Parties Vie for Power After Election Shakes Up German Politics

Published Sept. 27, 2021Updated Sept. 28, 2021, 5:03 a.m. ET

The center-left narrowly defeated Angela Merkel’s conservatives, but it is not clear who will govern. Hard coalition talks lie ahead, and smaller parties will be pivotal.

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Preliminary official results showed the Social Democrats ahead in Germany’s election, with no party winning a decisive majority and Chancellor Angela Merkel’s Christian Democrats facing a sharp drop in their share of the vote.CreditCredit…Laetitia Vancon for The New York Times

For a moment it felt as if he were already chancellor. As Olaf Scholz stood on the stage surrounded by euphoric followers chanting his name and celebrating him as they would the next leader of Germany, he was the clear winner of the night.

Mr. Scholz had just done the unthinkable — carry his long-moribund Social Democrats to victory, however narrow, in the most volatile German election in a generation.

But if winning wasn’t hard enough, the hardest part is yet to come.

Mr. Scholz may have come out on top in Sunday’s election, but three in four Germans did not vote for him or his party. Despite overtaking the mighty conservative party machine of the outgoing chancellor, Angela Merkel, there is no certainty that Mr. Scholz will become chancellor. And if he does, he is likely to be a weaker one, absorbed in wrangling multiple coalition partners in addition to rebellious factions within even his own party.

A new era in politics has officially begun in Germany — and it looks a lot different. And difficult. Germany’s political landscape, long a place of sleepy stability where chancellors stay on for 16 years, has fractured into multiple parties that no longer differ all that much in size.

“It’s a historically unprecedented situation,” said Thomas Kleine-Brockhoff, the Berlin-based vice president of the German Marshall Fund, a research group. “There is a structural shift going on in German politics.”

“A multidimensional chess game has opened,” Mr. Kleine-Brockhoff said.

Instead of two dominant parties competing in turn to go into a coalition with one much smaller partner, four midsize parties are now jockeying for a place in government. For the first time since the 1950s, the next chancellor will have to get at least three different parties behind a governing deal.

Not least, Mr. Scholz’s conservative runner-up, Armin Laschet, could still beat him to the top job.

Mr. Laschet, whose unpopularity and campaign blunders saw his party crashing to the lowest election result ever, plans to do just that.

Unimpressed by appeals to concede defeat on “moral” grounds, Mr. Laschet said an “arithmetic” win was no longer enough to claim the chancellery.

“No one should behave as if he alone could build a government,” Mr. Laschet told reporters Monday. “He who can build a majority to back him will become chancellor.”

It would not be the first time that someone who has not won the popular vote becomes chancellor. Willy Brandt and Helmut Schmidt, both center-left chancellors, formed governments even though they lost the popular vote.

But those precedents did not face the complex multiparty negotiations about to start in Germany.

Mr. Scholz, who has served as Ms. Merkel’s finance minister and vice chancellor for the last four years, is walking into a fiendishly complicated process where the power of who will become the next leader almost lies more with the two smaller parties that will be part of any future administration: The progressive Greens, who at 14.8 percent had the strongest result in their history, and the pro-business Free Democrats, at 11.5 percent.

In another first, the Greens and Free Democrats signaled that they would get together to hold talks ahead of any negotiations with the bigger parties.

Social Democrats (S.P.D.) made their biggest gains

in Mecklenburg-Western Pomerania, where they

won the seat Angela Merkel had held for more

than 30 years.

Vote margin

S.P.D.

C.D.U./C.S.U.

Greens

Hamburg

Berlin

Cologne

Despite losing support

nationwide, the far-right

Alternative for Deutschland

(AfD) still won in much of

Saxony and Thuringia.

The Greens made large

gains, especially in cities

like Berlin and

Cologne.

Munich

Christian Democrats

comfortably won the

Bavarian heartland.

Vote margin

Social Democrats (S.P.D.)

won the seat Angela Merkel

had held for more than

30 years.

S.P.D.

C.D.U./C.S.U.

Greens

Hamburg

Berlin

Cologne

Munich

Christian Democrats

comfortably won the

Bavarian heartland.

Vote margin

S.P.D.

Social Democrats (S.P.D.)

won the seat Angela Merkel

had held for more than 30 years.

C.D.U./C.S.U.

Greens

Hamburg

Berlin

Cologne

Munich

Christian Democrats

comfortably won the

Bavarian heartland.

Germany’s mainstream conservatives, long the dominant force in the country’s politics, suffered the worst defeat in their history in the election on Sunday, faring significantly worse in every part of the country than they did in the previous election, in 2017.

Angela Merkel’s Christian Democratic Union and its Bavarian sister party, the Christian Social Union, won just 24 percent of the vote, almost 9 percentage points below their showing four years ago. They led the voting in just two of Germany’s 16 states, Bavaria and Baden-Wurttemberg in the south, down from 13 states in 2017; in several states, they fell to third place.

The Social Democrats and the Green Party made the biggest gains.

The German DAX stock index held steady Monday as investors concluded that Sunday’s election did not signal any major change for the country’s economic outlook.Credit…Reuters

Investors like stability and continuity, and that’s what they saw in the German election on Sunday. On Monday, German stock indexes and the euro barely budged.

“Germany will not have a polarizing head of government like Donald Trump in the U.S.A. or Boris Johnson in Great Britain,” Christian Kahler, chief investment strategist at DZ Bank in Frankfurt, said in a statement Monday. Olaf Scholz of the Social Democrats and Armin Laschet of the Christian Democrats, the two people most likely to become chancellor, “stand for continuity in German politics,” Mr. Kahler said.

For the most part, Germans eschewed extremes, spreading their votes among moderate parties in a way that all but rules out domination by any single one. That was comforting to many businesspeople, but there were also murmurs of disappointment that the vote produced no clear winner strong enough to address Germany’s eroding competitiveness: its lagging investment in digital technology; its high energy prices and slow response to climate change; and its dependence on trade with China.

Ahead of the vote, some business managers and investors worried that it would produce a left-wing government made up of the Social Democrats, the Greens and the far-left Die Linke. But Die Linke’s support was too weak for the three parties to muster a governing majority.

The far-right Alternative for Germany, or AfD, also lost ground, though it solidified its support in the eastern German states of Saxony and Thuringia, where it was the strongest party.

The future government is likely to include the Greens, whose biggest issue is climate change, and the Free Democrats, a pro-business party that campaigned against overregulation. Neither the Social Democrats, who got the most votes, nor the Christian Democrats, who came in second, appear inclined to join in a coalition as they did after the last two elections.

If they don’t, neither can lead a government without support from the Greens and Free Democrats, whose policies may tend to cancel each other out.

The Greens will push for faster action against climate change and investment in digital infrastructure, but the Free Democrats are likely to insist on observing limits on deficit spending, Oliver Rakau, an economist at Oxford Economics, predicted in a note to clients.

“A radical about-face on major domestic or European issues,” Mr. Rakau said, “is unlikely.”

Tessa Ganserer talking to reporters in Berlin last month. Ms. Ganserer was one of two transgender candidates to win seats in Parliament.Credit…John Macdougall/Agence France-Presse — Getty Images

The name “Tessa Ganserer” did not appear on the ballot in Sunday’s election, but Ms. Ganserer still won a seat representing a district of Nuremberg, making history as one of the first two openly transgender people to join the German Parliament.

She had to run under the name her parents gave her at birth, because she refused to submit to the country’s 40-year-old law requiring a medical certificate before a person can legally change name and gender identity.

Another trans woman, Nyke Slawik, 27, also won a seat. Both belong to the Greens Party, which stands a strong chance of entering into government as part of a coalition.

“Crazy!” Ms. Slawik wrote on her Instagram page. “I still can’t really believe it, but after this historic election result I will definitely be part of the next German Parliament.”

Ms. Ganserer, 44, wrote on her Facebook page: “It was the election campaign of our lives and it was worth it. The old, backward thinking was punished yesterday.”

In 2017, Germany legalized same-sex marriage and adoption by gay parents, and passed a partial ban on conversion therapy, which aims to change a person’s sexual orientation or gender identity.

This year, the country banned operations intended to assign babies to particular sexes if they are born with sex characteristics. That means parents can no longer make that choice; the children get the right to decide for themselves later in life. But lawmakers rejected two bills proposed by the Greens and the Free Democrats that would more generally make it simpler for transgender people to self-identify.

Currently they are required under the country’s Transsexuality Law, passed in 1981, to obtain a medical certificate, at the cost of hundreds to thousands of dollars. Working to change that requirement, which opponents describe as stigmatizing as well as costly, will be one of Ms. Ganserer’s priorities in Parliament, she said.

Olaf Scholz, the Social Democratic candidate who hopes to become chancellor, during the campaign blamed the Christian Democratic Union for the failure to change the medical certificate law under the previous government. Rights groups are hopeful that the combination of a Social Democrat-led government and two trans representatives will give an impetus to change.

Christian Lindner, lead candidate of the German Free Democrats, right, during a party news conference in Berlin, on Monday.Credit…Martin Divisek/EPA, via Shutterstock

When Christian Lindner, the head of the pro-market, anti-regulation Free Democrats announced just after the election that he would talk with the pro-regulation Greens about collaborating to form a government, it caused a minor sensation.

Although the Greens finished in third place in Sunday’s vote and Mr. Lindner’s F.D.P., as it is known in Germany, ran fourth, together they hold the keys to the chancellery. Collectively they won more than 26 percent of the vote, making it very likely that both will be needed to form a majority coalition and a new government.

Normally it is the role of one of the bigger parties — in this case the Social Democrats, who beat Angela Merkel’s Christian Democrats by 1.6 percentage points — to approach the smaller ones to discuss a coalition.

Mr. Lindner flipped that convention.

Admitting that there was the “biggest difference in content,” between the Free Democrats and the Green party, Mr. Lindner said Monday that it made sense for them “to see if this could become a progressive center of a new coalition, despite all the differences.”

If the two parties can compromise on policy and power-sharing, they can bargain from a position of strength, effectively choosing which major party gets to govern. Either the Social Democrats or the Christian Democrats would gladly work with the two smaller parties.

Robin Alexander, a senior political journalist with the conservative newspaper Die Welt, described the talks as a smart move. Both the Greens and the Free Democrats have previously been junior coalition partners, but their combined strength is greater than ever.

As recently as 2013, the Greens drew 8.4 of the vote and the Free Democrats narrowly missed the 5 percent threshold for winning seats in Parliament. On Sunday, the Greens won 14.8 percent, their highest ever, and the Free Democrats got 11.5 percent.

The Social Democrats and Christian Democrats could form a “grand coalition,” their third in a row, but that option, unpopular in both parties, appears unlikely.

The other parties have sworn off working with the far-right AfD Party, which finished fifth. The far-left Die Linke party won too few seats to help the Social Democrats and Greens reach a majority.

So the only likely formula for a majority, for either of the major parties, is with the Free Democrats and the Greens.

The Free Democrats have a mixed history when it comes to coalition-building. In 2017, members walked out of weeklong negotiations with the Ms. Merkel and the Greens, prompting the latest grand coalition.

“It’s better not to govern at all than to govern wrongly,” Mr. Lindner said at the time.

Olaf Scholz at the German Social Democrats party headquarters following the SPD’s narrow win in the federal elections, in Berlin, on Monday.Credit…Sean Gallup/Getty Images

A tired-looking Olaf Scholz took to the stage Monday morning at his Social Democratic headquarters, making clear that he saw his party’s significant gains in the election as a mandate from voters to head up the next government with the two smaller parties that also made gains in Sunday’s vote.

“Voters have clearly spoken,” he said. “They have said who should build the next government by strengthening three parties, the Social Democratic Party, the Greens and the Free Democrats. Consequently, that is the clear mandate that voters of this country have given, that these three parties should create the next government.”

The Social Democrats made significant gains, earning 25.7 percent of the vote, but will still need at least one other partner to form a government. Both the Greens and the Free Democrats also increased their share of seats in Parliament, to 14.8 percent and 11.5 percent, respectively.

But with German voters spreading their support across a wide spectrum of parties, the outcome remained anything but certain, with Christian Democrats still trying to claim they can lead the coalition to form the next government, despite suffering a consequential loss of nearly nine points, to earn only 24.1 percent of the vote.

Mr. Scholz, 63, said that result made it “clear” that voters wanted to see the Christian Democrats and their Bavaria-only sister party, the Christian Social Democrats, in the opposition after 16 years in power, under the leadership of Chancellor Angela Merkel. She did not run for election, and the seat that she had held in Parliament since 1990 was won by a Social Democrat.

“The mandate for us is to do what the people want,” Mr. Scholz said, adding that was “to lead a good government that will set the course for the decade ahead, to bring more respect into society, to modernize our industrial sector and to halt the man-made climate change.”

German Chancellor Angela Merkel with President Emmanuel Macron of France in Paris earlier this month.Credit…Ludovic Marin/Agence France-Presse — Getty Images

BRUSSELS — Europe, like Germany itself, must wait for a new German government to emerge. But everyone knows this may take some time — four years ago, it took nearly six months.

Angela Merkel remains chancellor until then, which is reassuring to her European colleagues. And she is likely to still be chancellor at a summit meeting of the European Union in December. But a caretaker government is obliged not to make any important new decisions, so Brussels needs patience, too.

President Emmanuel Macron of France and others want to make some significant changes in E.U. policy, and on Jan. 1, France begins a six-month rotation in the E.U. presidency. But Germany may not have a new government by then, and it is not clear where that government will stand on some of the issues facing the bloc.

In addition, Mr. Macron is up for re-election in April and will have to turn his attention to the campaign. The consensus in Brussels is that the window of opportunity to make big changes next year is likely to be brief.

With Ms. Merkel limited or gone, Mr. Macron does have a chance to be more influential in Brussels, especially if he can find common ground with Mario Draghi, the Italian prime minister, while moving gradually enough to bring the Germans along.

While Brussels does not comment publicly on elections in E.U. member states, there is general relief that whatever German government emerges, it will be center-left or center-right, shorn of extremes and deeply pro-European and trans-Atlanticist.

Speaking at his Social Democratic Party headquarters, Olaf Scholz, whose party came out narrowly on top in the German elections, said he favored “a stronger and more sovereign European Union,” while at the same time saying that the trans-Atlantic partnership with the United States remained essential for Germany. “You can rely on continuity in this question,” he said.

So there will be stability. But any likely three-party coalition will also be hindered by its internal policy disagreements, and that will make a difference for those Europeans, like Mr. Macron and also the southern nations, who favor faster progress on building the eurozone and a banking union, and a more flexible view of European debt rules.

The future role of the Free Democratic Party and its leader, Christian Lindner, is seen as particularly important, especially if he becomes finance minister in a new government, as some suggest. The party is pro-business, wants tax cuts and is opposed to large new debt. On the European level, it opposes further financial integration and collective debt of the kind Ms. Merkel agreed to, exceptionally, to produce a coronavirus recovery fund.

The Free Democrats also oppose a permanent relaxation of the rules governing European debt, however bent they have been by massive state spending during the coronavirus pandemic. With large new investments needed to combat climate change, the German position is bound to matter.

How countries get back to the old rules limiting budget deficits to 3 percent of gross domestic product and total debt to 60 percent is almost unimaginable, a senior French official said. But it’s better to let reality sink in, he said, without pushing the issue too hard.

Ms. Merkel will be missed and hard to replace. A survey by the European Council on Foreign Relations asked residents in 12 E.U. nations whom they would vote for in a hypothetical election for president of Europe. Ms. Merkel received more support than Mr. Macron in every country, including his own.

In Bad Segeberg near Hamburg, and across Germany, campaign signs were coming down on Monday, one day after general elections.Credit…Fabian Bimmer/Reuters

Germany’s Social Democrats won Sunday’s election, though it is not yet clear whether they will lead the next German government. But if they do, the country could see a shift to a domestic agenda more focused on social justice and climate, and a foreign policy that emphasizes multilateralism and strengthening the European alliance.

In his campaign, Mr. Scholz talked mostly about domestic issues: pledging good jobs to address the widening gap between higher earners and those struggling for a place in society, and to revive the country’s ambitions to reduce its climate footprint.

Mr. Scholz vowed to increase the minimum wage to 12 euros, or $14 per hour, and to soften welfare reforms introduced by Chancellor Gerhard Schroder, the last Social Democratic chancellor, who was voted out of office in 2005.

The Social Democrats emerged as the strongest force on Sunday, winning 25.7 percent of the vote in an election that saw support spread across the political spectrum. The party also won the two state races that were held in Berlin and Mecklenburg-Western Pomerania.

Asked on Monday whether he felt capable of filling Chancellor Angela Merkel’s shoes on the European stage, Mr. Scholz responded with confidence.

“I have already explained my own point of view,” he told reporters. “I think that an important point will be, first of all, to strengthen the European Union.”

Mr. Scholz, who has served as Ms. Merkel’s deputy chancellor and finance minister over the past four years, was Germany’s main architect on a plan to take on shared debt to help economically weaker members recover from the downturn caused by the pandemic. At home, he abandoned the country’s once-tight adherence to a balanced budget to keep German citizens and companies afloat in the face of the pandemic.

Asked whether he would be willing to help out Britain, which is facing a shortage of labor, particularly truck divers, he made clear his position on dealing with the country that decided in 2016 to leave the European Union.

“The free movement of labor is part of the European Union, and we worked very hard to convince the British to not leave the Union,” he said. “Now they decided different, and I hope they will manage the problems coming from that.”

In July, Mr. Scholz visited Washington, where he met with Treasury Secretary Janet Yellen to discuss his efforts to push through a global minimum corporate tax, a project that several weeks later won backing from the Group of 20 countries. Ending tax havens has long been one of his pet projects.

Armin Laschet, the Christian Democratic Union’s candidate for chancellor, at party headquarters in Berlin on Monday.Credit…Maja Hitij/Getty Images

His party suffered its most significant loss since its founding, but Armin Laschet, the head of the conservative Christian Democratic Union, refused to concede defeat on Monday, instead positioning himself as skilled at building the bridges needed to form the next German government.

Speaking to reporters after a long meeting of his party’s leaders, Mr. Laschet insisted that the rival Social Democrats, who won the largest share of the vote with 25.7 percent, had no more right to claim a mandate to build a government than his party, even though the Christian Democrats won only 24.1 percent. Mr. Laschet’s candidacy was unpopular within his party’s right wing, and Monday brought finger-pointing and recriminations.

While he conceded that he had played a role in his party’s terrible result, Mr. Laschet did not step down, or even simply congratulate his main rival. Instead, he sought to cast the Christian Democrats and the Social Democrats as losing equally, since neither had been able to win 30 percent support.

“For us it is clear that no party can claim a mandate to build a government out of this result,” Mr. Laschet said. “No one should behave as if he alone could build a government.”

He went on to say that his party would talk with all potential partners, adding that they would remain open to speaking with their traditional partners in government, the Free Democrats, who placed fourth, and the Greens, who placed third. The two parties gained significant voter support and are likely to be a part of the next government.

If the Greens and the Free Democrats can reach agreement on key points where they differ, including taxes and energy, they are likely to find themselves in the position of kingmaker — getting to decide which of the two leading parties they would like to govern with.

“He who can build a majority to back him will become chancellor,” Mr. Laschet said.

But there was no getting around the reality that the result was deeply painful for the Christian Democrats and that Mr. Laschet, 60, was an unpopular candidate from the outset. Even older voters, the conservatives’ core base, shifted their support to the Social Democrats, voter trends showed.

“I can’t understand at the moment how there is any chance that Armin Laschet could become the next chancellor after this result,” Julia Reuschenbach, a professor of political science at Bonn University, said in a postelection discussion organized by the German Marshall Fund.

Franziska Giffey, a member of the Social Democrats and a former cabinet minister, won the Berlin mayor’s race.Credit…Lisa Leutner/Associated Press

BERLIN — The Social Democrat Franziska Giffey, an East-German-born former cabinet minister, is poised to become Berlin’s mayor. She will be the first woman to run the city since its founding in 1237.

In addition to voting for the federal Parliament, Berliners also voted for their city government on Sunday.

Although early projections on Sunday evening favored the Greens, the Social Democrats came through as ballots were counted late into the night. The Social Democrats got 21.4 percent of the vote, the Greens, 18.9 percent, and the conservative Christian Democrats 18.1 percent. Since no one got a majority of the vote, a coalition will be needed, but Ms. Giffey seems to have the support to build one.

Ms. Giffey, 43, was seen as one of the most promising Social Democratic politicians in Germany, but resigned her post as federal family minister this year over allegations that she had plagiarized parts of her doctoral thesis. She was also stripped of her doctorate.

Because Berlin, the capital city with a population of 3.6 million, is one of three German city-states, its mayor is also one of the 16 state governors in the federal republic.

The post is politically important. In the 20th century alone, it was occupied by Willy Brandt, who went on to become the first Social Democratic chancellor, and Richard von Weizsacker, who became the first president of the reunified Germany.

Chancellor Angel Merkel at the last campaign rally for the Christian Democratic Union in Munich on Friday.Credit…Thomas Kienzle/Agence France-Presse — Getty Images

Chancellor Angela Merkel will not immediately exit the political stage, although Sunday night’s vote saw her party suffer sweeping losses.

On Monday, she planned to carry out her regular duties throughout the day and attend a reception hosted by the Roman Catholic Church in Berlin in the evening.

Although Ms. Merkel, 67, did not run again for the seat she had held since the first reunified German Parliament was elected in 1990, until a new government is formed she will remain in office as head of the acting, or caretaker, government.

The inconclusive result of the vote means that it could be weeks, or months, before a new government is formed. Despite pledges from all parties to try to have a new chancellor in place by Christmas at the latest, there is still a chance that Ms. Merkel, as acting chancellor, could be making the annual New Year’s Eve address to the nation.

After the last election, in 2017, it took 171 days — or nearly six months — to form a new government.

Ms. Merkel announced in the fall of 2018 that she would not run again, and she gave up leadership of her party, the Christian Democratic Union. After that, her position as chancellor was weakened as members of the C.D.U. jockeyed to replace her. She had hoped to stay out of the election campaign, but as the conservative candidate, Armin Laschet, started to flounder, she made several appearances aimed at bolstering support for him.

She is expected to try to take a similarly hands-off approach to steering the caretaker government — if world events allow. The last two years of her fourth and final term in office have included the coronavirus pandemic, what she herself has called “apocalyptic” flooding in western Germany and the chaotic withdrawal from Afghanistan.

Once the new chancellor is sworn in, Ms. Merkel will vacate her office in the imposing concrete building that dominates Berlin’s government district for good.

What she will do next remains to be seen. In response to that question in repeated interviews, she has said that first and foremost she will take time off to reflect and reorient herself before making her next move.

“I will take a break and I will think about what really interests me, because in the past 16 years, I haven’t had the time to do that,” she said in July, after receiving an honorary doctorate from Johns Hopkins University.

“Then I will maybe read a bit, and then my eyes might close because I am tired and I will sleep a bit,” she said, with a smile. “And then we’ll see where I emerge.”

The lower house of Parliament in Berlin.Credit…Michele Tantussi/Reuters

What do a traffic light and the Jamaican flag have in common?

They are both phrases that will be heard a lot in the coming days, after a close finish between Social Democrats and Angela Merkel’s conservative Christian Democrats is forcing talks of possible coalitions.

In the weeks and months following yesterday’s election, the parties will try to form a coalition government that has a majority in the German Parliament. The winning party in the election will have the first chance to try to form that coalition, but if it doesn’t succeed the chance goes to the runner-up.

For the first time since the founding of the federal republic 72 years ago, it looks as though it will take at least three parties to form a stable government.

Here’s how things might play out:

Olaf Scholz, whose party won 25.7 percent of yesterdays vote is eyeing a Traffic Light Coalition ?. Its name derives from the parties that would be included, and the colors they are usually known by: the Social Democrats (red), the free market liberal Free Democrats (yellow) and the Greens (uh, green).

Armin Laschet, meanwhile, who led the conservative Christian Democrats (black) to the worst defeat in their history, thinks he can pull together a Jamaica Coalition ??, named after the black, green and yellow of the Jamaican flag. That bloc would consist of the conservatives, the Greens and the Free Democrats.

For the past eight years, the two big parties have governed Germany together in a “Grand Coalition,” but most political experts predict its unlikely they will repeat that constellation, though it would have the necessary majority support in parliament.

The Social Democrats and the Greens have governed Germany together before — a prosaically named “Red-Green coalition” was in power from 1998 until 2005 — and have signaled their willingness to work together again. But this time they don’t have the seats necessary to get a majority on their own.

Seeing their popularity slip, Merkel’s conservatives and much of the conservative media warned during their campaign that an ascendant Social Democrats would turn to the far-left party, Die Linke, or The Left, to round out their numbers. However, that party did so poorly during Sunday’s vote that a combination of the Social Democrats, Greens and The Left would fall short of a majority.

Protesters carrying a banner reading “Expropriate Deutsche Wohnen & Co.” at a demonstration this month in Berlin against rising rents.Credit…Christian Mang/Reuters

Communist rule ended more than three decades ago in eastern Germany, but in Berlin, fury over soaring housing costs has at least one socialist idea making a comeback.

In a referendum, Berliners voted on Sunday in favor of appropriating the property of large real estate companies. The initiative, “Expropriate Deutsche Wohnen & Co.,” named after one of the city’s biggest landlords, calls for seizing the property of any company with more than 3,000 apartments.

The measure, passed with 56 percent of the votes cast, or more than 1 million people, is not binding on Berlin’s Senate, which would have to pass a law putting it into force. Real estate companies are certain to oppose the measure as unconstitutional.

But the vote reflects the deep frustration among Berliners at the rise in rents and property prices, which have made the city increasingly unaffordable for middle- and low-income residents.

Organizers of the initiative argue that the expropriation would be legal, citing an article of the Constitution that allows the government to seize land, natural resources or means of production for the common good. (The provision does not mention buildings.)

Activists said they would put pressure on political leaders to implement the people’s will. “Disregarding the referendum would be a political scandal,” said Kalle Kunkel, a spokesman for the initiative, in a statement. “We will not give up until the socialization of housing corporations is a reality.”

Deutsche Wohnen owns more than 100,000 units in Berlin, according to the company’s website. Many were purchased from the government in the 1990s during a privatization drive.

The company said in a statement Monday that it respected the vote and would work with the city to increase the supply of affordable housing, and to avoid sharp rent increases or evictions. Expropriation “would be neither constitutional, nor financially feasible for Berlin,” Deutsche Wohnen said.

As Germany’s election results came into sharper focus on Monday, no party won a decisive majority, but the loser was clear: Chancellor Angela Merkel’s Christian Democrats.

After 16 years in power under Ms. Merkel’s leadership, they saw their share of the vote collapse by nearly nine points, garnering only 24.1 percent of the vote. It was the party’s worst showing in its history, and the election signaled the end of an era for Germany and for Europe.

The Social Democratic Party defeated Ms. Merkel’s Christian Democratic Union by 1.6 percentage points, according to preliminary official results reported early Monday. Its candidate, Olaf Scholz, insisted the party’s gain of five points from 2017 — giving them 25.7 percent of the vote — provided them a mandate to form the next government.

It will most likely take at least three parties to form a government, and both the Social Democrats and the Christian Democrats were planning to hold competing talks to do so.

Already Monday, Germany saw the political posturing begin, as the two parties sought to woo partners for a potential government. But the most important potential partners, the environmentalist Greens and the business-friendly Free Democrats, decided that they would first hold talks together.

Christian Lindner, the head of the Free Democrats, said his party and the Greens, which are the most polarized on key issues of taxes and renewable energy, needed to figure out whether they could find a “progressive center” on which to move ahead before holding talks with any further partners.

The process of forming a new government could take weeks if not months of haggling. That would leave Europe’s biggest democracy in a kind of limbo at a critical moment when the continent is still struggling to recover from the pandemic, and France — Germany’s partner at the core of Europe — faces divisive elections of its own next spring.

On Monday morning, Clement Beaune, France’s junior minister for European affairs, told France 2 television that Germany had prioritized “a form of moderation, of stability, of continuity.”

“It is in the French interest to quickly have a strong German government in place,” he said, expressing confidence that France and Germany would remain close partners, regardless of which coalition emerges. He said he saw the main parties as “committed, comfortable pro-Europeans.”

For over a decade, Ms. Merkel was not just chancellor of Germany but effectively also the leader of Europe. She steered her country and the continent through successive crises, and in the process helped Germany become Europe’s leading power for the first time since World War II.

Cheers erupted at the Social Democratic Party’s headquarters when the exit polls were announced early Sunday evening. A short while later, supporters clapped and chanted “Olaf! Olaf!” as Olaf Scholz, their candidate, took the stage to address the crowd.

“People checked the box for the S.P.D. because they want there to be a change of government in this country and because they want the next chancellor to be called Olaf Scholz,” he said.

The campaign proved to be the most volatile in decades. Armin Laschet, the candidate of Ms. Merkel’s Christian Democrats, was long seen as the front-runner until a series of blunders compounded by his own unpopularity eroded his party’s lead. Mr. Scholz had been counted out altogether before his steady persona led his party to a spectacular 10-point comeback. And the Greens, who briefly led the polls early on, fell short of expectations but recorded their best result ever.

Mr. Laschet appeared at his party headquarters an hour after the polls closed, declaring the outcome “unclear” and vowing to try to form a government even if his party came in second.

Armin Laschet, center, the chancellor candidate for the Christian Democratic Union, spoke Sunday night in Berlin.Credit…Pool photo by Clemens Bilan

The progressive, environmentalist Greens made significant gains as compared to the 2017 election but fell short of having a viable shot at the chancellery.

On the outer edge of the political spectrum, support for the far-right Alternative for Germany, or AfD, appeared roughly unchanged, while the Left party appeared to be hovering on the 5 percent threshold needed to win seats in Parliament.

Aurelien Breeden contributed reporting.

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