German Chancellor Angela Merkel's Christian Democrat party won a huge triumph in yesterday's elections. Almost certainly, Merkel will be chancellor for another term. The only question that remains is the nature of the governing coalition. So what does this mean for the rest of the world?
First and most important, the policies followed by the European Union in dealing with weak member states are unlikely to change. Germany controls the largest share of the wealth in the EU, and nothing happens without its full agreement. Merkel is unlikely to suddenly send cash to Greece, Spain, Italy, Ireland and Portugal without the usual conditions of austerity, even after Merkel is no longer facing an election. In the long run, this is a good thing for the world economy, but there may be some stumbles until we get there.
Second, German foreign policy will continue as before with only minor changes. This too is a good thing for the world.
Third, the idea that European voters are ousting governments that have been in power during the financial crisis and its aftermath has been dealt a death blow. The truth is that in each election in Europe, the local issues for each country have been controlling. There is no overall trend.
First and most important, the policies followed by the European Union in dealing with weak member states are unlikely to change. Germany controls the largest share of the wealth in the EU, and nothing happens without its full agreement. Merkel is unlikely to suddenly send cash to Greece, Spain, Italy, Ireland and Portugal without the usual conditions of austerity, even after Merkel is no longer facing an election. In the long run, this is a good thing for the world economy, but there may be some stumbles until we get there.
Second, German foreign policy will continue as before with only minor changes. This too is a good thing for the world.
Third, the idea that European voters are ousting governments that have been in power during the financial crisis and its aftermath has been dealt a death blow. The truth is that in each election in Europe, the local issues for each country have been controlling. There is no overall trend.
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