Chancellor Olaf Scholz’s Social Democratic Party (SPD) eked out a slim victory in Brandenburg’s state election, fending off the far-right Alternative for Germany (AfD). Final results show the SPD at 30.9% versus the AfD’s 29.2%.
While this outcome spares Scholz from immediate political peril, it does little to quell internal party dissent or speculation about his future. The SPD’s success in Brandenburg, a stronghold since German reunification, stemmed more from anti-AfD sentiment than support for Scholz’s struggling federal coalition.
This election highlighted several important developments in German politics:
The good news for Chancellor Scholz ended with keeping the AfD at bay. The long-serving SPD state premier, Dietmar Woidke, gained momentum in the polls and retained office only after effectively disassociating himself from the national party and Mr Scholz. If there’s a lesson to be drawn for Scholz, it’s an uncomfortable one: it may only be without him that the SPD can win elections again.
While the Greens scored a mere 4% in the Brandenburg election, the liberal FDP almost disappeared from the political landscape, falling short of reaching the 1% of preferences. A leitmotiv that we witnessed also in Thuringia and Saxony.
A dismal September for the coalition government that risks holing it below the waterline: the upshot of these humiliations is likely to be a dysfunctional, fractured coalition at war with itself ahead of next year’s political test. Without an internal party push to replace him, which remains possible, Mr Scholz will quickly become a convenient punchbag and scapegoat.
Despite retaining Brandenburg, Scholz faces mounting pressure. Some speculate Defence Minister Boris Pistorius could replace him as the SPD’s chancellor candidate. Meanwhile, Germany’s auto industry teeters on the brink of crisis after the government axed purchasing subsidies last year on electric cars, with Economy Minister Robert Habeck struggling to find solutions.
This complicated scenario has allowed the AfD to capitalise on issues like immigration, setting the tone for political discourse. Alarmingly, in Brandenburg – where intelligence agencies have flagged the local AfD branch as especially radical – the party secured the top spot among all voters under 60. While Scholz’s party narrowly clinched a win in last Sunday’s regional election, which served as an informal gauge of his government’s standing, it rings hollow. Following a turbulent month, this victory seems more like a defeat in disguise.
Les finances à moi
In France, the new prime minister, former Brexit negotiator Michel Barnier, presented his new government team last Saturday, which marks a shift to the right in the country. The ten ministers of Ensemble pour la République (President Macron’s party) and the six of the centre-right Républicains form the core of the new government, despite the coalition linked to Emmanuel Macron and the Gaullist party having been defeated in the early legislative elections in early July.
The 33-year-old Antoine Armand will take over the post of Finance Minister in place of Bruno Le Maire in a situation of public finances drift that worries Brussels. Interestingly, the ministerial responsibility for the budget has been taken away from France’s powerful economy and finance ministry – the Bercy – and given to a budget minister, Laurent Saint Martin. Not just a technical change: Michel Barnier knows that France’s budget challenges will make or break him and is willing to call the shots from the beginning.
The centrist Jean-Noël Barrot will be the new Foreign Minister. Benjamin Haddad will support him as Minister for European Affairs. Sébastien Lecornu of Defense is the only minister reconfirmed in Gabriel Attal’s government. Bruno Retailleau of the Républicains, a promoter of the hard line on security and immigration, is the new Interior Minister. Earlier this week, he declared that France wants to reduce immigration “by any means”. Asked if Paris wants to follow Berlin and implement new border checks, Retailleau said: “We’ll see how far we can go.” Any debate around changing Schengen rules — which allow some border checks, but only temporarily — is likely to be explosive in the current political scenario. Agnès Pannier-Runacher returns to government, taking up her post as Minister of Energy and Ecological Transition.
It took two and a half months to form a government that looked very fragile. The New Popular Front, the left-wing coalition that came out on top in the second round of the elections in terms of number of seats, has already promised a motion of censure. Barnier is effectively held hostage by Marine Le Pen’s far-right National Rally party, which will bring down the government if it joins the left.
Austrian Test
Will Austria be the next EU country to be governed by a hard-right coalition? Austrians will go to the polls next Sunday, indicating a clear victory for the far-right FPÖ party, led by Herbert Kickl, with almost 27 per cent of voting intentions.
The voters have apparently forgotten the scandals that led to the downfall of the FPÖ. The rightward swing of the Christian Democrats ÖVP, led by Chancellor Karl Nehammer, has not stopped the advance of the far right. According to polls, the ÖVP remains stuck at around 25 per cent. Andreas Babler’s Social Democrats SPÖ are in third place with around 21 per cent, while the Greens are in free fall at under 10 per cent. If the polls are confirmed, after the vote, Nehammer will have to decide whether to return to a coalition with the FPÖ as in the days of Chancellor Sebastian Kurz or opt for the more traditional formula of a grand coalition.
Austria is the European Union country most dependent on Russian gas imports. Its economy is stuck in reverse gear, with inflation outpacing the EU average. The slump in its top trade partner, Germany, which is grappling with the energy transition and competition from China, is dragging it down.
Despite the European Union’s goal to eliminate Russian gas imports by 2027, with Austria’s Green Party-led energy ministry pushing for an even faster transition, the country remains heavily dependent on Russian gas. As of July, Austria still imported 83% of its gas from Russia. This starkly contrasts the broader EU, which reduced Russian gas imports to just 15% by 2023. Energy experts suggest that an abrupt cessation of Russian gas supply could lead to a temporary spike in wholesale gas prices, potentially increasing by around 20% for a period of two to six months.
Sunday’s election will likely tell us more about the speed at which Austria will be able to implement structural reforms paramount to putting the economy back on track.
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