Chancellor Angela Merkel continues to be seen by the German electorate as a steady hand well-suited to leading in a time of crisis. The latest opinion polls show the chancellor’s center-right CDU running far ahead of its coalition partner, the center-left SPD, and Merkel’s own approval rating is holding steady at 65 percent. However, with the economy showing signs of faltering, and the outlook clouded by conflict between the EU and Russia, her popularity cannot be taken for granted.

The potential for a seismic shift in sentiment is highlighted by the recent rise of the populist AfD, which originated as a single-issue party opposed to bailouts for indebted euro-zone partners, but has broadened its message to include an anti-immigration plank. The AfD failed to win any seats at last year’s parliamentary elections, but scooped up seven seats in the European Parliament at elections held in late May.

The party also put in a strong showing at state elections in Saxony held in August, at which the CDU won just 39 percent of the vote and failed to win an outright majority in a traditional stronghold.

In The Spotlight

The results of September’s state elections in Brandenburg and Thuringia confirmed the AfD’s solidifying support, with the party winning a double-digit share of the vote in both cases, each time finishing in fourth place behind the CDU, the SPD, and The Left.

Although the AfD’s gains came primarily at the expense of The Left and the SPD, respectively, the very weak showing of the Greens and the FDP highlights the CDU’s limited options for acceptable coalition partners on the right side of the political spectrum.

Of more immediate concern are policy disputes that are sowing tension not only between the CDU and the SPD, but also, in the case of a controversial road-toll plan, between the Christian Democrats and their Bavarian sister party, the CSU. Internal tensions will persist as slowing growth forces officials to make adjustments to fiscal policy. And lacking any viable alternative to the current coalition arrangement, Merkel could be facing tough battles with her SPD counterpart, Sigmar Gabriel, who will face pressure from within his own party to resist a fresh push for austerity.

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The PRS Group
About The Author The PRS Group
The PRS Group is a leading global provider of political and country risk analysis and forecasts, covering 140 countries. Based on proprietary, quantitative risk models, the firm's clientele includes financial institutions, multilateral agencies, and trans-national firms.




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Talkback (1)

  • Guest (WT "Bill" McKibben)

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    The hard line austerity mantra the Germans have imposed on the EU is dragging them further into recession. From the beginning of modern economics -the industrial revolution- to this day there have been many downturns. None have ever been overcome through austerity. Every single one responded to government intervention - spending on infrastructure, education, etc.etc. It doesn't take a genius to understand that when more people are working and making more money, the government takes in more taxes. The current recession would have been over years ago were it not for the austerity nuts in governments across the world. BTW, income inequality hasn't helped. In what universe does it make sense to have the people at the bottom of the economic ladder paying a larger share of their income in taxes than those at the top. We need a reality check!

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