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In a series of Tweets, Trump went on the attack against Merkel.

Meanwhile, in the EU, the German government and the Schengen Agreement of no border checks may both collapse. Eurointelligence comments.

On the Brink

  • The future on the German government now hangs on an improbable EU-level agreement on a reform of the Dublin regulation by June 29.
  • The relations between Angela Merkel and Horst Seehofer have reached an all-time low - we have surpassed the point at which an amicable solution is likely.
  • Behind closed doors, politicians are drawing up plans for new government coalitions or a possible CDU foray into Bavaria.

Over the weekend, the crisis took a turn for the worse. The two parties, CDU and CSU, met separately and are talking to each other through the media. The personal relationship between Merkel and Horst Seehofer, CSU chief, is irreparably ruined. He is quoted as having said twice during a meeting: "I can no longer work with that woman."

There were lots of articles speculating about a break in the union between the two parties, about the CDU competing in Bavaria, and even about the Greens replacing the CSU in the government. Süddeutsche has a good report this morning showing the sheer exasperation of the CDU's leadership. There is an increasing sense that this is personal. Seehofer wants Merkel out, which the CSU now regards as a necessary condition for a CSU absolute majority in the August elections in Bavaria.

The EU has not been able to agree a unified asylum system, but Merkel is now determined to set a deadline of June 29 for an EU-wide deal. Failing that, there could be bilateral deals, say between Germany and Italy, but those are equally difficult. In his FT column, Wolfgang Munchau says Greece would almost certainly demand debt relief, and Italy's demands would include changes to the fiscal rules, and a change in the ECB's mandate to include bond purchases. This is just another way for Markel to end her career.

The border countries, supported by Germany, want a binding EU quota. This is rejected by Austria, Hungary, Poland, Czechia and Slovakia. The last meeting of EU interior ministers brought no progress - except that Italy is now much more forceful in its demands than before. A qualified majority would be sufficient, but the European Commission is not sure whether this is even is possible, according to Schiltz. It would be a political miracle if Merkel were able to pull this off.

Our conclusion is that, if there is no deal on the reform of the Dublin regulation, the Schengen system of passport-free travel will no longer be sustainable. Like the eurozone, Schengen is another triumph of ambition over reality, and it is likely to remain in a permanent state of crisis. We will see more unilateral actions by member states to protect their borders without regard for the system as a whole. Unilateralism is also the euro's most dangerous enemy.

Some thoughts on the future of Europe

Horst Seehofer wants a functioning system to deal with asylum seekers. Emmanuel Macron is seeking reforms of eurozone governance. Alexis Tsipras demands debt relief. And they all want it now. Munchau's conclusion is that the age of Merkel is drawing to an end - and with that the age of procrastination and non-solutions.

Two Weeks to Deal

As I was writing this post, Politico reported Merkel, Seehofer Postpone Migration Showdown.

German Interior Minister Horst Seehofer said Monday he has agreed to give Chancellor Angela Merkel two weeks to find a solution to a dispute over migration policy that has threatened the future of the government.

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Why might Seehofer do this?

  1. He will not take as much blame if Merkel fails.
  2. He believes Merkel will fail anyway
  3. He fears the CDU will start campaigning in the state of Bavaria.
  4. He fears further rise of AfD

I vote for Some Combination of the above. No matter what the outcome Merkel has been weakened.

Peak Merkel

Munchau says the age of Merkel is drawing to an end. I propose, the "effective" end of Merkel happened years ago.

On October 18, 2015, In reference to Merkel's inane decision to unilaterally welcome refugees, I wrote Swamped By Stupidity; Peak Merkel

Merkel has not been effective since. Rather than admit mistakes, she kept insisting she was right. And she will continue to do so all the way out the door.

But France is standing up to her. So is Greece, Austria, Poland, the Czech Republic, Hungary, Italy, and her own decades-long coalition sister partner.

The reasons are not the same. Greece still wants debt relief. Merkel is at odds with Poland over its court system, and a whole block of states are Fed up with Merkel on immigration. French President Emmanuel Macron wants more Europe, totally at odds with CSU.

Germany's conflicts are too many, with too many countries, and they are now internal as well. Merkel's kick-the-can strategy failed.

She wants a "European" solution to immigration. But she should have thought about that before she "unilaterally" welcomed millions of migrants with open arms.

That's the irony of this mess.

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Also see, Eurozone Immigration Crisis 2.0 May Wreck Merkel's Grand Coalition

For a discussion of WWI similarities, please see Europe's Nationalism and Trump's Trade Policies Look Like WWI Prelude.

Mike "Mish" Shedlock