(BBG) Merkel Tells Her German Rivals: Back Me or Face Voters Again

(BBG) German Chancellor Angela Merkel said she’s ready to face voters again to break the country’s political stalemate, betting they won’t blame her for failed talks on forming a coalition.

Regaining her footing after the sudden breakdown, Merkel made it clear in television interviews that she intends to serve her fourth term and prefers new elections to governing Europe’s biggest economy without a majority. Germany’s president, Frank-Walter Steinmeier, will start sounding out political parties on Tuesday to see if he can cajole them into an alliance with Merkel.

“A minority government isn’t part of my plans,” Merkel said in an interview with broadcaster ARD. “I’m certain that new elections are the better way.”

Angela Merkel on Nov. 21.

Photographer: Krisztian Bocsi/Bloomberg

Germany at Crossroads: What Are the Likely Scenarios for Merkel?

Twelve years into her chancellorship, Merkel’s former partners are wary of another deal after emerging from previous alliances bruised or broken. It’s a sign of her diminished influence after Europe’s refugee crisis helped send her Christian Democratic-led group to a historic low in September’s election while propelling the anti-immigration Alternative for Germany into parliament.

Disgruntled Partners

Steinmeier is calling on all parties to try again to reach a deal, saying anyone who seeks out a political mandate “must not be allowed to shy away from it when they hold it in their hands.” Merkel, who is due to attend a session of the Bundestag on Tuesday, said the breakdown of coalition talks was no reason to “back off” her pledge to provide another four years of sound governance, telling ZDF television that “Germany needs stability now.”

The Social Democrats, part of Merkel’s “grand coalition” over the past four years, are refusing a rerun after suffering their worst electoral defeat since World War II. SPD policy victories, such as a national minimum wage and gender quotas for supervisory boards, didn’t prevent the party’s decline.

“We have a very difficult situation,” SPD caucus chairwoman Andrea Nahles said. “Merkel doesn’t have the power to build a new government.”

The Free Democratic Party, which ended a month of coalition talks late Sunday, is wary because it crashed out of parliament after failing to impose its tax-cutting agenda as Merkel’s partner between 2009 and 2013.

And then there are personality clashes.

Merkel, 63, doesn’t trust FDP chairman Christian Lindner, 38, who harshly criticized her during the refugee crisis. She sees him as an opportunist and populist who avoids responsibility, according to a person close to her. Lindner, meanwhile, has never been an admirer of Merkel, an FDP party official said.

Lindner took a hard line, telling FDP members in a letter “the experiment of a four-party coalition is unfortunately finished.” He said relations were strained by differences over issues like burden-sharing in the European Union.

That won’t stop Merkel’s CDU from continuing to look for a compromise. Merkel’s chief of staff, Peter Altmaier, said it may take another three weeks to find out if forming a viable coalition is still possible.

“We are ready to make sure that the country continues to have stable and reliable government in the interim,” Altmaier said on ZDF television. “This is our trademark, like Made in Germany.”

Investors Shrug

Investors shrugged off the disarray, with both the euro and Germany’s DAX stock index rebounding from earlier losses on Monday.

President Steinmeier will kick off rapprochement efforts with the Greens and the FDP later Tuesday. The Greens already appear ready to compromise and resume efforts to form a coalition, which makes the discussions with FDP’s Lindner crucial.

While the presidency is mostly ceremonial, the deadlock is thrusting Steinmeier into a key role. He’ll be prodding parties to work together or engineering a minority government. If those efforts fail, it’ll be up to him to call new elections, though the constitutional hurdles to such a move are significant.

One problem Merkel doesn’t have is a challenge to her leadership of the Christian Democratic Union.

“We are happy and relieved that Merkel is making herself available,” Julia Kloeckner, chief of Merkel’s CDU in the western state of Rhineland-Palatinate, said on a Deutschlandfunk radio Tuesday.