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As leading German parties struggle to form a government after inconclusive national elections in September, there is optimism that whatever coalition emerges will make progress on one key issue -- the division of power between the federal government and German states. Earlier this year a bipartisan commission led by Bavarian Prime Minister Edmund Stoiber and Social Democratic Party Chairman Franz M?ntefering came close to agreeing to give states power to set their own policies on everything from shop opening hours to financing higher education. While talks continue in Berlin, the main parties are expected to form a coalition government led by Christian Democrat Angela Merkel. Since national leaders have had trouble agreeing on most basic reforms, it may help to delegate authority to more flexible state governments. EDITED BY Edited by Rose Brady