For the first time since the interwar years, a German election has resulted in a truly hung parliament -- no one, least of all the party leaderships in Berlin, knows with any degree of certainty whether a stable governing coalition can be formed. Gerhard Schroeder's Social Democrats, down 20 percentage points in the polls just a few months ago, engineered a stunning comeback in the last few weeks, finishing a little less than one percentage point behind the CDU/CSU in Sunday's federal election.

First of all, a necessary caution about historical parallels. Although the media have been quick to use loaded terms like 'crisis' and 'chaos', the fact is that Berlin is not Weimar. Actually, Berlin is looking a lot more like Rome these days. Three decades ago, the Federal Republic was the epitome of the stable 'two and one-half' party system, in which power alternated between strong political parties of the left and right, mediated by a capable, small centrist coalition partner. Those idyllic days are long gone. The parliament resulting from this election will hold five political parties (six if you count the Bavarian CSU separately, which Bavarians typically do). And the numbers just do not add up to an obvious, stable governing majority. It must be kept firmly in mind, though, that if this is in fact chaos or crisis, it is one neatly confined to party elites.

So how did Germany get to this point? Angela Merkel, the chancellor candidate of the CDU/CSU, focused her election campaign on the economy, promising a more effective and far--ranging set of structural economic reforms than the Red--Green coalition had been able to produce in its seven years in power. She tapped Paul Kirchof, a law professor from Heidelberg University and a vocal advocate of radical tax reform, as her future finance minister, and Heinrich von Pierer, former CEO of Siemens, as her chief economic advisor. The rest is recent history. Chancellor Schroeder used a televised national debate with Merkel two weeks ago to launch a far--ranging critique of the conservative economic agenda, and placed Kirchoff and his radical writings at the center of debate. The SPD skillfully cast the choice facing voters as one between an ultra-liberal, market-based agenda and a kinder, gentler approach to structural reform. Voters, not surprisingly, opted for the Red--Green vision of social market economy (emphasis on social) rather than a center-right package that smacked too much of "Amerikanische Verhältnisse" (American conditions).

The ramifications of this election result are still taking shape. In all likelihood, neither Schroeder nor Merkel will succeed in becoming chancellor. Rather, an extended period of political improvisation, culminating in an early federal election, will follow. And -- alas -- this unsettled period will allow political drift in the European Union to continue unabated. Without a clear line and a clear lead from Berlin, the EU will not be able to overcome stalemate on enlargement (specifically, Turkish accession) and on a constitutional settlement. And without a more constructive and predictable German foreign policy, the transatlantic relationship will struggle to regain its pre--Iraq form. And so it goes -- the people of Germany have spoken, and it is now up to their democratically elected leaders to find a way forward.

Jeff Anderson is the Graf Goltz Professor and Director of Georgetown University's BMW Center for German and European Studies.