German government coalition: Can CDU, SPD come together?

Negotiators of the conservative Christian Democratic Union andChristian Social Union (CDU/CSU) and the center-left Social Democrats (SPD) made major progress this week: In exploratory talks they agreed to take out massive loans to the tune of hundreds of billions of euros to strengthen the Bundeswehr and revamp ailing infrastructure.

The talks are moving along quickly. The parties have been in government together before — most recently under Chancellor Angela Merkel until 2021.

So, they have a lot of common ground, but there are also major differences. Here's where they stand on some of the biggest issues.

Bundeswehr and conscription

The CDU/CSU and SPD agree on the urgent need to invest and strengthen Germany's military, the Bundeswehr, at a time when the US seems to be turning away from Europe. The CDU/CSU is considering the reintroduction of compulsory military service, which was suspended in 2011.

The SPD, however, sees large-scale conscription as unmanageable and is pushing for a voluntary military service model.

Russia's war in Ukraine

Both the CDU/CSU and SPD agree that Germany has a duty to continue its support for Ukraine. CDU leader and likely next chancellor Friedrich Merz has repeatedly spoken out in favor of delivering German Taurus cruise missiles to Ukraine — something SPD Chancellor Olaf Scholz refused to do, arguing that these long-range missiles could drag Germany into the war.

The SPD has a history of advocating rapprochement with Russia. It was SPD Chancellor Willy Brandt who championed "Ostpolitik" (or Eastbound Policy) during the Cold War, introducing a detente policy that resulted in treaties with the Soviet Union, Poland and the communist East Germany (GDR).

Transatlantic relations

Here, too, there are differences of nuance. Both CDU/CSU and SPD have been appalled by US President's Donald Trump's treatment of Ukraine, his move to call NATO protection into question and his intention to impose import duties on European goods.

However, Merz is leaving the door wider open to the Trump administration than SPD leader Lars Klingbeil. Merz is still trying to keep the United States engaged in Europe and hopes to win it over to honor a security agreement with Ukraine.

Immigration

This is one of the biggest sticking points. The CDU/CSU are calling for a tougher immigration policy to prevent so-called irregular migration. This includes turning back refugees at Germany's borders without exception, including asylum seekers.

The SPD believes that this is neither compatible with the German constitution nor with EU law. SPD leader Lars Klingbeil made it clear on German public broadcaster ARD this week that his party will negotiate hard on this issue. 

"The SPD will not go along with any de facto border closures," he said.

Welfare and benefits

Welfare expenditure has increased over the past three years — also due to the influx of hundreds of thousands of recipients from Ukraine.

The so-called citizen's allowance (Bürgergeld), the basic income support for the long-term unemployed, was one of the Social Democrats' pet projects. The SPD wants to retain it. They do, however, want to step up counseling and checks to ensure that job offers are actually taken up.

The CDU/CSU and Merz want to see a fundamental reform of social welfare. He wants those who refuse to take up job offers to have their benefits slashed. This, however, would prompt legal action before the Federal Constitutional Court.

Economy and taxes

In general, the Social Democrats believe in government initiative, subsidies and investments to stimulate the economy. The SPD wants to support companies through write-offs for investments.

The CDU/CSU, however, intends to focus on encouraging private investment by offering tax breaks. They want to reduce corporate taxes in stages to a maximum of 25%. For income tax, the CDU/CSU wants to introduce a reform that would benefit high-income earners.

The SPD, on the other hand, wants to reduce income tax for an estimated 95% of taxpayers, while top earners would pay more.

Climate protection

The CDU/CSU does not want to give up the goal of reaching climate neutrality by 2045, but it has vowed to prioritize measures to boost the dwindling competitiveness of German industry. Specifically, the CDU/CSU wants to prop up the ailing car industry and to abolish the upcoming EU ban on combustion engines.

The conservatives have also vowed to retract the so-called heating law which ordered the gradual phase-out of oil and natural gas heating systems in Germany. They are considering a return to nuclear power.

This will amount to a turn-around in Germany's planned shift to renewables, and a watering down of the country's climate policy. Compromise, however, is possible.

This article was originally written in German.

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