German Chancellor Angela Merkel yesterday defended her open door policy which led to the entry of one million refugees to Germany and the rise of the nationalist, anti-migrant party, Alternative for Germany (AfD).
Merkel's conservative CDU-CSU bloc has begun coalition talks with the pro-business Free Democrats (FDP) and the Greens but the parties have different views on a range of issues including migration, energy, taxation and Europe.
The AfD did particularly well in co-leader Frauke Petry's home region of Saxony, an east German state which borders Poland and the Czech Republic. When right wing candidate Norbert Hofer came within inches of overturning the ruling coalition, they had to throw together a new alliance and a far left, Green Party candidate, Alexander Van der Bellen, wound up becoming President.
Still, the AfD result should be looked at in context: 60% of AfD voters opted for the party as a form of protest, according to exit poll data. Contrast that with the National Party here that won 46 per cent, dropping only a point on its last election result but its prospects of a fourth term - which would be historic here too - await the decision of a party with just 7.5 per cent.
Speaking to the Tagesspiegel newspaper in Berlin, Josef Schuster, head of the Central Council of Jews in Germany, called the AfD a "party that agitates against minorities".
The Social Democratic Party attained 20.5 per cent of votes.
"Most people are wondering if Germany even exists as it once was". Luxembourg Foreign Minister Jean Asselborn said Nazis are back in the German parliament. Her husband, another senior AfD figure, is also leaving the party.
Many Germans see the rise of the AfD as a similar rejection of the status quo as votes for Brexit and Donald Trump past year.
On their side, the Social Democrats (SPD) had their poorest election results since 1949.
It wants Germany's liberal political asylum rules reframed to serve the national interest, a referendum on leaving the euro and returning to the Deutsche mark and economic sanctions on Russian Federation lifted.
"We think this country urgently needs political change, but we no longer consider our party in a position to take it in hand" after months of infighting, she said Tuesday.
The Social Democrats are likely to remain the chief opposition party, weakening the political impact of the AfD despite its third-place showing, said Sergey Lagodinsky, a political activist with the Green Party and member of the Berlin Jewish Community Council.