RAY SUAREZ: Confirming she'll become Germany's first female chancellor, conservative leader Angela Merkel was typically short on emotion and businesslike.
ANGELA MERKEL (Translated): I do feel good today, but a lot of work lies ahead of us. I want to take the choice the voters made and make the best for our country out of it.
RAY SUAREZ: Merkel's party had been expected to sweep last month's elections; she campaigned on a platform of market-oriented economic reform. But her Christian Democrats, known as the CDU, garnered only 35.2 percent of the vote. Chancellor Schroeder and the Social Democrats, or SPD, took 34.3 percent. CDU emerged with only a three-seat lead in the 614-seat Bundestag or lower house of Parliament.
After three weeks of negotiations, Merkel's party made a power-sharing deal with the Social Democrats. Schroeder is expected to leave politics after seven years in office.
The two parties made what they call a grand coalition, and Merkel reportedly had to bargain away several key cabinet posts, such as foreign and finance minister, to the Social Democrats.
Today she said the two parties were obliged to be successful.
ANGELA MERKEL (Translated): We all know that there's no realistic alternative to reforms for Germany, and that is evident. The politics of the grand coalition needs to ensure that jobs are being created again.
RAY SUAREZ: 51-year-old Merkel, daughter of a Lutheran pastor, grew up in Communist East Germany and was a scientist, uninvolved in politics until the fall of the Berlin Wall in 1989. She joined the Christian Democrats.
ANGELA MERKEL (Translated): If I'm a political product then I'm an East German product, a politician of the reunited Germany with roots in the East, and I'm proud of this.
RAY SUAREZ: Her rapid rise was pushed by her mentor, then Chancellor Helmut Kohl, Merkel served in two of his cabinets as minister for women and youth, and then as minister for the environment. As a Protestant from the East, Merkel broke the leadership mold in the CDU, a party traditionally dominated by Roman Catholic men. She became party leader in 2000.
Twice married with no children, Merkel's closely guarded private life is in stark contrast to that of Gerhard Schroeder whose four marriages have fueled lots of publicity. The coalition plan must be ratified by the members of both parties, and both houses of Germany's parliament, and the new government is supposed to be totally formed by Nov. 12.
For more about Germany's incoming chancellor and the challenges she faces, we turn to Dorothee Heisenberg, Associate Professor of European Studies at Johns Hopkins University. She's a native of Hamburg, Germany and now a U.S. citizen; and Jane Kramer, European correspondent for the New Yorker. She profiled Angela Merkel in the magazine's Sept. 19 edition.
Professor, the election was weeks ago. Why did it take so long for a chancellor to emerge from the process?
DOROTHEE HEISENBERG: Well, really there were two factors, one was you couldn't prejudge what the Dresden voters who had a late election were going to say it would have been hard to make a formal coalition before that, given how close -
RAY SUAREZ: -- the one last seat to be decided.
DOROTHEE HEISENBERG: That's right. And more importantly, the distribution was so close that most people felt that it was going to have to be a coalition between the two major parties in Germany, the CDU and the SPD, and that took a long time to iron out.
RAY SUAREZ: Well, there are some other smaller parties, which if either of the two bigs had decided to make an alliance with, they probably could have governed alone, right?
DOROTHEE HEISENBERG: That's correct. And what really skewed this election from a traditional perspective was the fact that the newly established Links Party which had broken off from the SPD, everyone had said they were not going to make a coalition with, and so therefore Schroeder wasn't able to govern as he might have if that party hadn't broken away or if anybody had said they would make a coalition with that party.
RAY SUAREZ: So the Christian Democrats and their Bavarian sister party win the election, get more votes than any other party. Why did they have to give up such powerful cabinet positions in order to form this coalition with a defeated Social Democratic Party?
DOROTHEE HEISENBERG: Well, again, they couldn't, I guess they could have made a minority government, but it would have been very ad hoc, and it's not something that would have been possible -- I think you needed to have this grand coalition so you would be able to pass legislation and move forward into, you know, not having the opposition of all of the parties, of all of the other remaining parties.
It's very hard to be a minority party, and as you said they only had 35 percent of the vote, so it would have been very difficult to just govern on their own.
RAY SUAREZ: Jane Kramer, a lot of firsts here, the first chancellor from the old East Germany, the first woman chancellor of the unified Germany. What kind of politician is Angela Merkel?
JANE KRAMER: Well, Angela Merkel to me is very much a product of her East German roots and her gender. She's quite suspicious of anyone not close to her. She grew up in the Communist East; that has left a mark in the way she plays politics. She is guarded; she plays close to the chest. She takes no prisoners; she is directed toward a goal, and she is highly suspicious of deals that can be betrayed, friends who could seek to supplant her.
She's to me quite a product of the East. And also as a woman, I think she played very shrewdly her rivals within her own party's perceptions of what her womanly virtues were. She was patient while they destroyed each other's candidacy. She was discreet; she fought her battles behind closed doors.
She was an immensely good and tidy housekeeper; they thought she was going to clean up the party; in fact she swept them away. She had no nostalgia for the old guard of the party.
And eventually they have come around, though it's quite evident that they are looking to eventually supplant her unless she turns out indeed to be what her publicity says of German Margaret Thatcher, it's quite unclear whether she has that endurance and whether she has that force.
RAY SUAREZ: Well, now, Jane Kramer, that the political season is over and it seems to be setting in to government, is what rank and file Germans see every day on television, in the way their politics are run, is Angela Merkel going to be a big departure from Gerhard Schroeder?
JANE KRAMER: I actually think the grand coalition is going to smooth many differences in the public perception. I think Gerhard Schroeder was clearly one of the reasons he called a new election and an early election when there is some chance that he could have weathered the course. Some of his reforms were kicking in and he might have stood a better chance in a year.
He was badly sabotaged by his own left wing, and Angela Merkel has been to some extent anyway sabotaged or at least unsupported by her own right wing.
In a way, a centrist left-right government, center left/center right, could stop in the best of all possible political scenes -- could stop the blackmail of extreme left and extreme right.
Germans also feared that this might in fact come to pass. So this is the big question: Will this group be able to operate because they can form a center, thereby withstanding pressures from the left and right, or will they be undone by the left and right -- by the radical reformers on the right and the radical anti-reformers on the left?
RAY SUAREZ: Well, Professor, this campaign as I understand it, was run heavily on domestic issues, but for people in the rest of the world looking from outside of Germany, for instance the United States, where there's been some testy relationships, is this is going to be a different German government to do business with?
DOROTHEE HEISENBERG: I do not foresee that. I think on many ways Angela Merkel is a new face to show up in Washington and so she can smooth over some of the feelings that were due to the Iraq war and some of the other things. But I think in general I do not expect a large difference in policy, foreign policy. And I think Americans should be happy if the Germans can get their economic house in order, because that would certainly provide better economy and better relations with the United States.
But on foreign policy issues I would not expect large differences between the Merkel government and the Schroeder governments that came before.
RAY SUAREZ: So the line on Angela Merkel during the summer that she was much more pro American than Gerhard Schroeder, there's not much to that in your view?
DOROTHEE HEISENBERG: Well, it's difficult to be overtly pro-American because a substantial proportion of Germans isn't feeling that friendly at the moment. And so it would be an unnecessary limb to climb out on for her. I think she, you know, will certainly be cordial, but I wouldn't expect massively different policy or new overtures with the Bush administration at least.
RAY SUAREZ: Well, you're from the New Yorker Magazine; did she have much to say to you that would indicate a different view toward the United States?
JANE KRAMER: A little bit, but I think mainly rhetorically. I think that just as Justice Schroeder, for instance, made no mention within Germany of the particular things that Germany was doing to not help but in some way aid America's war in Iraq. Angela Merkel makes very little mention in Germany of her hopes for rapprochement with the United States.
This is something we hear in foreign talks of hers. We heard it when she sent her foreign policy advisor to Washington to see the secretary of state and also to see George Bush. We heard it when she met with Tony Blair. The repercussions of this have not been felt inside Germany, and I don't think many people expect her. I think they expect an opening, but they don't expect considerable policy changes just impossible in the climate of Germany right now.
I think a lot will depend on who the foreign minister is also. I think I should add that the foreign ministry in German politics almost always goes to the coalition partner, and so it's not surprising that, and this is also the -- becomes the vice chancellor. So it's not surprising to me that the Social Democrats got that post -- some of the others perhaps, but that post was expected.
I think the influence of the foreign policy advisors on Merkel will be quite telling and it's very hard to see who is going to be ascendant there, her main advisor and only recent bitter rival, Mr. Scheibler, is very pro, a very strong relationship with the Americans now and even within this Bush moment. Certainly an SPD foreign minister will not be so enthusiastic about that. So it's a really wait and see game.
RAY SUAREZ: Jane Kramer, Professor Heisenberg, thank you both.
JANE KRAMER: Thank you, Ray.
DOROTHEE HEISENBERG: Thank you.