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On to the next one. Merkel (R) with Kramp-Karrenbauer. Photo: Gregor Fischer/picture alliance via Getty Images

Annegret Kramp-Karrenbauer’s resignation as chair of Germany’s Christian Democratic Union (CDU) was abrupt, but her fall as Angela Merkel’s heir apparent was inevitable.

Why it matters: The CDU has been longing for a different chancellor candidate throughout the short and bumpy tenure of Kramp-Karrenbauer, known as AKK, because of her blunders and the rise of the far-right Alternative for Germany (AfD). Now it can cut its losses and prepare for the 2021 election. 

Driving the news: AKK couldn’t seem to control CDU lawmakers in the former East German state of Thuringia, who broke a taboo by cooperating with the AfD to form a government.

  • Merkel felt the need to make a statement during an official visit to South Africa — she called the pact "unforgivable" — undermining AKK’s role as party leader and preceding her resignation back in Berlin.

The backstory: Before following in Merkel’s footsteps by being elected CDU chair in 2018, AKK was Minister President of the small state of Saarland for nearly seven years.

  • That wasn’t enough for the national stage, as became apparent when she made light of gender-neutral bathrooms and thought out loud about military intervention in Libya or abandoning Strasbourg as the seat of the EU Parliament.
  • The CDU has had a downward trend at the polls during AKK’s stint as party leader. It took a bruising during state elections in the former East Germany last fall and had a historically poor performance during EU parliamentary elections last May. 
  • AKK couldn't escape Merkel's shadow. An Insa poll last month had Merkel topping the list of Germany’s most popular politicians, even after 14 years as chancellor, while AKK couldn’t break the top ten. 

The big picture: Winning is more important to the CDU than loyalty. The center-right party has been losing votes on the right to the AfD and on the left to the Greens.

  • Some conservatives are relieved to have an opportunity to pick a leader who can fend off the AfD, which is now the largest opposition party in parliament and has seats in all 16 state legislatures.
  • The emergence of a strong party to the right of the CDU, something legendary Bavarian political boss Franz Josef Strauss warned against, has created a conundrum. The CDU must decide whether to continue on Merkel’s centrist course or to tack right. 
  • The left of the German political spectrum is just as fragmented. With six parties on the ballot in 2021 it will be a challenge to build a viable governing coalition, as the recent experience in Thuringia showed.

What to watch: Europe's biggest economic power will be preoccupied by domestic politics until it determines who will follow Merkel as chancellor.

  • That could be answered sooner rather than later. The next CDU chair might consider AKK’s experience and judge that the party can’t afford to have both a chancellor and a chancellor-in-waiting.

Go deeper: Putting Merkel's remarkable longevity in perspective

Sudha David-Wilp is a senior transatlantic fellow and deputy director of the German Marshall Fund’s Berlin office.

Go deeper

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Data: New York Federal Reserve Bank; Chart: Axios Visuals

Emerging anecdotal evidence shows just how hard the recent rise in COVID-19 cases hit businesses in early January — but that hasn't hurt some business leaders’ longer-term views on their companies' prospects.

Why it matters: Increasingly, the economic recovery has come in fits and starts that move in tandem with new peaks in cases. Look no further than the thousands of cancelled flights and shuttered Broadway theaters in the wake of the Omicron variant's spread over the last few months.

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The definition of what it means to be "fully vaccinated" is evolving even as the CDC has remained careful not to officially change it.

Why it matters: CDC officials have been balancing the job of convincing Americans who've already gotten two doses of the importance of boosters with getting many Americans who still need their first doses to get their shots at all.

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Small businesses see hiring as No. 1 worry

Illustration: Aïda Amer/Axios

Almost every small business owner in a Goldman Sachs survey is having trouble hiring — and two-thirds think the federal government has done too little to ease their hiring, supply-chain and inflation worries.

Why it matters: The Goldman Sachs research gives a vivid window into the continuing headwinds and hardship for entrepreneurs.

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