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As Chancellor Merkel's grip on power continues to look more and more fragile, Bild Zeitung reports that Germany’s Christian Social Union party will give her a two-week deadline to meet its demands for overhauling asylum policy.

If true, the reports would would be an unprecedented challenge to Merkel's authority and risks plunging the nation further into chaos, as Der Spiegel pulls no punches in explaining: "The German question... How do we deal with migrants? Endangers Merkel's chancellorship."

As Bloomberg reports, the executive of the Bavarian party - an ally in Merkel’s government - will pass a resolution Monday approving rebel Interior Minister Horst Seehofer’s plan to turn away more refugees at Germany’s borders, the Bild Zeitung reported, citing party aides. Merkel has two weeks to gain the support of EU partners or Seehofer will execute the order unilaterally, according to Bild.

If the report is true, Seehofer’s ultimatum would be intolerable and “outrageous,” said lawmaker Ingrid Arndt-Brauer from the Social Democrats -- also in Merkel’s government -- on the phone on Sunday. “You cannot do that to the Chancellor - relations between Merkel and Seehofer would seem beyond repair.” The SPD backs Merkel’s stance on reforming asylum rules.

Of course, the issue of how to deal with migrants is not just a German issue. Italy’s Foreign Affairs Minister Enzo Moavero Milanesi said in an interview in Corriere della Sera published Sunday:

“The issue of migrants is epic and Europe has remained detached for years about it,” said Milanesi.

But for now, as entertainiong as watching the French, Italian, and Spanish play hot potato with a boatful of migrants, the real strain on the heart of the eurozone is in Germany and here are five potential scenarios from Bloomberg on what could happen next:

Compromise

The two parties have managed to eke out a compromise after each previous conflict. Overtures could begin on Monday, when the CSU party executive meets in Munich. Seehofer could give Merkel what she wants: two weeks to forge bilateral accords with countries such as Italy and Greece to return registered asylum seekers.

Merkel could also give ground, as for example the newspaper Die Welt advocates. She could put forward another proposal to assuage the CSU that may yield a compromise. But if she caves in to the Bavarian demands as they stand, it would be an unprecedented loss of authority that would render her a lame duck leader.

No Compromise

In the absence of a face-saving deal, the real clash could come as early as Monday. That’s when Seehofer has indicated he will start to implement his plan at the border. As interior minister, Seehofer has the authority to do so, even in the face of Merkel’s rejection. The only way for the chancellor to forestall a unilateral decision by her minister would be to fire him. Sacking her top Bavarian ally would be a historic first. If it happens, it’s hard to see how the coalition continues.

Even if it doesn’t come to that and Merkel is given until the June 28-29 EU summit to reach bilateral agreements, it may only delayed the clash, since there is no guarantee she can win deals with other other EU states. She has already called the prospect ambitious.

Confidence vote

For a coalition to dissolve, the German constitution says the lower house of parliament, or Bundestag, has to call a vote of confidence. The CDU and CSU, with a combined 246 seats, and the SPD with 153, have a majority of 44 seats in the 709-seat Bundestag. Such a move would be the ultimate measure of support for Merkel as chancellor. Even if she is unable to rely on the CSU, or indeed all of her own party’s votes, on the specific issue of her stand on migration Merkel might be able to attract the support of the Greens, which have 67 seats.

Germany’s Sueddeutsche Zeitung said in an opinion piece on Friday that Merkel should short-circuit the squabbling and put her parliamentary support to the test with a confidence vote. It’s a tactic that her predecessor, Social Democrat Gerhard Schroeder, used to force through military support for the U.S. after the Sept. 11 attacks. He used it again in 2005 amid a party rebellion, and this time lost the confidence motion, forcing new elections.

Merkel resigns

Should the chancellor view her authority as irretrievably compromised, she could throw in the towel. The Bundestag would be forced to elect a new chancellor to replace her, most likely from the CDU. Unless the governing parties agree to continue the coalition under a new leader, Germany’s ninth chancellor since World War II would serve in a caretaker capacity through to a new election.

Split on the right

The CDU and the CSU are sister parties, with a joint parliamentary caucus and electoral program. Think of the CSU as the center-right’s Bavarian chapter -- the CDU operates in all of Germany’s 16 states except Bavaria.

So a breach would be drastic, but not unprecedented. In 1976, CSU chairman Franz-Josef Strauss called off the joint caucus, but the split was short-lived. For the Bavarians, going it alone would theoretically open a path for the CDU to campaign in Bavaria, weakening the CSU’s position.

A hoax tweet that rattled markets on Friday raised exactly that possibility. It presented a fake quote from the CDU state premier of Hesse, Volker Bouffier, as saying his party should prepare to set up a Bavarian chapter for the next national election. Merkel’s chief spokesman, Steffen Seibert, quickly stepped in to say the report was invented. “We should all remain calm,” he said.

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However it ends, the spat has laid bare the limits of Merkel's authority in a fractious government that took office in March after nearly six months of post-election haggling.