Two Birds With One Stone

Liberal- Democrats Leader, Martin Schulz- seen as Merkel’s strongest opponent. Schneid wants German federal government to spend more on EU and his message of “We can build again” is a strong challenge to Merkel’s old-style establishment.

Worryingly, the liberal- democrats seem unwilling to commit to any of Merkel’s policy views, particularly regarding ties with Russia.

One-fifth of the original negotiating team was sacked as a result of chronic infighting within Merkel’s Christian Democratic Union (CDU). Yet, the blame for the failed talks lies with Merkel. She seems more interested in keeping her existing cabinet than creating a government that offers anything new.

European Commission President Jean-Claude Juncker offered no assurances that the EU would support German efforts to deepen sanctions against Russia.

This is not the kind of feisty alliance that is supposed to grow together through hard work. Yet, it can take time for an alliance of this sort to emerge.

Greece’s left-wing Syriza party is determined to work closely with the populists in Eastern Europe on key issues such as tax evasion. Syriza- led governments would win a lot of support with the British public if they were to implement effective sanctions against Russia.

UKIP is so reviled in the rest of Europe, that London might well fall behind Moscow in terms of influence and spending on the EU’s annual 1.7 trillion euro budget.

The leading liberal- democrats share the same pro-Russian views as the liberals in Hungary and Poland.

One worrying theme in the agreement is that while everyone in Germany is united in the wish to stay in the European Union, it’s not too keen on remaining in the Eurozone.

Since the banking crisis in 2008, Germany has largely lost its appetite for the Eurozone, and looked in favor of leaving it.

It now appears that the CDU/CSU was content to keep its place as Europe’s strongest economy, but leave the Eurozone in order to make up the difference.

For Germany, the most difficult issue on the table in the negotiations were key issues of migration.

Merkel created a “top tier” negotiating team consisting of senior government officials, and the objective was to reach a deal on three key issues.

She wanted to reduce the numbers of refugees who are allowed to enter Germany to “tens of thousands,” making it the limit of the crisis.

Finally, she wanted to cap legal immigration to Germany, and turn away refugees not from war-torn places, but wealthy Germany.

While she aimed for a result within a week, the failure to secure a deal means that these issues may be pushed into the next election. Germany is already pushing the limits of its tolerance for migrants, in cases such as the Stuttgart rape case, and is an “open door” to migrants with no legal right to stay.

After negotiations fell apart, following a nasty spat over who was to blame for the breakdown of the talks, the market felt safe in guessing that there might be a different government in place for just over a year.

John Wroe is a business analyst based in Berlin.

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