Olaf Scholz, tapped to be Germany's next finance minister, said Berlin would not lecture other EU states about their finances. His comments hint at an about-face in the eurozone's policy of strict fiscal discipline.
Image: picture-alliance/dpa/C. Charisius
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On Saturday, Germany's likely next finance minister, Olaf Scholz, insisted that Berlin would no longer seek to pressure other EU countries on their economies.
In an interview with Der Spiegel magazine, Scholz said Germany "doesn't need to dictate to other European states how they run themselves."
Scholz, who is expected to clinch the finance role in Chancellor Angela Merkel's next government following a coalition deal between her conservative alliance and his center-left Social Democrats (SPD), admitted that "mistakes have certainly been made in the past."
Merkel's cabinet takes shape - who's in and out at Germany's ministries
Reaching agreement on who should run particular ministries is one of the headaches that make coalition talks so long and torturous. Angela Merkel’s Christian Democrats have had to make considerable concessions.
Image: picture alliance/dpa/R. Hirschberger
Shifting responsibilities
There are five "classic ministries" in Germany's government – Finance, Foreign, Interior, Justice and Defense. Angela Merkel’s Christian Democrats (CDU) are ceding direct control of two of them. One, finance, is to change from right to left of the political divide, moving from CDU to Social Democrat (SPD) hands. Other switches are likely in less prominent portfolios.
Image: picture alliance/dpa/R. Hirschberger
Major prize changes hands
The transfer of the Finance Ministry from CDU hands to the SPD is the biggest surprise of the deal. The minister plays a major role at the European level as evidenced by the CDU’s Wolfgang Schäuble during the eurozone sovereign debt crisis. Hamburg Mayor Olaf Scholz, a centrist within the SPD, will likely get the title of deputy chancellor in addition to finance minister.
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Bavaria to take home ministry
The Interior Ministry, which deals with law and order within Germany, looks set to stay in the hands of Merkel’s conservatives, but not her own CDU. Touted for the position is the leader of Bavarian sister party the CSU, Horst Seehofer (left). The Bavarian party has taken a tougher line than Merkel on immigration. The conservatives suffered losses to the far-right AfD in September's election.
Image: Reuters/M. Rehle
Who will be Germany's top diplomat?
Under the deal, the SPD will keep control of the Foreign Ministry. Since 1966, the ministry has been run by a member of smaller coalition partners. Sigmar Gabriel has been in the role in a caretaker capacity since Frank-Walter Steinmeier was elected president. Martin Schulz (above), a former leader of the European Parliament, was expected to take over but pulled out in a bid to quell party unrest.
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Growing profile of defense
The CDU’s Ursula von der Leyen, a key ally of Merkel who is thought to have her own ambitions to become chancellor, is likely to remain in her role at the helm of the Defense Ministry. The ministry has had a growing importance in recent decades as Germany became more involved in foreign military operations. In particular, the Bundeswehr maintains a significant deployment of troops in Afghanistan.
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Justice unlikely to change hands
Typically a portfolio that goes to the junior coalition partner, responsibility for the Justice Ministry may well stay with the current incumbent — the SPD’s Heiko Maas. While individual states in Germany are generally responsible for the administration of justice, the federal ministry is charged with making and changing constitution-related laws. It also analyzes laws made by other ministries.
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Economic compensation
Helping to make up for the CDU losing two major offices, the CDU will get its hands on the Economy Ministry, also responsible for energy policy. Merkel's right hand in the chancellery Peter Altmaier (pictured) — who has also been running the Finance Ministry since the departure of Wolfgang Schäuble — is expected to take over from the SPD's Brigitte Zypries.
Image: picture alliance/dpa/M. Gambarini
New girl on the block
The favorite to take over at the top of the Ministry of Agriculture is the CDU’s Julia Klöckner, who leads the party in the western state of Rhineland Palatinate. Having twice failed in her bid to become state premier there, she'll be one of the relatively rare new faces in Berlin.
Image: picture-alliance/dpa/G. Fischer
Change of track
The CSU will also retain the Transport Ministry with CSU Secretary-General Andreas Scheuer, from Lower Bavaria, taking charge. He’d also be responsible for digital infrastructure. The party will hold onto the Federal Ministry for Economic Cooperation and Development, with undersecretary in the Transport Ministry Dorothee Bär set to take the reins from current Development Minister Gerd Müller.
Image: picture alliance/dpa/R. Vennenbernd
Health in same party hands
The Health Ministry remains a CDU concern, with Annette Widmann-Mauz, an undersecretary in the ministry from Baden Württemberg, expected to take over. She’d replace fellow CDU member Hermann Gröhe, who is touted to head up the Federal Ministry for Education and Research.
Image: picture-alliance/dpa/P. Pleul
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Change in eurozone policy?
Scholz'ss remarks were seen as a criticism of former Finance Minister Wolfgang Schäuble, who insisted on strict austerity in heavily indebted EU member countries during the eurozone crisis.
Schäuble, who led the Finance Ministry from 2009 until last year, put considerable pressure on Greece to rein in its deficits after the country came close to being ejected from the euro single currency.
He also oversaw several years of Germany's ballooning trade surpluses, which were widely criticized elsewhere in Europe for deepening the economic imbalances between EU states.
The plan for a new coalition, which would see the Social Democrats securing six ministries, still needs to be approved by the party's nearly half a million-strong membership in a postal vote. Results are expected early next month.
Conservatives worried
German media reported growing concerns within Merkel's Christian Democrats (CDU) about the Finance Ministry portfolio being given to the SPD, as they fear that Schäuble's policy of strict budgetary discipline might be at risk. In the Spiegel interview, Scholz, however, said he would present the country with a balanced budget if he were to take over the Finance Ministry.
"The Social Democrats are for solid financing," he told the magazine.
The proposed coalition agreement includes €46 billion ($56 billion) for economic and social development, and there is hope among some economists that Scholz could loosen the purse strings of Europe's economic powerhouse.
But the SPD politician insisted that the new government would not send finances into the red, adding that further investment "would depend on additional growth and the taxes generated from that."
Scholz also reiterated in the interview that Germany would help meet the funding gaps in the EU's budget resulting from Britain's decision to leave the bloc. But he said Berlin can't shoulder the burden alone.
Merkel's CDU, the allied Bavarian Christian Social Union and the SPD took heavy losses in Germany's September 24 elections, leading to four months of negotiations to try to a form a new government.
The SPD had vowed not to renew the coalition with the conservative parties that has ruled Germany since 2013, but reversed its decision after Merkel failed to form a government with two smaller parties.
