Has Germany's kingmaker FDP come out on top in coalition?

Germany's new incoming coalition government, comprising the center-left Social Democrats (SPD), environmentalist Greens, and the neoliberal Free Democrats (FDP), has taken shape after two months of intense negotiations. Last week, the "traffic light coalition" — shorthand for the three parties' colors — announced its proposed governing deal and priorities for the incoming administration. Now all that is missing is a grassroots-level approval.

So is the FDP really the big winner in the tug-of-war over ministries? And what about the substantive details of the coalition agreement? The most important post, the Chancellery, will of course be taken over by the election winner — in this case, the SPD's chancellor candidate, Olaf Scholz. His party will hold a total of six ministries, compared to the Greens' five and the FDP's four. This ratio roughly corresponds to the result in the Bundestag election: SPD 25.7%, Greens 14.8%, and FDP 11.5%.

Future finance minister and FDP party leader Christian Lindner has said he is "satisfied" with the outcome of the coalition negotiations. But his famous flexibility will now likely be put to the test.

The first pressing issue for the incoming government will be to curb the COVID-19 pandemic. The neoliberal FDP has long positioned itself against shutting down businesses and is fundamentally opposed to restrictions on the free movement of individuals. With infection numbers spiraling out of control and a supreme court ruling that backs far-reaching emergency measures, FDP head Lindner may well have to eat his words.

The precise allocation of ministerial departments is telling. In addition to finance, the neoliberals will be responsible for the ministries of justice, transport, and education. It is a fitting mix for a political force that has always been particularly committed to individual freedoms and has campaigned for Germany to have the "world's best" education. The party has also long lobbied for increased digitization in various sectors — and indeed it will now be responsible for a host of digital issues in the Ministry of Transport and Digital Infrastructure, for example.

The FDP traditionally caters to its high-income earning electorate by promoting the car industry and opposing speed limits on Germany's freeways to allow Mercedes Benz and BMW drivers to enjoy the freedom of speeding on Germany's Autobahns. Therefore it raised some eyebrows when FDP party secretary Volker Wissing was named transport minister, which was much coveted by the Green's leftist environmentalist wing.

Over the past decades, the FDP has governed on the federal level both with the center-right Christian Democrats and also with the center-left Social Democrats. In both combinations, it often provided the country's foreign minister. But this time around the party did not snag the ministry with its classic international profile — a noticeable omission. Instead, Germany's next chief diplomat is likely to be Annalena Baerbock, the Green's co-leader and the party's failed chancellor candidate. 

In some sense, however, the Ministry of Finance, too, holds considerable international weight, given that it will handle issues such as the regulation of financial markets and the introduction of a global minimum tax — the latter of which Germany's future chancellor, Olaf Scholz, was involved as finance minister.

From this perspective, the FDP will also be visible and influential outside of Germany. But this is especially true for the Greens, because they will not only take over the Foreign Office in the emerging traffic light coalition but also the Ministry of Economics, which will be responsible for climate protection in the future.

What about the policies in the coalition deal? Lindner stated early in the election campaign that there would be "no tax increases with the FDP." The SPD and Greens, on the other hand, want the rich to pay more. So did the FDP prevail? Yes and no — the neoliberals would have liked to see tax cuts but they were unrealistic in view of the billions in debt taken on during the coronavirus pandemic.

The FDP — which is generally skeptical of mandating a minimum wage — also had to give in to the wishes of the SPD and the Greens on low-wage worker compensation. The statutory lower-wage limit is planned to increase from €9.60 ($10.82) to €12, though there could be legal wrangling on the specifics.

It was 2013 when the FDP last served in a federal government. In the intervening eight years, much has changed — but at first glance, the FDP appears to be the most satisfied with a return to a ruling position and its ministerial gains.

During last week’s presentation of the coalition agreement, Lindner spoke of the coalition's joint task to modernize Germany. "We are forming a coalition in which the three partners are not limited by what was incompatible in their programs." Indeed, the search for compromise resulted in the motto "dare more progress" — but it remains to be seen how much cooperation and progress will occur in this coalition of surprising bedfellows.

This article has been translated from German.

Edited by: Jon Shelton

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