The German electoral contest continues. Oh, the voting is over; the results have been accepted; it's just that they can't form a government. If you're not interested in the arcana of European parliamentary democracies, this election is still a little bit special. The narrow victory of Angela Merkel's Christian Democrats/Christian Social Union (CDU/CSU) over Gerhart Schroeder's Social Democrats virtually guarantees that Europe's largest economy will make a shift rightward, but by how much? This question underlies ongoing negotiations to form a ruling government and name a chancellor.

CNN's Chris Burns writes that Schroeder is fighting so hard to retain the chancellorship not for reasons of ego but for the very survival of the moderately leftish Social Democratic Party. The "market-oriented reforms" that were enacted under Schroeder lost the party enough support from its left wing (who defected to the Left Party) to cost it the majority in this election. The Left Party is now the fourth largest, having advanced over the Greens.

The struggle for Schroeder's party is not to cede too much to the Right and make itself irrelevant—

Political pundits and observers say that if the SPD caves too quickly to the conservatives' demands and are in effect co-opted in a grand coalition that takes them hostage, they could further lose their rank and file to the Linke, the Greens or other smaller parties.

And Judy Dempsey of the International Herald Tribune writes,

The Social Democrats are increasingly concerned that Schröder and Müntefering will cut a deal that could undermine Germany's generous social security system and introduce labor laws that would allow employers to hire and fire with greater ease.

"Any horse trading and haggling over people are completely unacceptable," said Ralf Stegener, the Social Democrat interior minister from Schleswig-Holstein, where Merkel's party won a dramatic election in March, forcing the Christian Democrats into a conservative-led coalition government.

Stegener warned Schröder not to compromise over workers' rights and the social market economy nor to reverse the party's policy over phasing out nuclear power.

"Of course every grand coalition has to make compromises, but not for a price that damages low earners but gives the managers what they want," Stegener said.

Likewise, the rightist CDU/CSU needs to show that it actually won something when it gained a majority in the election—

The Christian Democrats are becoming nervous, too, since they harbor the same concerns as the Social Democrats: Some fear that Merkel will give too much away to become chancellor.

Kurt Lauk, president of the Christian Democrats' economic council, said the grand coalition would have to tackle "big reforms," adding: "We have three big problems - the labor market, tax policy and the federal system. These are urgent. It is time to deal with the problems of the country."

Christian Wulff, state premier of Lower Saxony and one of Merkel's strongest rivals, repeated his warning that the Christian Democrats would compromise neither on the chancellor, who will be Merkel, nor on the president of the Bundestag, or Parliament.

Supposedly a deal is in the making that will be solidified Sunday night. The meeting is said to involve only four participants—Schroeder, Merkel, Edmund Stoiber, the head of the sister CSU party that supports Merkel, and Franz Müntefering, who heads Schroeder's Social Democrats. They say they'll let the world know on Monday.

And thus the course of Europe's most powerful democracy comes down to an agreement reached among just four people.

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