German Coalition Govt Collapses After Crisis Meetings; Chancellor Calls for Confidence Vote

Germany's political landscape faced a sudden shift after Chancellor Olaf Scholz dismissed Finance Minister Christian Lindner late at night following marathon crisis talks. Lindner, a member of the pro-business Free Democrats, was removed from his position, leading to the resignation of the three other Free Democrat ministers. This move effectively led to the collapse of the government coalition.

In an unexpected twist, however, Transport Minister Volker Wissing, also from the Free Democrats, withdrew his resignation on Thursday morning. After a discussion with Scholz, Wissing announced he would remain in office but leave the Free Democrat party.

Lindner will officially receive his dismissal certificate from President Frank-Walter Steinmeier later today, and a successor for his role is expected to be named soon. The posts of the research and justice ministers, who had also resigned, may be filled later today.

Following the political upheaval, Scholz declared he would seek a vote of confidence on January 15, potentially leading to an early election in March, a year ahead of schedule. He accused Lindner of breaching his trust by advocating for tax cuts benefiting top earners while proposing pension cuts for retirees.

With the coalition in disarray, Scholz’s left-leaning Social Democrats are now set to lead a minority government, partnering with the environmentalist Greens. To address the country's challenges, the Chancellor also reached out to Friedrich Merz, leader of the largest opposition party, the center-right Christian Democrats. However, Merz swiftly rejected the proposal to wait until January for the vote of confidence, calling for immediate action.

Merz emphasized that the government no longer held a majority in parliament and urged Scholz to call the vote right away, or at the latest by early next week, warning that an early election could be held as soon as January.

The government’s lack of a parliamentary majority will complicate efforts to pass crucial legislation, including filling a significant budget gap. The collapse of the coalition followed weeks of disagreements over how to revive Germany’s struggling economy. The Free Democrats opposed tax hikes and changes to Germany’s debt rules, while the Social Democrats and Greens called for more state investments and rejected proposed cuts to welfare programs.

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