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Germany’s Merz Wants Deal With Trump, Calls Scholz Lame Duck

(Bloomberg)

(Bloomberg) -- German opposition leader Friedrich Merz, who’s dominating polls ahead of an expected snap election, said he would look to ink deals with incoming US President Donald Trump to boost his country’s international standing.

In an interview with Stern magazine, Merz called Chancellor Olaf Scholz a “lame duck” and urged him to accelerate the timetable for an early federal election following the collapse of the three-party coalition government last week.

Scholz, a Social Democrat, lost his majority in the German parliament on Wednesday after he sacked Finance Minister Christian Lindner, leader of the business-friendly Free Democrats, in a dispute over debt-financed government spending. Merz’s CDU/CSU-led conservative bloc has double the support of Scholz’s party, and has focused on how to smooth over Germany’s rocky relationship with Trump.

“In Germany, we have never really articulated and enforced our interests well enough, and we have to change that,” Merz said in the Stern interview. “The Americans are much more on the offensive. It shouldn’t end with only one side profiting, but rather with us making good arrangements for both sides. Trump would call it a deal.” 

Scholz is scheduled to give an interview to public broadcaster ARD later Sunday.

Merz accused Scholz’s center-left government of being wrong-footed by Trump’s reelection after backing Vice President Kamala Harris, the Democratic candidate. “Trump has a good memory,” Merz said. “The current federal government will no longer be heard by the new administration. Scholz is now a lame duck internationally.” 

As an example of a potential “deal” with Trump, Merz cited the delivery of US military aircraft. The CDU leader said that since Germany has agreed to buy F-35 fighter jets from the US, they should be serviced in Germany, with support by the Americans. “That would be a good deal for both sides,” he said.

Merz, 68, said he’s spoken to people who know Trump well, and that the US president-elect needs to be approached with “upright posture and clarity.” 

Like Trump, Merz had a lengthy feud with former Chancellor Angela Merkel, his party’s long-time leader. Frustrated by Merkel’s liberal policies, Merz left the political stage for some years and worked as chairman of the supervisory board of BlackRock Inc.’s German asset management unit.

What Bloomberg Economics Says...

“Germany’s political turmoil, together with Trump’s US election victory, will add to the already very high economic policy uncertainty in the near term. This may prompt businesses to further postpone investment decisions and weigh further on the modest recovery we forecast in the coming quarters.”

—Martin Ademmer, economist. For full note, click here

Scholz is under growing pressure to schedule an early election without delay. He initially proposed to pull forward Germany’s ballot from September to the end of March and lead a minority government with Economy Minister Robert Habeck and his Green party until then. 

But even Habeck, who’s also Scholz’s deputy, questioned his boss’ time plan and warned against formulating any conditions under which early elections could be held. The timing of a confidence vote in parliament shouldn’t be “mixed with pushing through certain political pet projects,” Habeck said Saturday, Deutsche Presse-Agentur reported.

Faced with growing criticism from within his own camp, Scholz signaled on Friday that he’d be willing to move up the election date if Merz’s CDU helps move some legislation through parliament before its term ends.

Ballot Paper 

German officials warned that holding elections as early as January may result in chaos. Ruth Brand, head of the Federal Election Commission, has warned of “incalculable risks at all levels” if the election is rushed and cited, among various problems, a potential paper shortage. 

CDU party general secretary Carsten Linnemann called Brand’s remarks “scandalous and shameful.” They’re “a reflection of what is going on in this country,” Linnemann told the Bild newspaper.

Alexander von Reibnitz, the head of Germany’s paper industry association, told broadcaster ZDF it’s clear that enough paper would be available to hold a nationwide election in January.  

According to an Insa poll published in Bild, 35% of Germans back Merz for chancellor, 18% are for Scholz and 16% favor Habeck. 

Scholz, who backed President Joe Biden for reelection, has made Germany a target of scorn for Trump and his ally Elon Musk. 

The Tesla Inc. chief executive officer and world’s richest person cheered the collapse of Scholz’s governing coalition with a German-language message on his X social media platform that translates as “Olaf is a fool.”

“I didn’t even take notice of it,” Scholz told reporters on Friday when asked about the post.

Scholz is also still waiting for a phone call with Trump after he reached out to the president-elect’s team on Wednesday as Trump locked down his election victory. 

--With assistance from Stefan Nicola and Christoph Rauwald.

(Updates with Habeck in ninth paragraph, head of paper industry in 13th paragraph.)

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