BERLIN (Reuters) – During Germany’s election campaign, the Social Democrats (SPD) rallied behind French President Emmanuel Macron’s ideas for reform of the euro zone, including the creation of a budget, finance minister and separate parliament for the currency bloc.
But as momentum builds for another “grand coalition” between the SPD and Chancellor Angela Merkel’s conservatives, doubts are rising about whether the center-left party will make European reform a top priority in looming negotiations.
Several senior SPD officials, some speaking on condition of anonymity, said that while the party continued to support Macron’s ideas, domestic reforms of health insurance, pensions and the labor market were likely to play a more prominent role in eventual talks.
“Europe is not a theme where we can simply push things through. We need to strive for a consensus,” said Johannes Kahrs, a budget expert for the SPD in parliament and leader of the conservative “Seeheimer Kreis” wing of the party.
“It would be nice if the conservatives went along with the idea of a budget for the euro zone, but they need to want it. It would make no sense to try to bully them into this.”
The comments may come as a disappointment to Macron, who called SPD leader Martin Schulz after the collapse of three-way talks between Merkel’s conservatives, the liberal Free Democrats (FDP) and Greens a week ago, and urged him to do his part to ensure political stability in Germany.
Macron’s European dream more difficult without ‘strong’ Germany
Another SPD official said achieving a level playing field on corporate tax rates in Europe and introducing a financial transactions tax were just as important as Macron’s plans to overhaul euro zone governance.
While Merkel has shown a readiness to work with Macron, other members of her conservative bloc are skeptical about his euro zone ideas, fearful Europe could develop into a “transfer union” in which Germany pays for reform-wary southern countries.
Over the past four years, the SPD struggled to put its mark on European policy, with Schaeuble, backed by Merkel, setting a strict rules-based course that emphasized structural reforms in euro member states over closer integration.
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