests of her chancellorship.

The clash has opened a rift at the heart of the German leader’s own camp, between her Christian Democratic Union and its CSU Bavarian sister party. How the conflict is resolved will determine the chancellor’s fate, possibly as soon as Monday.

Merkel's Coalition Crisis Could Blow Up or Blow Out: 5 Scenarios

Horst Seehofer, Merkel’s interior minister and the leader of Bavaria’s Christian Social Union, wants to force through a plan to send back migrants who have already registered for asylum in other European Union states. Merkel rejects the proposal as offloading the burden on neighboring states, and says it would kill efforts to forge a bloc-wide response to the continent’s struggle with migration.

Merkel's Coalition Crisis Could Blow Up or Blow Out: 5 Scenarios

Bavarian lawmakers are fully behind Seehofer, while Merkel has wrested a majority in the larger CDU group for her position. The standoff is a replay of tensions that have periodically bubbled up between Merkel and Seehofer since the height of the refugee crisis in 2015 and 2016, only this time there is no obvious way out. Following are some potential scenarios:

Compromise

The two parties have managed to eke out a compromise after each previous conflict. Overtures could begin on Monday, when the CSU party executive meets in Munich. Seehofer could give Merkel what she wants: two weeks to forge bilateral accords with countries such as Italy and Greece to return registered asylum seekers.

Merkel could also give ground, as for example the newspaper Die Welt advocates. She could put forward another proposal to assuage the CSU that may yield a compromise. But if she caves in to the Bavarian demands as they stand, it would be an unprecedented loss of authority that would render her a lame duck leader.

No Compromise

In the absence of a face-saving deal, the real clash could come as early as Monday. That’s when Seehofer has indicated he will start to implement his plan at the border. As interior minister, Seehofer has the authority to do so, even in the face of Merkel’s rejection. The only way for the chancellor to forestall a unilateral decision by her minister would be to fire him. Sacking her top Bavarian ally would be a historic first. If it happens, it’s hard to see how the coalition continues.

Even if it doesn’t come to that and Merkel is given until the June 28-29 EU summit to reach bilateral agreements, it may only delayed the clash, since there is no guarantee she can win deals with other other EU states. She has already called the prospect ambitious.

Confidence vote

For a coalition to dissolve, the German constitution says the lower house of parliament, or Bundestag, has to call a vote of confidence. The CDU and CSU, with a combined 246 seats, and the SPD with 153, have a majority of 44 seats in the 709-seat Bundestag. Such a move would be the ultimate measure of support for Merkel as chancellor. Even if she is unable to rely on the CSU, or indeed all of her own party’s votes, on the specific issue of her stand on migration Merkel might be able to attract the support of the Greens, which have 67 seats.

Merkel's Coalition Crisis Could Blow Up or Blow Out: 5 Scenarios

Germany’s Sueddeutsche Zeitung said in an opinion piece on Friday that Merkel should short-circuit the squabbling and put her parliamentary support to the test with a confidence vote. It’s a tactic that her predecessor, Social Democrat Gerhard Schroeder, used to force through military support for the U.S. after the Sept. 11 attacks. He used it again in 2005 amid a party rebellion, and this time lost the confidence motion, forcing new elections.

Merkel resigns

Should the chancellor view her authority as irretrievably compromised, she could throw in the towel. The Bundestag would be forced to elect a new chancellor to replace her, most likely from the CDU. Unless the governing parties agree to continue the coalition under a new leader, Germany’s ninth chancellor since World War II would serve in a caretaker capacity through to a new election.

Split on the right

The CDU and the CSU are sister parties, with a joint parliamentary caucus and electoral program. Think of the CSU as the center-right’s Bavarian chapter -- the CDU operates in all of Germany’s 16 states except Bavaria.

So a breach would be drastic, but not unprecedented. In 1976, CSU chairman Franz-Josef Strauss called off the joint caucus, but the split was short-lived. For the Bavarians, going it alone would theoretically open a path for the CDU to campaign in Bavaria, weakening the CSU’s position.

Merkel's Coalition Crisis Could Blow Up or Blow Out: 5 Scenarios

A hoax tweet that rattled markets on Friday raised exactly that possibility. It presented a fake quote from the CDU state premier of Hesse, Volker Bouffier, as saying his party should prepare to set up a Bavarian chapter for the next national election. Merkel’s chief spokesman, Steffen Seibert, quickly stepped in to say the report was invented. “We should all remain calm,” he said.

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