The growing ideological disputes over fiscal policy and EU integration in Germany's governing coalition provide a preview for not only the country's 2021 general election, but German domestic and foreign politics for at least the next half-decade. Germany's finance minister Olaf Scholz, who is a member of the center-left Social Democratic Party (SPD), recently said that the European Commission should be permanently allowed to issue debt on behalf of the 27 members of the European Union, and also suggested that Germany's constitutional debt brake, which was suspended earlier this year, should not be reintroduced in 2021. Scholz's partners in the center-right Christian Democratic Union (CDU) then criticized both statements, arguing the commission should only issue debt to pay for pandemic-related economic relief measures and requested Scholz present a plan to restore fiscal stability in Germany. 

The German government will become increasingly ineffective due to disputes between the CDU and the SPD, which will compete against each other in the next election. Germany must hold a general election by October 2021. The SPD has chosen Scholz as its candidate for the chancellorship, explaining why his recent statements do not align with his government's official positions. With Chancellor Angela Merkel (a CDU member) not seeking re-election, the CDU is expected to appoint a leader and likely chancellor candidate during a party congress in December. Some of the CDU candidates defend Merkel's centrist and pro-EU integration policies, while others want to take the party further to the right on issues such as immigration and are more skeptical of EU integration. Different opinions between the two parties on issues such as fiscal policy, immigration and EU integration will make it increasingly hard for Berlin to come up with a coherent policy. 

The general election will likely result in a fragmented parliament where a coalition of two or more parties is needed to form a government, which will impact Berlin's domestic policies as well as Germany's position on the future of EU integration. The CDU and the SPD have said they will not continue their coalition after the general election, which will force them to look for smaller allies to form a government, such as the Greens, the center-right Free Democratic Party and the left-wing Die Linke. This could result in a German government that is more right- or left-leaning than the current centrist coalition. Conservative parties such as the CDU and the FDP tend to defend preserving a fiscal balance at home and are skeptical of financial integration in the eurozone. Progressive parties by contrast, such as the SPD and the Greens, are more willing to increase public spending and support deeper financial and economic integration, as well as greater risk-sharing, within the eurozone.