(BBG) Germany’s Talks Collapsed When an Old Ally Turned on Merkel

(BBG) It was five minutes before midnight in Berlin. After another long day of political negotiations, Christian Lindner’s hands were shaking. He had a dramatic decision to announce.

But people involved in Germany’s coalition talks said they had sensed what was happening hours before the Free Democrats chairman pulled the rug from underneath a tricky deal to construct a government out of four parties under Chancellor Angela Merkel. The writing was on the wall when the FDP turned up for the final day of talks with an inflexible attitude, frustrating the other groups, the people said, speaking on condition of anonymity.

A month of discussions culminated in recriminations. Germany’s president implored parties on Monday to return to the negotiating table while Merkel said she’d rather have a repeat election than govern without a stable majority.

If one thing has been made clear, it’s that more than a decade of backroom maneuvering and three previous coalitions have seen Europe’s de facto leader gather enemies at home as she made friends abroad.

“After 12 years in government, Merkel has a lot of political baggage and a lot of opponents, which makes her vulnerable,” said Carsten Brzeski, chief economist at ING Diba. “Merkel had over the years tried to secure unity and stability, which forced her political partners into painful compromises.”

Wilderness Years

The frustrations that emerged as the negotiations unraveled on Sunday laid bare tensions that had simmered throughout the talks.

Merkel, 63, didn’t trust Lindner, 38, after the FDP leader had harshly criticized her during the refugee crisis. She sees him as an opportunist and populist who shows no political responsibility, according to a person close to her. Lindner, meanwhile, has never been an admirer of Merkel, an FDP party official said.

Lindner said on Friday differences among the parties were surmountable before walking away from the talks two days later because the draft agreement contained “countless contradictions.”

The FDP had been pushing for a plan for the economy that included more business-friendly measures and wanted to enable countries to leave the euro without quitting the European Union. It took a harder line on immigration and made an accord involving the Green party very difficult, the people familiar with the talks said.

Some insiders said that history had come back to haunt Merkel. The FDP, which has often held the balance of power in Germany, was part of Merkel’s government between 2009 and 2013.

It struggled to follow through on its key political pledge over taxation and failed to win enough votes to re-enter parliament after being consumed by Merkel’s dominance of the center ground. It was the party’s biggest defeat in postwar politics and sent the FDP into the political wilderness before a comeback brought it back into coalition contention.

Broken Trust

“I suspect that Christian Lindner didn’t want this coalition partly because he wanted to topple Mrs. Merkel,” Juergen Trittin, a former Green environment minister under Gerhard Schroeder’s chancellorship and a member of the coalition talks, told Deutschlandfunk radio on Monday. “But this could lead to the ironic result that Mrs. Merkel could emerge from these talks strengthened as she is seen as the one who is acting responsibly and reasonably.”

A coalition agreement had been within reach, according to people involved in the discussions. The deadline of 6 p.m., imposed by the FDP two days before, had long been passed when Lindner stepped out to face reporters.

The chancellor and her Christian Democrats had tried to convince the FDP’s leadership to continue negotiations and asked what part of the deal it objected to. They were told it was the overall agreement that was unacceptable, according to the people. Merkel at one point said it was obvious the FDP had already taken the decision earlier, they said.

“The Liberals were afraid that they will be squeezed into a four party coalition which wouldn’t allow them to develop their own party profile,” said Juergen Falter, a political scientist from the University of Mainz. “Merkel has proven in her 12 years as chancellor that she is very good in playing one party off against the other.”