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February 12, 2019

What the SPD's policy U-turn means for the future of the coalition

The SPD's policy U-turn on labour and welfare reforms is politically more significant than it appears at first. There is now, for the first time since 2005, a clear dividing line between SPD and CDU/CSU in a core area of economic policy. If one looks back at the history of German coalitions, it was always an economic policy issue that presaged the subsequent fall of the government. In 1969, the big theme for the then grand coalition was the devaluation of the D-Mark, which the SPD supported. The break of the SPD/FDP coalition in 1982 was preceded by the FDP's decision to question the fundamental tenets of the German welfare state. A paper written by Otto Graf Lambsdorff, then economics minister, became the casus belli for the subsequent divorce. Gerhard Schröder's red-green coalition ended precisely because of the Hartz IV labour reform - which also turned erstwhile SPD supporters into non-voters. After a gargantuan campaign effort Schröder managed a respectable election result in 2005, but it was not enough for him to form a government. Ever since, Germany politics was underpinned by a consensus over his labour and welfare reforms. 

The SPD yesterday denied that the change of policies would mark an end to the coalition. We also cannot rule out that SPD and CDU/CSU could govern all the way until 2021, but the problem is now that the SPD wants to implement at least some of what it agreed internally - and there is a lot of resistance to that package in the CDU. The future of this coalition will depend on whether the SPD gains a boost in public support as a result of these policies. If it does, the temptation to break the coalition early increases.

We also noted an interesting man-bites-dog story in relation to the SPD's proposals for a rise in the minimum wage from the current €9.19 to €12 an hour. The trade unions have a real problem with this. Why do the unions oppose a big increase in the minimum wage when they were the biggest supporters of the minimum wage before it was introduced in 2015? The problem for them is that such a strong increase would effectively render redundant the minimum-wage commission, in which the unions are prominently represented. And it would make it harder for the unions to achieve wage negotiations successes. The SPD, not the unions, would get the credit for the wage rise for low-income workers. This is a side-show, no doubt, but an interesting one. If the SPD moves to the left, it will overtake the unions on the journey.

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February 12, 2019

Will anti-Europeans unite the people?

How to create a common political space in the EU? This is a long-held dream by pro-Europeans but it looks like political forces ar the extremes are the ones to bring it to life. Unlike in the UK, the anti-EU parties on the continent no longer talk about leaving the EU. They want to change the EU from within, bolstered by trans-national alliances. There are also new civil society movements like the gilets jaunes that do not respond to national party logic within the EU framework. 

Marine Le Pen put her finger on the wound when she pointed out that it is paradoxical that Emmanuel Macron, as a defender of a federalist Europe, is scandalised about an Italian politician coming and talking to French militants. The meeting between Luigi di Maio and the gilets jaunes led Macron to recall his ambassador from Rome. 

The fundamental question is this: is Europe  simply a union of states, governed by the rules of diplomatic savoir-vivre? Or is it the blueprint for a common political space, within which it is legitimate to combine and to confront each other across national borders? Right now it is both at the same time, hence the current dilemma, writes Jean-Dominique Merchet in l'Opinion. The diplomatic order is increasingly threatened by political debates that transgress borders and that manifest in different ways. 

Is the emergence of a common civil society, a common public debate, still a dream? Some already made that step, like former French Socialist PM Manuel Valls who is currently campaigning to become mayor of Barcelona. On Sunday he went to Madrid to protest against the Spanish Socialist government under Pedro Sánchez. Weird, or just an early sign of a paradigm shift?

A lot is at stake in the coming European elections. The most recent ECFR paper on them estimates that about a third of the seats could go to anti-European parties. Their potential to create havoc in the European parliament and shake up national debates is real.

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February 12, 2019

How Tsipras turned EP elections into a two party race

Since the first bailout programme in 2010 the performance of a Greek government was evaluated by how tough it was in the negotiations with the troika and the lenders. This led to repeated grandstanding and climb-downs by the successive governments (four since 2010), and in general to a loss of voters for governing parties.

Today, now that Greece has left the bailout programmes behind, the Syriza government tests its political room of manoeuvre with some social policy packages, which are popular with the voters but not what the institutions had in mind. The battle lines between parties have switched from fights over bailout programmes to the Macedonia name deal - the Prespes agreement. 

According to two polls this new strategy seems to work: the gap between the two large parties, Syriza and New Democracy, is closing to the narrowest-ever or is unchanged, while the two parties together gather 54.5% of the votes up from 43.5% last September. People are in favour of the recent social package put into place by Syriza, and satisfied that the party has let go of the far-right coalition partner Anel. There is still a large majority out there against the name deal, also opposed by New Democracy. This is rather encouraging news for Alexis Tsipras in terms of calling early elections, writes Macropolis.

We find it interesting to note that, whereas the political landscape in countries like France seems to be fragmenting further ahead of the European elections, there seems to be a push in the other direction in Greece.

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