German Chancellor Olaf Scholz (SPD) is set to meet with Green Economy Minister Robert Habeck and Finance Minister Christian Lindner (FDP) on Tuesday and Wednesday for high-stakes crisis talks aimed at defusing a growing budget conflict within the three-party governing coalition.
“Regardless of the outcome of the US elections, I believe that this country deserves responsible governance. We’ll see in the next few days if everyone can muster the strength to actually achieve that,” Saskia Esken, leader of Scholz’s Social Democratic Party (SPD), told reporters on Monday.
Last Friday, a policy paper was leaked in which Lindner, also leader of the Free Democratic Party (FDP), proposed tax cuts and the relaxation of existing climate policies. His proposals, aligned with the FDP’s balanced budget approach, clash directly with the SPD and Green Party priorities.
The leaked 18-page document has drawn comparisons to a 1982 proposal by former Economics Minister Otto Graf Lambsdorff (FDP), which ultimately contributed to the collapse of the SPD-led government. The so-called Lambsdorff Paper cleared the path for the Christian Democrats (CDU/CSU) to assume power, leading to Helmut Kohl’s 16-year tenure as Chancellor.
Early elections or minority government?
Several crisis meetings are scheduled between Scholz, Lindner, and Habeck, concluding on Wednesday, 6 November. Tomorrow evening, the Coalition Committee—the government’s highest council—will convene to determine if the coalition partners will agree on a unified plan or go their separate ways. If they do part, options include early elections—potentially by spring—or an SPD-Green minority government if the FDP exits the coalition.
FDP Secretary-General Bijan Djir-Sarai clarified, “The chancellor and finance minister have committed to no spontaneous decisions before Wednesday.”
Central to these discussions is parliamentary approval of the 2025 budget, which must close a shortfall of at least €2.4 billion and agree on steps to stimulate Germany’s struggling economy.
Public sentiment: Half of Germans support early elections
A poll by public broadcaster ARD last week indicated that nearly three out of four Germans are worried about the economic situation, with half favoring early elections. Satisfaction with the ruling coalition has hit a low of 14%.
A potential Donald Trump victory in the US elections could also impact the political landscape, posing a fresh challenge for Germany’s coalition leaders. Omid Nouripour, the outgoing leader of the Greens, emphasized the need to address US election outcomes in Wednesday’s coalition meeting: “This will have serious implications for our economy, security, and Europe’s military dynamics.”
Scholz maintains a pragmatic stance
On Monday, government spokesperson Steffen Hebestreit confirmed that tripartite talks among Scholz, Habeck, and Lindner will continue throughout the week. “There is intense work underway to form an ‘overall economic strategy,’” Hebestreit noted.
When asked if his government was at risk, Scholz, who met NATO Secretary General Mark Rutte in Berlin on Monday, replied, “The government will do its job.” Scholz stressed that “this is not about ideology; it’s about pragmatism.”
