Well that was quick. Taking power only last fall, Angela Merkel's governing coalition has already suffered a major setback. Following yesterday's elections in the state of North Rhine-Westphalia—Germany's most populous state—the ruling Christian Democrat-Free Democrat government was toppled.

The new coalition has yet to be formed, but it will undoubtedly involve the Social Democrats with either the Christian Democrats (yet another Grand Coalition) or the Greens and the Left Party (a frightful result that would bring avowed Communists into government). Whatever the result, Merkel will have a hard time pushing her current national agenda—the CDU and FDP will no longer control the upper house, thus creating a potential roadblock on issues ranging from Afghanistan to welfare reform to the bailout of EU states.

At the moment, according to the latest results, the CDU has a razor-thin edge over the SPD, 34.6 percent of the vote to 34.5. (The Christian Democrats plummeted 10 points since the 2005 elections.) But while the Free Democrats garnered 6.7 percent of the vote, the Greens doubled their share from 6.2 to 12.1 percent. In short, the next few weeks will be a mess.

The Economist reports that for a majority of voters, the government's decision to help bail out Greece was an influencing factor. In addition, Merkel's stalling tactics on other economic issues (in the hopes of making unpopular decisions after the state elections) was frowned upon. Also unpopular were the tax cuts long proposed by the Free Democrats. (As more than a few Germans have told me, tax cuts just do not have the same appeal to them as they do to Americans. If we get a check from the government, the hope is that we spend it, pumping it back into the economy. Germans, on the other hand, would take the check and immediately deposit it in their savings accounts and never touch it again.) Merkel has just announced she has no plans to cut taxes in 2011 or 2012.

So now the blame game begins. Merkel will take her lumps but her foreign minister, Guido Westerwelle, will take a big hit as well. "[Westerwelle's] pugnacious behaviour, which served him well in opposition, looks inappropriate in office," reports the Economist. "He may eventually face a challenge to his leadership of the FDP."

Just last week I met with a senior member of the Free Democrats who was visiting Washington. I was surprised by his frankness when I asked him to rate the leader of his party. "He's terrible," replied the FDP veteran, who went on to complain about Westerwelle's lack of preparation for the job as foreign minister and his tendency to hold more press conferences than do anything of substance—including making a credible case for tax cuts.

In addition, reports Der Spiegel:

Within her party, too, Merkel will face greater opposition. Assuming Governor Jürgen Rüttgers, who is seen as the main loser of Sunday's election, does not succeed in wangling a second term, the chancellor will have lost an important ally on the left wing of her party. The CDU's other 10 state governors will want to avoid meeting a fate similar to Rüttgers'. They consider Merkel to be partially responsible for his defeat and are likely to exert pressure on the chancellor to make sure the same thing does not happen to them. That could take the form of open attacks on Merkel and is likely to weaken her position as party leader.

As is typical in any country following a major political disaster, this is when the knives come out. I just hope they aren't long ones.

Next Page