German Parties Agree on a New Government. Now What?

Germany’s new government will push for a faster energy transition, an expansion of welfare spending and a deepening of EU integration, but could face internal dissent on fiscal policy that slows policymaking. Germany’s center-left Social Democratic Party (SPD), the environmentalist Greens and the pro-business Free Democratic Party (FDP) announced on Nov. 24 that they had reached a deal to form a government after almost two months of negotiations. Each party will ratify the agreement internally in the coming days, with the goal of holding a vote in the Bundestag on the week of Dec. 6 to appoint SPD leader Olaf Scholz as chancellor before the final European Council summit of the year, which will take place on Dec. 16-17. This will mark the end of Angela Merkel’s chancellorship after 16 years in office. ...