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Just days ago, Angela Merkel seemed a shoo-in for another term as leader of Europe’s most powerful country. Now, with the breakdown of talks on forming a coalition government, Germany is rudderless and the chancellor is facing perhaps the worst political crisis of her career.

Chancellor for the past 12 years, Ms Merkel helped steer the eurozone through years of financial turmoil and oversaw a long boom at home that reinforced Germany’s position as the continent’s economic powerhouse.

After last year’s Brexit vote and Donald Trump’s election as US president, the pastor’s daughter from the former Communist east was portrayed by some as a bastion of western liberal values in a world out of joint.

But all that was called into question after Christian Lindner, the young leader of Germany’s Free Democratic party, walked out of coalition negotiations with Ms Merkel and other leaders shortly before midnight on Sunday.

Suddenly the veteran chancellor — already weakened by her party’s worst election result since 1949 — seemed at risk of failing in the basic duty of providing a stable government for her 83m compatriots.

“I believe that the post-Merkel era has begun,” said Alexander Mitsch, leader of the Values Union, a conservative pressure group within the CDU. “Not only did she preside over that election debacle, she has also failed to form a government.”

While it was Mr Lindner who broke off talks, FDP politician Volker Wissing laid the blame for the breakdown squarely on the chancellor. “At no point in time did she succeed in giving the Jamaica coalition a common foundation,” he said. “Merkel has failed.”

Even before the rupture of negotiations, her halo had lost lustre, at least at home. Ms Merkel’s decision to allow in more than 1m refugees in 2015-16 was the most controversial of her time in office, denting support for her CDU/CSU bloc and contributing to her weak hand in the coalition talks.

Since the election, discontent has simmered. In the CDU’s grassroots, criticism of her leadership has grown, with some local functionaries openly calling for her to resign. Those demands could become louder.

Ms Merkel herself has other ideas. She told German TV on Monday evening she had never thought of stepping down — and would run again as chancellor if new elections were held. “I think Germany needs stability,” she said.

The crisis has few routes out. Ms Merkel can either try to renew her “grand coalition” with the left-of-centre Social Democrats, an option the SPD has expressly ruled out; she can try to lead a minority government; or she can push for new elections.

In all three scenarios, Mr Mitsch said, Ms Merkel has little chance of staying on as party leader and chancellor. “She’s just too tarnished,” he said.

For many, new elections are almost inevitable. A poll by Forsa found 45 per cent of voters were in favour, compared to 27 per cent who wanted a continuation of the grand coalition and 24 per cent who preferred a minority government.

Christian Lindner, leader of Germany’s Free Democratic party, walked out of Germany’s coalition negotiations on Sunday © AP

Yet few in Ms Merkel’s bloc relish the prospect: they worry they could end up with even less than the 32.9 per cent they won in September. A new poll could play into the hands of the rightwing nationalist Alternative for Germany, which has capitalised on growing voter fatigue with the status quo and in September entered the Bundestag for the first time.

Some think the CDU could do better if it dropped its pilot. But others disagree. “I think for the short- to medium-term she is irreplaceable,” said Jürgen Hardt, a leading CDU MP. “With her credibility and all her previous experience as chancellor she stands as a guarantee” for the whole German political system.

Part of her strength, Mr Hardt said, is the high regard in which she is held by the Greens, who would never agree to enter a CDU-led government without her. “I think none of our potential partners would accept anyone else as chancellor,” he said.

The Greens themselves seemed to echo that point. Jürgen Trittin, a senior Green leader, said he suspected that in quitting coalition talks Mr Lindner had wanted to weaken Ms Merkel, or drive her from power.

“But the way he did it could have the paradoxical effect that Ms Merkel comes out of this talks process strengthened . . . because she was seen as sensible and reliable,” he told German radio. “He wanted to topple her, and he has strengthened her.”

Christian Pestalozza, an expert in constitutional law at the Free University of Berlin, said Ms Merkel should remain chancellor whatever happens. “No one has more experience, no one is better at balancing competing interests, no one is more respected abroad,” he said.

Manfred Güllner, head of pollster Forsa, said 85 per cent of CDU supporters want her to stand again. “She still has very strong backing in her own party,” he said. “I don’t think she’s been weakened in any way.”

But the question is whether that backing still carries the necessary weight in the rest of the country to secure Ms Merkel her fourth term in office.

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