Policy Alert: German Election

Action: On February 23, German voters gave a plurality to the Christian Democratic Union and its sister Bavarian party Christian Social Union; the far-right Allianz für Deutschland came second, with just over 20% of the vote, doubling its previous result. Chancellor-designate Friedrich Merz, a lawyer, former Cabinet minister, and former head of the supervisory board of BlackRock Germany, will have to assemble a coalition government, a process that could take weeks.

Key Insights

German voters cast two votes: one for a local member of the Bundestag and one for a party list. The final results reflecting both votes are CDU/CSU 208 seats, AfD 152 seats, Social Democratic Party 120 seats, Greens 85 seats, The Left 64. It takes 316 seats to form a majority government.
The AfD won the largest share of party votes in most constituencies in the five states comprising the former East Germany, reflecting concerns over migration, jobs, and the economy.
Merz’ options are limited because the business-friendly Free Democrats failed to pass the 5% national threshold to win seats. Either the SDP or Greens could give him a majority; the likeliest (and perhaps quickest) option is a “grand coalition” with the SDP, perhaps including current government members such as Chancellor Olaf Scholz and Defense Minister Boris Pistorius.
Merz said in his victory speech that his main goal is “a functioning government in Germany as quickly as possible with a good parliamentary majority. The world . . . is not waiting for lengthy coalition talks and negotiations. We must now quickly become capable of acting again so that we can do the right thing at home, so that we are present in Europe again, so that the world sees that Germany will govern reliably again.” These sentiments point to the greater likelihood of a grand coalition with the SDP.
Merz is pro-business and wrote a book on capitalism. He favors support for Ukraine, strongly supports the EU and NATO and is generally pro-American, chairing the Atlantik-Brücke association.
However, ties with the US could become difficult. Merz also spoke to public broadcaster ARD, saying that “[f]or me it is an absolute priority to strengthen Europe as quickly as possible, so that we achieve independence from the U.S., step by step. I never thought that I would ever need to say something like that, on television, but after the latest statements made by Donald Trump last week, it is clear, that the Americans — at any case these Americans, this administration — mostly don’t care about the fate of Europe one way or another.” In very strong rhetoric, Merz added that the “intervention from Washington” [Vice President Vance’s remarks that European countries should accept parties of the far right] was “no less drastic, dramatic, and ultimately no less outrageous, than the intervention that we have seen from Moscow.”

Policy Alert: German Election

February 25, 2025

Key Insights

German voters cast two votes: one for a local member of the Bundestag and one for a party list. The final results reflecting both votes are CDU/CSU 208 seats, AfD 152 seats, Social Democratic Party 120 seats, Greens 85 seats, The Left 64. It takes 316 seats to form a majority government.

The AfD won the largest share of party votes in most constituencies in the five states comprising the former East Germany, reflecting concerns over migration, jobs, and the economy.

Merz’ options are limited because the business-friendly Free Democrats failed to pass the 5% national threshold to win seats. Either the SDP or Greens could give him a majority; the likeliest (and perhaps quickest) option is a “grand coalition” with the SDP, perhaps including current government members such as Chancellor Olaf Scholz and Defense Minister Boris Pistorius.

Merz said in his victory speech that his main goal is “a functioning government in Germany as quickly as possible with a good parliamentary majority. The world . . . is not waiting for lengthy coalition talks and negotiations. We must now quickly become capable of acting again so that we can do the right thing at home, so that we are present in Europe again, so that the world sees that Germany will govern reliably again.” These sentiments point to the greater likelihood of a grand coalition with the SDP.

Merz is pro-business and wrote a book on capitalism. He favors support for Ukraine, strongly supports the EU and NATO and is generally pro-American, chairing the Atlantik-Brücke association.

However, ties with the US could become difficult. Merz also spoke to public broadcaster ARD, saying that “[f]or me it is an absolute priority to strengthen Europe as quickly as possible, so that we achieve independence from the U.S., step by step. I never thought that I would ever need to say something like that, on television, but after the latest statements made by Donald Trump last week, it is clear, that the Americans — at any case these Americans, this administration — mostly don’t care about the fate of Europe one way or another.” In very strong rhetoric, Merz added that the “intervention from Washington” [Vice President Vance’s remarks that European countries should accept parties of the far right] was “no less drastic, dramatic, and ultimately no less outrageous, than the intervention that we have seen from Moscow.”

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