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Scholz Named SPD Chancellor Pick in Race to Succeed Merkel

German SPD Leadership Picks Scholz for Chancellery Candidate

German Finance Minister Olaf Scholz secured the backing of the Social Democratic leadership to run for the chancellery in next year’s election, an early move by the struggling party to position itself in the contest to replace Angela Merkel.

The decision Monday was a rare show of unity from the Social Democrats -- the junior partners in Merkel’s ruling coalition. A leadership race sidelined Scholz in 2019 by installing two relative unknowns from the political left to head the party, and it has suffered a string of electoral setbacks in recent years.

Scholz Named SPD Chancellor Pick in Race to Succeed Merkel

In selecting Scholz, the SPD also shrugged off mounting questions around the collapse of Wirecard AG, which have forced him to account for the government’s apparent failure to pursue warnings about the electronic payments company.

The national election is scheduled for the fall of 2021 at the latest. Polls show a steep challenge for the SPD, which is trailing both Merkel’s Christian Democratic Union-led bloc and the Greens. An Aug. 9 Kantar poll had the SPD at 15% support, with Merkel’s group at 38% and the Greens at 18%.

On a personal level, Scholz, who is also the vice chancellor, is the third-most popular politician in Germany, according to a poll for ZDF published at the end of last month. Merkel is in top spot, ahead of Markus Soeder, the premier of Bavaria and head of the CSU, the CDU’s sister-party in the southern state. Soeder has repeatedly said he intends to stay in his current job.

The SPD is targeting “clearly more than 20%” in the election, Scholz said Monday at a news conference, at which he appeared to rule out another coalition with Merkel’s conservative bloc.

“I’m pleased about the nomination and I want to win,” Scholz said, while insisting that the SPD would remain committed to the coalition deal it agreed with the CDU/CSU.

“The campaign doesn’t start today, we still have something to achieve,” he said. “The coronavirus pandemic is still with us.”

Berenberg Chief Economist Holger Schmieding said Scholz’s chances of winning look slim, partly because the SPD is unlikely to finish ahead of the Greens.

“Of course, the popular but not quite folksy Scholz could give the SPD a boost,” Schmieding wrote in a note. “However, history suggests that such a bounce in popularity may not last or go far.”

The SPD has raised the prospect of a governing coalition with Germany’s anti-capitalist Left party, an option that previous party leaders dismissed, rather than reprising the so-called grand coalition with Merkel’s group.

Scholz has agreed that such a coalition is an option, Norbert Walter-Borjans, one of the SPD’s two co-leaders, told Funke media group on Sunday. Scholz did not rule it out Monday, saying it will depend whether the Left and Greens have policies compatible with the SPD’s. Polls suggest a left-wing coalition, even one including the Greens, would fall short of a majority.

Moderate Mayor

Scholz’s candidacy was backed at a meeting Monday by the leadership duo of Walter-Borjans and Saskia Esken, who outflanked the minister in last year’s contest to chair the party.

A moderate former mayor of Hamburg, Scholz has won plaudits for his response to the coronavirus pandemic and was a driving force behind Germany’s massive stimulus program.

The SPD’s nomination of Scholz marks the first concrete bid to replace Merkel, who has said she won’t run for a fifth term. A decision on the candidacy from her bloc has been set back by the pandemic. A CDU congress in December will choose the next party leader, who will be in pole position to run for the chancellorship.

“The SPD decision now puts the spotlight on the CDU/CSU and the Greens, the other two parties who may potentially claim the chancellorship after the 2021 election,” Schmieding said.

The Greens are co-led by Robert Habeck and Annalena Baerbock, with Habeck seen as the more likely chancellor candidate.

©2020 Bloomberg L.P.