9/19/2005

Germany slides into political chaos after election - Yahoo! News

If it makes Bush dissapointed then it's good news -- law

The confused result is bound to cause consternation in London, which had hoped a solid Merkel majority would give a new push for economic reform in Europe, and in Washington, which had banked on a change of government to help mend the damaged relationship with Berlin


Germany slid into political chaos on Monday as the election produced a hung parliament, with both chancellor Gerhard Schröder and his challenger Angela Merkel claiming victory and the right to form a new government.

The uncertainty produced by the result was already being reflected in the markets on Monday morning as Frankfurt-listed stocks started to slide.... Jose Manuel Barroso, European Commission president, urged the country's political leaders to put together a ruling coalition as quickly as possible, amid fears that the stalemate could add to the sense of drift in Europe

The election outcome is unprecedented in German post-war history and caused bafflement in Berlin as Ms Merkel, who seemed set for an easy win just weeks ago, was left claiming a pyrrhic victory after an uninspiring and gaffe-ridden campaign.

In contrast, although the result was less than glorious for Mr Schröder's Social Democratic Party, he defied unanimous predictions that he would be out of a job by Monday.

The latest results gave Ms Merkel's Christian Democratic Union 35.2 per cent of the votes, a 0.9 percentage point lead over Mr Schröder, but her party clearly failed to win a majority for its preferred coalition with the liberal Free Democratic Party..

But in spite of the CDU's poor performance - its second worst result at a general election - Ms Merkel still appeared likely to become chancellor, though she might have to govern with the rival SPD in the first "grand coalition" since 1966.

Economists said such a coalition would make it difficult for Europe's largest economy to adopt the structural reforms needed to overcome stagnation and record unemployment.

The confused result is bound to cause consternation in London, which had hoped a solid Merkel majority would give a new push for economic reform in Europe, and in Washington, which had banked on a change of government to help mend the damaged relationship with Berlin

Germany slides into political chaos after election - Yahoo! News

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