What’s in Germany’s “Traffic Light” Coalition Agreement

Olaf Scholz
German finance minister Olaf Scholz attends a debate in parliament in Berlin, July 8, 2018 (Bundestag/Inga Kjer)

Germany’s Social Democrats, Greens and liberal Free Democrats are ready to govern. Two months after federal elections almost to the day, they unveiled a 177-page coalition agreement that lays out their program for the next four years.

Social Democratic Party (SPD) leader Olaf Scholz, who would succeed Angela Merkel as chancellor, hailed the deal as the “biggest industrial modernization of Germany in more than 100 years.” It calls for major investments in decarbonization and digitalization.

Free Democratic Party (FDP) leader Christian Lindner would succeed Scholz at the Finance Ministry, despite his party being the smallest in the “traffic light” coalition (named after the parties’ colors).

The Greens get climate and foreign policy, and the right to nominate the next German EU commissioner. (Unless the conservative Ursula von der Leyen is reelected as commission president.)

Here are the highlights. Read more “What’s in Germany’s “Traffic Light” Coalition Agreement”

Commission Sides with Rutte over Macron on Industrial Policy

Emmanuel Macron Mark Rutte
French president Emmanuel Macron speaks with Dutch prime minister Mark Rutte during a European Council summit in Brussels, June 24, 2018 (Elysée/Philippe Servent)

The European Commission has sided with the Netherlands and smaller nations against a Franco-German proposal for industrial policy.

The decision is a victory for Dutch prime minister Mark Rutte, who has formed a loose alliance of likeminded Central and Northern European member states to prevent a lurch to protectionism in a Europe without the UK. Read more “Commission Sides with Rutte over Macron on Industrial Policy”

Biden Did Not End Trump’s Trade War with Europe

Kamala Harris Joe Biden
Vice President Kamala Harris and President Joe Biden of the United States deliver a news conference outside the White House in Washington DC, May 13 (White House/Adam Schultz)

During last year’s presidential election, Joe Biden promised to end America’s “artificial trade war” with Europe. His predecessor, Donald Trump, had imposed $7.5 billion worth of tariffs on European aluminum and steel.

Biden has relaxed the tariffs, but not abolished them. The EU has completely pulled down its retaliatory tariffs on bourbon whisky and Harley-Davidson motorcycles.

If anyone deserves credit for ending the trade war, it’s the EU. Read more “Biden Did Not End Trump’s Trade War with Europe”

Catalan Budget Crisis Is Tied to Independence

Plaça de Catalunya Barcelona Spain
Plaça de Catalunya in Barcelona, Spain, June 23, 2014 (Pixabay/Elena Repina)

One of my laments about Spain’s inability to resolve the Catalan independence crisis is that it complicates all other political issues in the region.

Catalonia’s pro-independence Republican Left has much in common with the Socialists and other left-wing parties, which want to remain in Spain. The formerly center-right Together for Catalonia now calls itself a big tent, but its economic and fiscal policies are still similar to those of the unionist Citizens and People’s Party. Yet separatists and unionists refuse deals, giving two far-left parties in parliament the balance of power. One is reasonable, the other is not.

The reasonable one, Catalonia in Common (which includes the Catalan branch of Podemos), supports Catalan self-determination but not independence, which is why it can’t join a government that wants to exit Spain.

The even more left-wing Popular Unity Candidacy (CUP) is also the most strident separatist party: it would secede from Spain tomorrow if it could. It has reliably backed governments of the Republicans and Together for Catalonia, but it has been fickle in its support for their policies. Read more “Catalan Budget Crisis Is Tied to Independence”

Dutch Get Preview of Next Government’s Policies

Mark Rutte Emmanuel Macron
Dutch prime minister Mark Rutte meets with French president Emmanuel Macron in the Elysée Palace in Paris, August 31 (Elysée/Laurent Blevennec)

A deal between two of the four parties negotiating to form a government in the Netherlands has leaked.

Prime Minister Mark Rutte’s liberal VVD (of which I am a member) and the Christian democratic CDA wrote the outlines of a coalition agreement for review by the social-liberal D66 and the smaller Christian Union.

Christian Union leader Gert-Jan Segers forgot a copy of the document on a train, where it was found by a fellow commuter, who sent it to de Volkskrant newspaper. (Seriously.)

Earlier D66 and VVD wrote their own outline of a coalition agreement, which was released officially.

Putting the two documents side by side gives us a good idea of what the next Dutch government will focus on. Read more “Dutch Get Preview of Next Government’s Policies”

Repeal of Spanish Labor Reforms Is Unwise

Madrid Spain
Skyline of Madrid, Spain (Unsplash/Alex Azabache)

Spain’s ruling left-wing parties have agreed to reverse the labor market liberalizations of the previous conservative government, which made it easier for firms to hire and fire workers.

The decision is hard to justify even by the standards set by proponents of repeal. The reforms did not create more precarious jobs, they did not cause higher structural unemployment and they barely made a dent in wages. Read more “Repeal of Spanish Labor Reforms Is Unwise”

Germany Has Bigger Drug Problem Than Netherlands

Frau Antje
Illustration from the cover of Der Spiegel, October 16

Der Spiegel makes a mockery of the Dutch drug policy. Under the header “Käse, Koks und Killer” (Cheese, Coke and Killers), the German weekly portrays the Netherlands’ stereotypical Frau Antje with a joint between her lips, a Kalashnikov in one hand and a round cheese stuffed with cocaine in the other. The Netherlands, it claims, is “terrorized” by drug traffickers.

(An English version of the story can be read here.)

To Germans who are thinking of following the Dutch example and decriminalizing cannabis, Der Spiegel has a clear warning: don’t, or we’ll suffer the consequences. Read more “Germany Has Bigger Drug Problem Than Netherlands”

Costa Loses Support of Portugal’s Far Left

António Costa
Portuguese prime minister António Costa arrives in Brussels for a European Council meeting, October 16, 2020 (European Council)

After six years, António Costa’s “contraption” has run out of steam.

It is what Portugal’s right-wing opposition dubbed the social democrat’s confidence-and-supply arrangements with the far left. In return for concessions like raising the minimum wage and making school textbooks free, the Communists and Left Bloc were willing to keep Costa in power.

Costa’s Socialists are eight seats short of a majority in parliament. The Communists and Left Bloc have 29 seats between them.

By not forming a full coalition, Costa could avoid the stigma of governing with extremists while the Communists and Left Bloc could openly criticize him for not raising salaries in the public sector or overturning the labor market reforms of his center-right predecessor.

That mutual understanding has collapsed. Read more “Costa Loses Support of Portugal’s Far Left”

Democrats Would Make American Child Care More Expensive

Joe Biden
American president Joe Biden walks down the colonnade of the White House in Washington DC, August 20 (White House/Erin Scott)

Over the summer, I wrote here that President Joe Biden’s child benefits — $300 per month for each child under the age of 6 and $250 for kids up to the age of 17 — help American parents pay for child care but don’t reduce the cost of child care.

Now Democrats propose to raise those costs. Read more “Democrats Would Make American Child Care More Expensive”

Political Fragmentation Hasn’t Weakened Germany

German parliament Berlin
Debate in the plenary chamber of the German parliament in Berlin, July 1, 2020 (Pixabay)

When Germany’s Christian Democrats and Social Democrats — who frequently split up to 90 percent of the votes between them during the Cold War era — fell to a combined 50 percent support in the federal election in September, alarm bells went off across the Atlantic.

The New York Times saw “messier politics” and “weaker leadership” ahead. The Washington Post feared a period of “limbo” as a result of Germany’s “Dutchification”. Harold James, a professor at Princeton University, lamented that Germany had acquired “the most destructive features of politics in neighboring countries.” The consequences, he argued, would be “complexity,” “endless negotiations” and “inevitably complicated coalition agreements.” Damon Linker, a columnist for The Week, predicted forming a “stable” government would be “challenging” and “decisive action” more difficult.

Some people never learn. We saw the same reaction after the European elections in 2019, and again when Stefan Löfven lost his parliamentary majority in Sweden this summer. Yet Christian Democrats, Social Democrats and liberals were able to quickly form a working majority in the European Parliament and Löfven remains prime minister.

Germany’s liberals and Greens — who can help either the Christian Democrats or Social Democrats to a majority — have already done a deal between them, clearing the biggest hurdle to a three-party coalition. Negotiations are now underway. Olaf Scholz, the Social Democratic Party leader, could become chancellor in a few weeks. So much for the “limbo” we were told to expect. Read more “Political Fragmentation Hasn’t Weakened Germany”