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But the narrow win, with the SPD possibly besting the CDU/CSU by around a single percentage point in the popular vote, underscores the fact that none of the top candidates running to replace Merkel has been super convincing nor credible enough with the electorate during the campaign. This underlines the big "boots to fill" she has left as Europe's longest serving female leader having been chancellor for more than a decade and a half.
Merkel will now become the caretaker chancellor until a new government is formed. With the results so close, the process of building a coalition could take months. Should talks drag on for over three months, until just after mid-December, Merkel would become her country's longest-serving leader, beating Helmut Kohl, the architect of German reunification, who served as chancellor from Oct. 1 1982 until Oct. 27 1998.
While the SPD looks likely to be the largest single party in the German Bundestag, it will need to form what looks likely to be a three-way coalition to win power. In the coming days, all parties will embark on exploratory talks, which have no time limit, and although tradition dictates that the biggest party invites smaller ones for discussions, there is nothing to stop the parties from all holding coalition talks in parallel.
Given the tight election result, much will now depend on the position of the Greens and pro-business FDP which finished in third and fourth place. The Greens have called a party congress for 2 October during which they could decide with whom they will take up exploratory talks, while the FDP has said it has a preference for a coalition with the CDU/CSU and the Greens.
When several parties agree, in principle, that they would like to form an alliance, they must then begin formal coalition negotiations, with various working groups meeting to thrash out policy issues. At the end of these negotiations, the parties decide who will be in charge of which ministry and sign a coalition contract and the parties then nominate who they would like to be chancellor before an official vote in the Bundestag.
At this stage, therefore, the new identity of the governing coalition remains uncertain, and what has been most striking in recent months is voter volatility. Earlier this year, for instance, the Greens sensationally topped national polls for the first time in the country's history.
The reason this was so significant is that the SPD and CDU/CSU have stood as the twin pillars of German politics since the end of the Second World War in a longstanding duopoly of power. But with the CDU/CSU's bearings uncertain in the post-Merkel era, and the SPD not wildly popular either, Germany may be moving from a de facto two-party to a multiparty system with smaller parties which once functioned as subsidiaries of either the SPD or the CDU/CSU now sometimes eclipsing them.
Ultimately, Germany's political flux is not just a domestic issue, but one that also matters deeply for Europe, and indeed the world at large too, not least given that the country's economy is the largest in the Eurozone. Germany is also the continent's most populous country with its influence within the EU likely to grow significantly post-Brexit with the departure of the United Kingdom from the Brussels-based club.
One of the drivers of Germany's political ferment is that the nation's post-war consensus is falling away in multiple areas. This includes history (such as attitudes toward the Second World War), geopolitics (including views toward Russia), the economy (such as attitudes toward the auto industry) and ethics (including views toward refugees), and this is reflected in the fracturing of the political landscape.
Historically, many Germans have been generally content with their post-Cold War lot, seeing themselves as beneficiaries of globalization with unemployment at the last federal election the lowest since the reunification of East and West Germany after the collapse of the Soviet Union. However, this may be changing as shown by the rise of smaller parties with, for instance, the Greens, FDP and the right-wing Alternative for Deutschland all projected to win over 10 per cent of the vote.
Looking forward, the nation's multiparty system future may now mean that politics is generally more unstable and less predictable with even greater challenge each election cycle to establish a governing coalition. So there may be more rotating coalitions with problems this can bring, including potential paralysis and the prospect of the chancellorship becoming weaker in patchwork governments.
This underscores the historical crossroads the nation is now at. While a multiparty system could have some positives, the political danger is a potentially weaker Germany and Europe at a time of growing global geopolitical flux and economic uncertainty in the 2020s.
Andrew Hammond (Andrew.korea@outloot.com) is an associate at LSE IDEAS at the London School of Economics.