"The definition of insanity is doing the same thing over and over and expecting different results."
—Benjamin Franklin
Thank you for the correct source for the quote.
Everybody here is very surprised that the CDU did so badly and that the SPD did so well.
The consensus seems to be that Kirchhof and his proposals for a flat tax was what crippled Merkel's campaign (as I said it would). The two parties are only about 1.5% apart.
I would think that a Grand Coalition between CDU and SPD is the only real option. Of the other three parties, the Greens are preparing to go into opposition and the Left party has been ruled out as a partner by both the SPD and the CDU (obviously).
Schröder seems to think he can continue as Chancellor, but that's only possible in a traffic-light coalition (Greens, Liberals and SPD). But FDP man Westerwelle has already said he wouldn't ally with the SPD (or will he? His party made massive gains, and then they go into the opposition?). That would be a massive act of betrayal of the CDU by the FDP, of course, but they've done it before.
This would mean the CDU, and the SPD as its junior partner, in a Grand Coalition. Both of them are interested in reforming the system, so they will doubtless arrive at some kind of compromise. However, if Schröder can't form a government as Chancellor on his terms, he won't be subordinate to Merkel in hers.
All very interesting. However, since the CDU is slightly ahead, Merkel has the first shot at forming a government.