Germany – a stronghold in turbulent times?

As Germany begins to prepare for elections later this year, MPA candidates Sebastian Luedke and Philip Steinbrecher talked to Joshua Eyre about what they see to be the hot topics for domestic politics and the future of the European Union.


Joshua Eyre: Why is 2017 an important year for German politics? Can you tell us about some of the important dates coming up?

Sebastian Luedke: 2017 is certainly an important year for Germany and Europe. We have the national elections coming up in September, which is an important point in deciding the direction German politics will go. The German election, but also those in other European countries – France or the Netherlands for example – will be closely followed in Brussels, especially in times of uncertainty regarding Cross-Atlantic relations and Brexit.

Thinking about the outcome of the election, it’s important to take a step back and consider what has happened over the last two or three years in Germany. Of course, what has happened is manifold, but there are two things I believe to be of particular importance, which go hand-in-hand. Firstly, I believe the focus of politics, policymaking and public opinion has shifted away from traditional topics such as the labour market, economic performance, social security and the pension system, etc., to focus more heavily on our security policy and controlling immigration. This sentiment has only become stronger with the supposedly increased threat of terror and what we have seen in Europe with the migration crisis, with an unprecedented movement of people from the Middle East into Europe.

JE: Initially in this crisis Germany was very welcoming to refugees. Do you see this as changing now?

SL: This leads to the second major development which is closely related to the above. Public attention and opinion has been shifting this way over time. Germany’s openness has been driven partially by our own history. Traditionally Germans have been more sensitive in this regard. But now, with this increased attention, some people are shifting to the right side of the political spectrum. People have become more worried. Some people have moved away from their initial position of accepting and welcoming these refugees and, if you look at the whole spectrum and if you tie this to political theory and median voter preferences, you could say that the German median voter preference has shifted to the right. What is interesting is that you would expect established political parties to have moved their position to follow to the median voter point as it shifted. For example, the conservative parties like the Christian Democratic Union (CDU) would have shifted their position or at least have engaged in a discussion with the voters who are moving to the right, to move them back towards the parties’ positions. For a surprisingly long time such engagement did not take place. One of the driving factors for this may come from Germany’s sensitive history with right wing parties. The strategy of established German parties appeared to be for a long time to label the voters who have shifted to the right extremists, Nazis, etc., but they have not tried to engage them for too long. So naturally a power vacuum has developed on the right side of the spectrum. Nobody has quickly and thoroughly addressed the concerns of the people on a federal level. Established parties were slow to react to those shifts – the Bavarian Christian Socialist Union (CSU) did more quickly and stronger than the CDU or the SPD. So, this gave space for dedicated right wing parties to emerge and grow in some areas of Germany, which is exactly what has happened in the case of the Alternative for Germany (AfD) party. Things for the established parties have only started moving with very strong public pressure, the elections coming up and even more strongly pushed by the happenings in Cologne or Berlin.

JE: How do you think Germany’s established parties can reengage the electorate?

Philip Steinbrecher: From now until the election the parties of government, and the whole parliament, need to show that they can take back the sovereignty over certain issues. We need to proceed to manage the smooth integration of the refugees who have been accepted as refugees already and further deal with those who have no real claim to asylum in Germany. Politicians need to show they are able and willing to deal with those that might pose a threat to the German public. If the ruling parties are not able to do that in a way people perceive to be successful, the established parties will lose ground to more radical parties like AfD.

SL: I agree with Philip fully. Now parties are realising that they need to build bridges to the voters and to do that they may need to shift their parties to the right or at least enter into a discussion and show they are willing to address the concerns of the people. I see two ways this could happen. Either the established parties – the CDU and the Social Democrats – will have to address these topics and engage with the people more strongly. If they do not do this successfully or it it’s already too late, then the AfD will gain power. AfD have already used this power vacuum and attracted lots of public attention. I do believe they pose a threat unless the other more mainstream parties start addressing the topics that are on people’s minds. Having said that, I am convinced none of the extremist parties will play a role in the government formation and rather will take a share of the opposition seats.

JE: The French conservatives have been moving a little further to the right because they are worried about the National Front picking up some of their vote. Could we see something similar in Germany?

SL: That’s exactly what we see in Germany now. It took some time, but it is happening.

JE: You mentioned a little about the history of Germany and how the emergence of the far-right movement this might be a special case in Europe because of Germany’s history. Much of Europe and the rest of the world looks on Germany as an economic success story, with the perception that because of this economics success there hasn’t been a lot of social strife. Is that a fair reflection?

PS: Partially yes, of course. Most Germans would probably agree. If you look at the spread in society between the poorer and the wealthier groups, and the support people in need receive from the government, Germany is doing comparatively well. But a significant share of Germans look at the current situation and feel left out. They don’t feel they have been treated well by the government in the past few years and now feel that the government is giving benefits to refugees generously. This loss of trust has allowed the far-right AfD to rise, it’s a sign of deep discontent. The situation now has already changed compared to that at the beginning of last summer, when Germany experienced an uncontrolled inflow of refugees. The ruling parties have now enacted significantly stricter legislation regarding the granting of asylum and the possibilities for asylum seekers to stay in Germany after their applications have been rejected. There is more to be done and a need for clear communication about this to the electorate.

SL: I still do think that many Germans’ major concern is a safety one. There is an aspect of social equality, but I don’t believe it is as strong as in other countries. You don’t hear people complaining about foreigners taking work away from Germans.

JE: How do you think the election in September will pan out?

PS: Polls have been fairly inaccurate in what we’re now calling the ‘post-fact era’, with people not being open about their true intentions. I base my analysis on these but we need to take that into consideration. I believe that from a government perspective not that much will change. What we’re seeing is a fragmentation on the right side of the spectrum and a convergence towards centre left policies by the other parties. Smaller parties get more votes and the major parties, the old people’s parties – the Christian Democrats and the Social Democrats – they are losing voters. This might lead to a parliament with up to six factions and a limited choice for coalition formation. The AfD party will most likely enter the Bundestag for the first time, the Green Party and the left party will re-enter. The Liberals, who have been excluded from the Bundestag for the past four years, might return. Looking at potential majorities, this could mean the grand coalition that we’ve had for the past four years would maintain power, with Angela Merkel at the top and Sigma Gabriel from the Social Democrats as the vice chancellor. We’d likely see a pretty strong AfD in opposition, but that would also weaken the opposition because it’s unlikely the other opposition parties would want to negotiate with them. So we’d likely have factions of the Liberals, the greens and the left-wing parties, and a very strong government. I think It’s very likely that we will see the grand coalition again and this is something we, as the young generation, should be worried about.

JE: Why should young people be worried about that?

PS: What we’ve seen over the past four years is that the coalition got their work done. If you look at what they had planned at the beginning of the term and what they had achieved by the end, you can see they managed to get most of it done. But these weren’t policies that were focused on the future, they weren’t the policies that we need to make sure that Germany maintains a strong economic position and will thrive in the future. Many of the policies focused on the social welfare state, things that are beneficial for the older generation at the cost of future generations, something we should be worried about. You know some of the things like the trend towards digitisation, a trend that should have an impact on education policy, should have an impact on the whole working environment, working hours, flexibility of work. In some countries, like Scandinavian nations for instance, they are talking about reducing working hours, about having a guaranteed minimum income for everyone. The process of digitisation will change structures in the economy and the employment market. Germany needs to be thinking seriously about this now, but from my position the grand coalition is too slow in looking at these things. We should be worried about this because it’s shaping the way people think about our democracy. Younger people especially don’t think our politicians listen to them. This is something that we as a society need to work on and I fear that four more years of this grand coalition will lead to a stalemate when it comes to future oriented policies.

JE: Are any other likely coalition options?

PS: Other options could be a left / Green coalition with the Social Democrats, that might technically be possible, but we only had this on a state level so far, with mixed results. Some people would think this would be too much of a left oriented coalition. Also, a Conservative / Green coalition might be possible. I’m sure there are quite a few in the Conservative party that would be open to that idea, but we will see in September how the results are and what’s possible.

SL: If you look at how the things we discussed at the beginning have impacted or will impact the political agenda, it makes it more unlikely that we will see the things that have happened over the last decades. By that I mean Conservatives and Liberals forming coalitions, the Social Democrats with the Greens in 2-party coalitions. I believe this has become much more unlikely, if not impossible, given the developments of the last few years. So, we will either have to go with a grand coalition once again, or we will have to form a never-seen-before three party coalition, and all of those options will obviously be much more complex than a simple two party coalition, which will complicate the process and outcomes of policymaking. I’m not worried it will be as fatal as a hard-right party being part of government, but I believe there will be a decrease in political accountability and the parties of government will struggle to push through their agendas because there will be so much conversation and negotiation required to get two or three parties to align with one another.

JE: So, these coalitions could result in a political stalemate. From a pure political theory standpoint, would you advocate for changing Germany’s political system?

SL: We could spend hours debating this. If you look at the academic literature and discussion on how the German system is set up, it is seen to be well structured and to give the right balance between direct access to candidates and proportional representation.

PS: I think the weaknesses are not weaknesses of our system itself, but rather how we treat it and how we live it. You know democracy is based on finding consensus, on communication, on talking to each other, on solving problems together. And you know there might be a trend that’s coming over from the other side of the Atlantic, from the election in the US. It seems that political debate is moving to social bubbles and networks like Twitter. This is radicalising political discourse. If we’re talking about something needing to change it isn’t the political system, it’s the parameters of the debate. What’s happening at the moment is great though in some ways. Many more people are interested in politics. People are talking about it. It’s not in general a bad thing to see more parties represented in the Bundestag, these might be better at reflecting voter’s preferences. We are responsible for and need to handle with attention when it comes to radical parties. Together we should be trying to keep people more central rather than allowing society to fragment to either side of the spectrum.

SL: To be frank, I don’t think the problem in Germany now is a problem with the electoral system. The problem in Germany is the ignorance of the established parties around the topics that people really care about. They took an easy route and rather than engaging in a proper discussion or dialogue with people moving towards the right, they just labelled them right wing extremists, Nazis, etc. But they should have engaged in a proper discussion and responded to the worries and fears of the people earlier than they did. And if they had, I’m sure we wouldn’t have seen the Alternative for Germany rise as they have done. And interestingly the sister party of the Conservatives in Bavaria, the Christian Social Union, has taken this position much earlier. I don’t entirely agree with what they do but it’s interesting to see how they have done this. They have moved to the right and, as a result, you hardly see the AfD in Bavaria at all. I’m not saying that more parties should have moved to the right, but if they had begun to have these conversations, then we wouldn’t have seen this rise of AfD.

The results of Germany’s election later this year could come as a shock to the established parties if they do not focus on engaging the electorate around issues they care about. (Photo credit: http://www.findingberlin.com/reichstagsgebaeude-bundestag-berlin/)

JE: How do you see German politics effecting the future of the European Union?

SL: We can see some real structural challenges in Europe that need to be addressed if we want to keep the European Union that we know now. With Brexit, as interesting as that decision was, the EU now needs to recognise this as a shake-up and a signal for restructuring rather than a signal for collapse and fear. There are two major pillars that the EU needs to looks at. The first is how its processes work, the way agendas are set and the way decisions are made. The second is the topics the EU focuses on, or at least the topics people perceive that the EU focuses on. With regards to the first, the EU has grown. We have 28 members now, maybe 27 soon and maybe fewer as we move forward further. It seems like the political institutions in the EU haven’t adapted as quickly as the EU has expanded. You see this in the EU trade negotiations with Canada, in which a small region in Belgium could block an entire agreement with a whole block. This just shows that the EU is limited in the way it can act, and I think this is extremely important if Europe wants to remain a significant player in the global economy and world politics, we need to reform these processes and how these decisions are made, otherwise the EU will not have a very bright future. Now how people perceive the topic the EU covers. There are specifics fields of policy where the EU is perceived to be engaged too strongly and there are areas of policy where it is perceived to not be engaged strongly enough. For instance, why does the EU not have a functional common army? These things are very difficult, but why don’t we have a strong, common EU foreign policy? Why don’t we push ourselves further on fiscal integration? And on the other hand, people think the EU is taking care of things that they shouldn’t take care of. You know, these stories about the EU having directives on the angle a banana can be or how curved a cucumber can be. A lot of people are asking why the EU is involved in these things. Let’s not just let it hang on one or two examples, but the perception is that some people in Brussels are sitting there focusing on certain things when they should be focusing on others. They should leave some things to the Bavarians, the Flemish, the Catalans. If the EU doesn’t see Brexit as a signal that it needs to reform and restructure, in ten years we will not have the EU we know now.

PS: The EU has been going through crisis after crisis for almost ten years now. It started in 2008 with the financial crisis and we saw the disaster with Greece and now we have Brexit. I believe that Germany is the country with the greatest interest in having a functioning union. Being at the centre of the EU geographically, we have economic strength due to our export businesses, exporting mostly to our European neighbours. But also with our history of wars and conflicts. We know it’s been peaceful in recent years because of greater European integration. And you know many people have called Germany and indeed Angela Merkel the anchor of stability in the EU, but I believe its everyone’s responsibility to make sure the EU remains viable and that the European project works. Germany can be a driving force in shaping the future of the EU, by tackling the problems that Sebastian has mentioned and by bringing together the member states. We need to work with the member states who want to stay in the union. One of the advantages of the UK referendum is that many people have realised how important the EU is and people are coming out strongly in favour of it, support is rising in most member states. The younger generation is pro-European. You can see this strongly in Germany, because we have felt the advantage of the common currency and of open borders. Germany has the chance to be one of the leaders of Europe in the future. I’m optimistic that if we can address the issues Sebastian mentioned then we will have a strong EU and that Germany will play a leading role in it.

JE: One of the issues in Brexit was that people were concerned that the UK put more into the EU than they were getting out of it. If the EU were to fold this year, German would still be strong clearly, but would it be weaker without the EU?

PS: I have two thoughts on that. Firstly, Germany is the biggest contributor to the EU. Especially when it comes to the loans that were given to Greece and that many people expect never to be paid back. I think some Germans are concerned with that. Some also suffer from the very low interest rate, this is a cost that hits German people because they are traditionally savers, they like to have the money in the bank and they aren’t keen to use it on the markets, to invest in shares, etc., so that’s something especially older Germans think about. But more importantly, we recognise the advantages we get from the EU from an economic perspective. Without the common currency, the German currency would be a lot more expensive and this would hit out export industry. There are things we profit from beyond Schengen. And the peace idea of the European Union is something very much in our minds and something that we can thank the European Union for.

SL: By simply making that calculation, net contributor or net receiver, by disregarding all the complex, adjacent and related topics like currency, trade, free movement and peace; it’s missing the point. Quite frankly, putting one number on a leaflet as some of the British campaigners did, it’s stupid. It doesn’t grasp at all the advantages or disadvantages of the European Union. The sentiment of the individual Europeans cannot be captured in a single number. I believe the sentiment among the majority of Germans is that they understand there is more to it than just a single number. I don’t believe you could be successful with a simple campaign like we saw for Brexit where the financial contribution – a single number – played such a big part.

PS: It’s a question of generations, too. The older generation equates the EU simply to peace, but they also have a bigger anti-European sentiment than the young people because they don’t value the free movement and the common currency as much. They don’t see these as an advantage in the same way as the younger people because they might not travel as much or work in foreign countries. That is why, as I said earlier, the young generation is one of the stronger drivers towards a bigger, more integrated Europe, because we see the profit from being in the union and in shaping it for our future. I believe that’s the way we should be going.

JE: Thanks, guys, this has been enlightening. Before we finish is there anything you would like to add?

PS: From a German perspective, I’m sad to be seeing the Brits leaving us. As Boris Johnson has figured out, it’s very important that we keep a good trade agreement and of course the cultural exchange. We heavily invest in each other’s economies and have hundreds of thousands of jobs attached to these investments. It’s in both of our interests to have a constructive Brexit and to keep trade viable. We’re worried about Theresa May at the moment, with her “hard Brexit” and her stance on the single market…

SL: If we want to make the European project work, and the UK is still part of the European project, just arguably now as an ally instead of a member, a friend, then we must work on this together and everyone must contribute. Most importantly, if you get into a relationship with 27 other countries, sometimes you must compromise. Every relationship requires work, and everyone who wants to make the European project work has to contribute and has to compromise. If we do that then all of us will be better off.


Sebastian Luedke is a consultant at the Boston Consulting Group and MPA candidate at LSE. His focus lies with the advisory of investors, governments and financial institutions. Prior to LSE and BCG, Sebastian worked in investment banking. He completed his Bachelors degree at Cass Business School in London and Bocconi University in Milan. www.linkedin.com/in/sebastian-a-luedke-94866b36  

Philip Steinbrecher is a first year MPA student, originally from Germany. He received an International Business degree from Maastricht University and studied abroad in Hong Kong. Before starting his Masters at LSE, Philip interned in a Public Affairs firm and in the European affairs department of the Confederation of German Employers’ Associations in Berlin.

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