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Germany’s Schaeuble eyes another run as finance minister

The chances of Wolfgang Schaeuble returning as German finance minister are rising as the Sept. 24 election approaches and politicians from rival parties play down the prospect of unseating the wily veteran.

Schaeuble, who turns 75 next week, is the longest serving member of the German parliament. He is the face of German austerity policies that, critics say, deepened the euro zone crisis and hampered its economic recovery.

But he has made abundantly clear that he would relish another run as finance minister. Ministry officials have even discussed reserving Schaeuble’s wheelchair compatible hotel room in Washington for the 2018 spring meetings of the IMFand World Bank, according to one source. The ministry denies that any formal reservation has been made.

The only people who could stand in Schaeuble’s way are Chancellor Angela Merkel, who is on track to win a fourth term, and the leaders of the parties she ends up governing with. These include the Social Democrats (SPD), the pro-business Free Democrats (FDP) and the Greens.

It is a longstanding tradition that the junior coalition partner gets first choice of a ministry when a new government is formed. That means any one of the three parties could end Schaeuble’s run at the finance ministry.

But none of them seem intent on doing so if it means relinquishing prime cabinet positions like the foreign ministry, traditionally the most coveted post outside the Chancellery.

Top politicians in all three parties, from Martin Schulz and Sigmar Gabriel of the SPD, to Cem Oezdemir of the Greens and Alexander Graf Lambsdorff of the FDP, have set their sights on the foreign ministry, according to senior officials in the parties who spoke to Reuters on condition of anonymity.

“There is an argument for taking the finance ministry, but that would mean relinquishing the most cherished ministry of all,” one leading SPD politician told Reuters. “Both Schulz and Gabriel have their eyes on the foreign ministry.”

“I don’t see anyone kicking out Schaeuble,” said a senior Greens lawmaker, who conceded that no one in the party could be considered a serious contender for the post.

The finance ministry and the three parties declined to comment.

STILL HAUNTED

Opinion polls suggest three coalitions might result from the election: a two-way partnership between Merkel’s conservative bloc and the FDP, another “grand coalition” with the SPD or an untested three-way alliance between Merkel, the FDP and the Greens. Cabinet posts will be determined at the end of coalition talks that could drag on for months.

If there is a party that might be tempted to block Schaeuble it is the FDP, haunted by its decision not to take the finance ministry in Merkel’s second term. Instead, the FDP leader at the time, Guido Westerwelle, chose the foreign ministry, a move that backfired for him and his party.

From his perch in the finance ministry Schaeuble quashed the FDP’s plan for tax cuts, infuriating its pro-business supporters who fled the party, booting it out of parliament in 2013.

Should Westerwelle’s successor Christian Lindner decide to take the finance ministry for himself, either in a two-way coalition or a partnership that includes the Greens, it would be his for the taking.

But Lindner has sent signals that he may prefer to lead the FDP in parliament rather than take a ministerial post under Merkel, according to multiple FDP officials.

Much will depend on whether Merkel is prepared to push hard for Schaeuble during the coalition talks.

The two have a checkered past and have clashed over Greece and Merkel’s handling of the refugee crisis. But Merkel supported Schaeuble when he had serious health problems in 2010, giving him time off to recover when he was ready to resign.

And aides to the chancellor say Schaeuble plays a vital role in keeping the conservative wing of the CDU onside.

IMPORTANT ALLY

That will be crucial as she embarks on talks with French President Emmanuel Macron on reform of the single currency bloc.

People close to Schaeuble say Macron reminds the ageing minister of himself when he was a young, passionate advocate of European integration.

Schaeuble, who grew up near the French border, has since traded his idealism for pragmatism. He is sceptical about whether Europe is ready for the big leap forward that Macron has promised.

But Merkel may see him as the right person to forge a compromise with Paris.

Both she and Macron have voiced support for Schaeuble’s idea to turn the euro zone’s rescue mechanism, the ESM, into a more powerful European Monetary Fund (EMF).

In France, Schaeuble was long seen as an impediment to closer cooperation because of his insistence on fiscal discipline and hardline stance towards southern states like Greece. That too may be changing.

“We don’t always agree with him, but he is committed to euro zone reform,” said a French official close to Macron. “He is a francophile and he’s one of the few people out there who is putting forth ideas and thinking about solutions.”
Source: Reuters (Additional reporting by Thorsten Severin in Berlin, Michel Rose in Paris; Writing by Noah Barkin; Editing by Janet Lawrence)

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