German Chancellor Angela Merkel's conservatives and her defeated election rivals the centre-left Social Democrats agreed today to launch formal talks to build a "grand coalition" government.
Such a left-right alliance ruling Europe's biggest economy would have a strong parliamentary majority and be able to drive through policy against the opposition of the two smaller parties, the ecologist Greens and the far-left Linke.
The deal to embark on thorny negotiations on policy and haggling over ministerial posts, likely from next Wednesday, came almost a month after Merkel's party triumphed in September 22 elections but missed out on a clear majority to form her third-term government.
"We have noted commonalities, we have noted differences and we have seen there is mutual trust," said conservative negotiator Alexander Dobrindt, the general secretary of Merkel's Bavarian allies the Christian Social Union.
Sigmar Gabriel, the leader of the Social Democrats (SPD), signalled that the traditional party of working class Germany would drive a hard bargain in helping Merkel back into power, especially on its core demand for a minimum wage.
Emerging from a meeting, he said Merkel's Christian Democratic Union (CDU) "knows that a general minimum wage of 8.50 euros (USD 11.5) is a central demand without which a grand coalition with the SPD wouldn't make any sense".
He said the seven-member SPD delegation had agreed unanimously that talks should go ahead and would take this proposal to a party meeting on Sunday, while the conservatives were to hold a party committee telephone conference Friday.
Gabriel is under pressure to extract major concessions from the conservatives if he wants to convince the sceptical party base to vote in favour of again governing in the shadow of popular Merkel, as it did 2005-09.
That experience left the 150-year-old party badly bruised and disillusioned after two stinging poll defeats in a row -- in the last election it scored only 25.7 per cent against 41.5 per cent for the conservatives.
In the ongoing political poker game, the SPD has nonetheless displayed swagger in its new role of kingmaker -- more so since Merkel's only other possible partner, the Greens, opted out of further talks this week.
"Now is the moment for the SPD: After the conservative-Greens exploratory talks collapsed, the SPD can drive up the price for an unloved grand coalition," commented one regional daily, the Thueringische Landeszeitung.
"And the Union with Chancellor Merkel at the top will have to pay."
A final hurdle will come when the Social Democrats' leaders ask their 470,000 rank-and-file members whether they want to again jump into bed with the CDU/CSU, a scenario many members regard as humiliating and dangerous.
