Monday, June 18, 2018

MUNICH-BERLIN CRUNCH TIME

SEEHOFER IS UNHAPPY WITH HIS JOB (IT’S HIS BOSS, NOTHING ELSE!). Chancellor Angela Merkel’s Interior Minister Horst Seehofer reportedly (Welt am Sonntag here) told some of his friends from the Bavarian CSU (the CDU’s sister party) that he “can’t work with this woman anymore.” Making public such private aversion is uncommon in Berlin (it’s not London). Given the two party leaders ostensibly working together in a governing coalition dislike each other this much (though Merkel would never say it), we’ll make that the starting point as we explore a still unfolding drama in German politics.

(Our own Matthew Karnitschnig has the full wrap-up of Merkel’s race to quell the rebellion over the weekend to prime you for the rest of the day.)

What’s at stake for Seehofer? Merkel is his boss in the government hierarchy. If it’s so emotionally difficult for him to stick it out, the easiest way to get rid of his unloved partner is to just leave. The consequences of that, of course, are significant — ranging from Seehofer losing his job to a new general election.

What are the options? Seehofer could quit or give Merkel a pretext to fire him, and see what happens next. But he doesn’t have a mandate in either the Bundestag or in the Bavarian Landtag, and several people are already lining to take his other job as CSU chairman. If the whole CSU then withdrew from government, it’d be a major shake-up of the political landscape. Merkel, for her part, would be a handful of votes short of a majority in parliament. (Though her challengers won’t necessarily be able to cobble together a majority to take over as chancellor.)

When the CSU’s leadership convenes in Munich later today, they have three options on the table.

1. Blow it up: They could encourage Seehofer to act against Merkel’s orders and allow asylum seekers to be turned away at Germany’s borders — ironically, mainly with Austria. (It would be fun to see what happens to the Seehofer-Sebastian Kurz axis should that happen.)

2. Back down: They could theoretically back off, but that’s going to be a stretch. Some of the CSU’s top personnel escalated the affair to the point of adopting the far-right Alternative for Germany’s positions and language — the Bavarian Minister-President Markus Söder, for example, accused refugees of “asylum tourism.” Merkel remains stubborn — her stance on migration has become much tougher since 2015, but she refuses to take the last step. Less belligerent people such as Manfred Weber may weigh in in favor of this option, but their weight in the debate is today’s big question to watch.

3. Hold firm: Most likely, the Bavarians will give Merkel two weeks or so to complete the ultimate U-turn. That’s what party officials suggested on Sunday. (Seehofer himself wrote in an op-ed in today’s FAZ that the crisis is “severe, but manageable.“) That would limit Merkel’s room for manoeuver and turn her into just another EU leader who must use domestic pressure as an argument with EU partners.

OVER TO ANGELA. Merkel’s way out of the internal power struggle: She wants to make the issue a European one. It buys her time and provides an opportunity to not make the same mistake twice. Her decision to not close the German borders to migrants in 2015, taken without much consultation with the neighbors, triggered chaos. So might another solo run. Plus, she’s the one who has to deal with unhappy EU partners; Seehofer didn’t even find time to attend the last interior ministers’ meeting in Luxembourg, where migration was the main agenda point. Forcing Merkel to admit there is no European solution would very much mean following the Munich playbook.

Now, sober minds could argue that something that will cause a chain reaction is, by definition, a European issue. Closing Bavarian borders means causing dominoes to fall in Austria, Italy and other countries, where border controls would inevitably follow, ultimately hampering the free movement of people and killing the Schengen area. Of course, Schengen is dead if Germany’s out anyway, and Germany’s out once Bavaria gets its will. That’s quite a price to pay for a wealthy and über-industrialized region in the center of the Continent.

And that right there is why European partners are concerned about the Bavarian brawl. (Case in point, the Commission press room combusted on Friday.)

Next steps: Merkel “is in talks with several member states and the Commission,” her spokesman Steffen Seibert tweeted on Sunday, and might want to convene interested parties. (You shouldn’t really expect that to become a formal extraordinary EU summit.) An EU official said that “we are open to all formats and forums that serve to make as much progress as possible by the end of June” and that Brussels “is working closely with all European partners to pave the way for European decisions that can be supported by as many member states as possible. This will require hard work until the end of June.”

First partner Merkel is seeing: Later today, Italy’s Prime Minister Giuseppe Conte comes to Berlin.

Speaking of Conte: Jacopo Barigazzi has this comprehensive piece on how the new Italian government plans to blow up Brussels (and where the power actually lies in Rome).

Meanwhile, the Aquarius, the boat holding the migrants who were rescued in the Mediterranean and then turned away by Italy and Malta, arrived in Valencia over the weekend.

EURO REFORMS, ANYONE?

THAT OTHER CRISIS: France and Germany have moved a step closer to finalizing a deal on a eurozone budget, following a meeting of Finance Ministers Bruno Le Maire and Olaf Scholz in Hamburg over the weekend. They agreed to the principle of a eurozone budget focused on “convergence and stabilization,” according to a European source involved in the discussions.

Merkel and French President Emmanuel Macron were to take the next step, the source said, adding: “There will be no agreement if there isn’t a general agreement on all parts of the proposal.” Merkel, in her weekly podcast, announced that “answers to four big challenges, Franco-German answers,” will be discussed with the rest of Europe.

The French and German governments will meet in Meseberg on Tuesday. They’ll discuss migration, for sure, and security and defense, innovation and, alas, the “further development of the economic and monetary union.” Jean-Claude Juncker is coming, too.

But: There are more than two parties to this. Dutch Finance Minister Wopke Hoekstra wasn’t convinced, saying he did not understand why a common eurozone budget would be necessary. “No one is able to tell me what problem we would be solving with this,” Hoekstra told Frankfurter Allgemeine Zeitung.

And while we’re on Germany: The Neckartor intersection in Stuttgart, often Germany’s most polluted, is turning into the frontline in the national fight over air pollution. Matthew Karnitschnig traveled to diesel’s frontline.

SELMAYR LATEST

COMMISSION ANSWERS OMBUDSMAN: The Commission has responded to European Ombudsman Emily O’Reilly’s inquiry into Selmayrgate. The answer came in “on Friday, by the deadline,” the Ombudsman’s office told Playbook. But it doesn’t look like the Commission is particulary concerned about those answers being to the liking of the recipient. Impeccable in its formality, the tone of those eleven pages, which Playbook has seen, is somewhere between an eye-roll and a finger (not the thumb).

Take a look at this one: Responding to Parliament’s statement that the appointment of Martin Selmayr to the top civil service job in the Commission “could be viewed as a coup-like action,” the Commission offers this analysis: “A coup is defined as ‘a sudden, violent, and illegal seizure of power from a government’ where ‘the illegal and overt seizure of a state by the military or other elites within the state apparatus occurs.’ The Commission does not understand how a decision of the College of Commissioners, proposed by the president and supported unanimously by all the members of the Commission, can be compared with such a ‘coup-like action.’”

And this one: Was trust in the EU damaged by making Selmayr the Commission’s secretary-general? The Commission’s answer: No. In full: “The Commission does not agree that citizens’ trust towards the EU has been affected, neither is this assumption supported by the latest Eurobarometer surveys. 67 percent of EU citizens support the EU and are convinced that their country has benefitted from EU membership. In particular, trust in the European Commission has increased by 4 percentage points compared to last year with a larger percentage of people expressing their trust in the European Commission (46 percent tend to trust versus 39 percent who tend not to trust).”

That’s the Eurobarometer Playbook previewed last week; full results here.

Final finger: “The Commission does not consider that the criticism expressed about the appointment of the new secretary-general was justified.” It “will not accept that an internal procedure, made in full compliance with the EU Staff Regulations, as interpreted by the EU jurisdictions’ case law and with the Commission’s Rules of Procedure, can be considered as damaging the trust in the EU.”

IN OTHER NEWS

POLAND — WARSAW MULLS WHAT’S NEXT: Speculation about a potential changing of the guard in Poland’s ruling Law and Justice party is taking hold, after officials confirmed the country’s de-facto leader Jarosław Kaczyński was admitted to hospital due to a “life-threatening situation.” Michał Broniatowski, our man in Warsaw, gets you up to speed here.

Tusk vs. Kaczyński: Michał also wrote in to flag European Council President Donald Tusk’s interview with Poland’s Gazeta Wyborcza on Saturday. While it’s mostly about soccer, Tusk was also asked about Russian interference in elections around the world.

“I do not know if Russians interfered directly with the Polish election,” Tusk tells the paper. “Traces of their activity, very clear ones, can be found in several European countries. That was the case in Great Britain during the referendum, in Catalonia, in France, not to mention the Balkans. One thing appears to be certain: Moscow enjoys every act of disloyalty inside the European Union. Who weakens the union or counts on its collapse, objectively speaking, supports Russia. Perhaps, unexpectedly for himself, Kaczyński became one of the leaders of the pro-Putinist political camp in Europe.”

That provoked an immediate wave of hate from pro-PiS Twitter. Spokeswoman Beata Mazurek tweeted: “The actual leader of the pro-Putinist camp is fortunately not the prime minister anymore,” referring to Tusk’s stint as Poland’s PM. She then published several pictures of Tusk and Putin (including one in which Putin is consoling Tusk after the plane crash in Smoleńsk).

T-Day: European Commission First Vice President Frans Timmermans is in Warsaw for talks today ahead of an EU hearing on Poland’s rule of law.

ESM — GREEK CRUNCH TIME AT EUROGROUP MEETING: European Stability Mechanism chief Klaus Regling was in Athens last week to speak at a Hellenic Bank Association event. In an interview with Ta Nea, he said there could be a decision on the final disbursement from the ESM to Greece at the Eurogroup meeting in Luxembourg on Thursday. There could also be a decision on additional debt relief.

NORTH MACEDONIA UPDATE: The Greek and Macedonian governments signed a deal on Sunday meant to put an end to decades of dispute over the latter country’s official name. Greek Prime Minister Alexis Tsipras survived a no-confidence motion against him over the deal.

TECH — TRANSATLANTIC RIFT: The inability for European and U.S. officials to find common ground on tech policy does not bode well for the future of the internet, writes Mark Scott.