Political Overview: British negotiation capability questioned, SPD earns mixed reactions for tax plans, FDP rising to new heights

This week SPD chancellor candidate Martin Schulz presented his tax plans. Photo Credit: Olaf Kosinsky/Skillshare.eu

Almost exactly twelve months after the infamous referendum of June 2016, EU lead negotiator Michel Barnier and his UK counterpart David Davis have formally begun Brexit negotiation talks in Brussel, thereby opening up the latest chapter of the British withdrawal from the European institutions. Meanwhile, German politicians have voiced strong criticism against the UK’s negotiation stance which appears to be all too vague, erratic and additionally weakened by the recent parliamentarian elections’ political turmoil and the subsequent government reshuffle. „A negotiation partner not knowing his own goals is a difficult partner“, German MEP Elmar Brok noticed – a position that was quickly seconded by Foreign Minister Sigmar Gabriel and SPD lead candidate Martin Schulz. Both SPD politicians called for „British realism“ and clear yet reasonable negotiation demands.

Previously, Mr Schulz has unveiled his tax plans which would not only see top income but also corporate tax rates rising. Consequently, reactions varied between staunch opposition and cautious praise: the President of the Federation of German Industries (BDI), Dieter Kempf, didn’t withhold criticism and accused the SPD of knowingly hampering the economy. Contrasting this position, economists from the SPD-leaning German Institute for Economic Research (DIW) praised the plans as a reasonable and feasible balancing act between appeasing the party base and reassuring the corporate world that a Schulz chancellorship might only seek comparatively moderate changes. Yet, there is no hint that embracing the issue might save Mr Schulz from his quickly deteriorating poll numbers and generally poor chances to replace Ms Merkel.

This is even more the case since another party is already rising in the polls and creating the kind of momentum the SPD has lost since the May 2017 state elections: the FDP. Germany’s liberals have been revitalised by an energetic campaign and the increasing popularity of party chairman Christian Lindner who is widely considered to be young, smart and well-spoken enough to successfully reshape the party’s unfavourable image. With recent FDP numbers steadily oscillating between 8.0% (Forsa) and 10.5% (Allensbach), the chances of a CDU/CSU-FDP coalition have also been elevated to the rank of a serious theoretical possibility. For Ms Merkel, it would be another power option to use as a bargaining chip in possible coalition negotiations. For Mr Schulz, It’s another burden to overcome.

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