Chancellor Merkel is passing the half way mark of her second term in office just at a moment when she seems to be in full control of her party, if not her coalition. At the CDU party convention this week in Leipzig, Merkel set the agenda and pushed all of it through, despite some mumbling on the margins.

Over six straight years as Chancellor, Angela Merkel has seen herself evolve into a party leader with a very different style than her predecessor, Helmut Kohl, who totally controlled his party and a sixteen year coalition. Her style is not dominating but directing, not commanding but consensus-building. She has evolved from the anti-Helmut Kohl figure following the CDU loss of power in 1998, to manager of a party’s return to a ruling coalition with the SPD in 1995 and then with the FDP in 2009. No other Chancellor was able to pull off back to back coalitions with two different political partners in the sixty plus years of the Federal Republic, another illustration of Merkel’s method of mediating through political rapids.

And of course, she is the first female Chancellor ever in German history, apart from the East German heritage which has gradually become less significant in her image.

Merkel’s milestones have much to do with the fate of her two coalition partners. The SPD, and now the FDP, have lost significant traction among German voters during the past six years, a trend which has not left her own party unscathed. The CDU has continually lost ground in several recent key state elections. As in the US, voters have lost trust in their representatives in Parliament.

However, the Chancellor has managed to maintain a level of personal popularity despite all the turbulence within the CDU, her two coalitions, in Germany and throughout Europe. Her position within the European Union is primus inter pares given Germany’s critically important role in the economic crisis. In fact, Merkel has evolved along with a united Germany in the last two decades to become the de facto leader of Europe, despite efforts to downplay that role along the way.

Merkel’s critics have been widespread, both in and outside of Germany. They take aim at what they see as hesitant reactions in dealing with Greece, the euro crisis, or what they perceive as kneejerk reactions, such as the quick turn around on nuclear power policy or conscription in the military. Recently, Helmut Kohl fired a broad side attack on the Chancellor’s foreign policy directions, claiming she has no compass when it comes to Europe or in transatlantic relations. That criticism might have stung coming from the old master. Where was she when it came to making the decision to abstain in last March’s Security Council vote on Libya, for example?

Yet, looking at the efforts Merkel has made in selling her policies on Europe and the Euro, her mantra has been pretty consistent with the theme of this past week’s party convention: a strong Europe, a strong Germany – in that order. Merkel defends her course as responding to changing circumstances and the range of choices she faces in dealing with them. Just as John Maynard Keynes once said about his views, “when the facts change, I change my mind.” Merkel follows a similar path, as she explained when she decided to shut down the nuclear reactors after Fukushima. And in the case of the euro crisis, she now defends her views on changing and correcting certain elements of the Lisbon Treaty in order to avoid more economic melt downs in the future. Furthermore, she is using all of Germany’s clout to make the argument. Some argue that she waited too long for certain decisions. She might respond that she needs to make those decisions with the domestic support required to make them stick, as well as within the hazardous waters of the EU’s complicated and sluggish decision-making framework.

No Chancellor is going to avoid criticism, whatever the decisions at stake are. Yet the style of Merkel’s steering through the white water of politics leaves her upright and intact – so far. Compare that with Italy, Greece and even France, and she looks pretty good.

For now, and that means in the coming new year, Merkel has a firm grip on her position within her party, within Germany and within Europe. There is only one state election next year – in Schleswig-Holstein – and its outcome will not make much of a difference in the political environment of 2012. Merkel will face a much larger set of tests in the following year leading up to the federal elections in the fall of 2013.

By then, she may be looking at a continuing weak coalition partner in the FDP, perhaps without the capacity to form another coalition. The implosion of the Free Democrats since the 2009 elections has been dramatic. A party that has been in ruling government coalitions for forty two of the sixty two years since the founding of the Federal Republic in 1949 is facing severe questions about its survival.

Merkel may also be looking at a potentially strong challenge from the Social Democrats in either of her former coalition partners Peer Steinbrueck or Frank Walter Steinmeier. Both stand as the potential SPD candidate to run against Merkel, with the idea of forming a coalition with the Greens again. It would be indeed ironic if the results of such a race put the old CDU/CSU–SPD coalition idea back in play. But that will depend, in part, on the ability of the Greens to maintain their own momentum, which they have enjoyed in several recent state elections, to offer a viable partnership with the SPD apart from the capacity of the Social Democrats to increase their appeal.

The outcome of such a race is too far down the road to predict now. But it will be a race for Merkel to face, as there is no one else to challenge her in the CDU. Despite some criticisms, the post-Merkel CDU phase will take a while to emerge. Some of the potential successors on that future stage were in Leipzig this week. But they were backstage – for now.

In the meantime, there will be other elections in 2012 in the US, France, and in Russia, along with the new leadership emerging now in Greece and Italy. While Russia can apparently be certain of the outcome of its elections, there is no clear certainty now about the results in either Paris or Washington DC, nor about the viability of new leadership elsewhere in Europe.

For the next two years, Merkel will remain a key player and partner for the figures emerging from all those races, both new and old. And with so much at stake in Europe’s uncertain future – and therefore for the US – Merkel’s momentum may be seen as critical. While she may not duplicate Helmut Kohl’s record breaking sixteen year run as Chancellor, Merkel has a good shot at a third term, and she has confirmed she wants to make a run.

Unforeseen events can shape the destiny of such ambitions. Helmut Kohl was on very wobbly legs in his second term at the end of the eighties – and then the Berlin Wall fell and he became Chancellor of a united Germany in 1990. All the while, Angela Merkel was standing somewhere on a backstage in Berlin. As the old saying goes – life is what happens when you are making other plans.