Government Denies Resignation Rumors

The surprising optimism following Wednesday's talks between Chancellor Gerhard Schröder's Social Democrats (SPD) and the opposition Christian Democrats (CDU) led by Angela Merkel has now been followed by further speculation about how the country will find a way out of its political paralysis. The rumor mill in Berlin is churning out speculation that Schröder would rescind his claims of being chancellor for a third term.

The Berlin-based tabloid B.Z. splashed the question on its front page: "Schröder Resignation on National Holiday -- Monday Last Day?" Politicians also believed that Schröder would soon resign so that a new German leader can finally be named.

"The necessary clarity can only mean one thing: Chancellor Gerhard Schröder will give up his duties," Michael Glos, parliamentary leader of the CDU sister party, the Christian Social Union (CSU), said on German public radio.

The answer from the chancellor's office was, as usual, also very clear: "Absolute nonsense and absolute rubbish."

Free Democrats odd man out

The grand coalition as the final solution to the inconclusive elections on September 18 became more and more likely after Angela Merkel and the Christian Democrats exited talks with their preferred partners, the free-market liberal Free Democrats (FDP) on Thursday.

"The possibility or likelihood of a coalition with the SPD is much higher than the other constellations," Merkel told reporters. In addition, she said there was a "very high possibility" of success of creating a coalition with the Social Democrats.

Guido Westerwelle, whose FDP came out as the surprise third-strongest party with almost 10 percent of the vote, thought that result would be more than enough to accompany the conservatives into power. But he now appears to be coming to terms with the likelihood that the FDP will remain in the opposition.

"It seems in all probability that we're heading for a grand coalition," he told reporters, adding that Schröder should now step aside for the good of the country.

"It would be right and appropriate to recognize that it's not about him or his personal career, but that it is about the fate of our country. He should not stand in the way of a new beginning any longer," Westerwelle said.

Economy Minister Wolfgang Clement however rejected accusations that Schröder wanted to remain chancellor for selfish reasons. He told reporters it is "completely incorrect to say it has to do with the personal ambitions of the chancellor." Rather, it had to do with how power would be shared in Germany and the demands of the Social Democrats.

The two sides have scheduled the next round of talks for October 5 -- three days after a district in the eastern city of Dresden goes to the polls in a by-election and two days after Germany's national holiday, which is being celebrated for the 15th time. And if the rumor mill in Berlin is correct, also two days after Gerhard Schröder's resignation.