BERLIN, 24 September 2003 — Chancellor Gerhard Schroeder faces a revolt of left-wingers in his party after a bitter regional election defeat widely seen as a payback for government plans to prune Germany’s social welfare state. Schroeder’s Social Democrats (SPD) were crushed in Bavarian state elections by the Christian Social Union (CSU) which won 60.7 percent of the vote compared with an appalling 19.6 percent for the SPD. Adding a symbolic national thrust, the victor was incumbent Bavarian Premier Edmund Stoiber who was only narrowly defeated by Schroeder in last year’s German general election.
Furious SPD leftists immediately blamed the defeat on Schroeder’s “Agenda 2010” which aims to cut wage costs, eliminate rigid labor laws, raise state pension contributions, reform health care and cut taxes. “The SPD is no longer seen as competent in questions of (social) justice,” said Ottmar Schreiner, a leading SPD leftist in the party’s executive committee, adding: “It’s simply wrong to claim there’s no alternative to the Agenda 2010.” Said SPD leader of Hesse state, Andrea Ypsilanti: “One gets the impression that the German government has lost its social democratic mission.” The news magazine Focus said Schroeder has been bracing for an onslaught of tax-and-spend SPD leftists whom the chancellery privately dubs “the usual suspects”.
Among the group’s demands are tax increases for inheritance, stock profits, property, interest and rental income as well as a special tax on older cars. This clashes with Schroeder’s already approved tax cuts and badly dent the new public image he is trying to forge for the SPD. But the problem for Schroeder is that while his Berlin Parliament faction has only a rebel minority, the revolt now threatens to sweep through regional SPD groups in Germany’s 16 federal states who are out of power or fear losing power due to the government’s reforms. “Anyone who says we can just continue at the national level as in the past is accepting that the SPD will be incapable of winning a majority in Germany,” warned Florian Pronold, an SPD deputy in the Bavarian state parliament.
This, however, is exactly what the Chancellor intends to do. “We have no intention of changing anything in the Agenda 2010,” declared grim-looking Schroeder on Monday after admitting his party had suffered a bitter defeat. Most worrying for Schroeder are moves by his archenemy, Oskar Lafontaine, which may signal a bid for a political comeback. An SPD left-winger once dubbed by a British newspaper “the most dangerous man in Europe,” Lafontaine was SPD chairman when Schroeder was first elected as chancellor in 1998. Lafontaine was made finance minister in Schroeder’s first government but abruptly resigned all offices after only months in power amid claims he had been sidelined. The 60-year-old Lafontaine — who remains a political darling of Germany’s left — is said to be considering running to retake his old job as premier of the Saarland in state elections next year.
Such a move would clearly be aimed at putting Lafontaine in a position to be the SPD chancellor candidate in the next general election in 2006. This would be a direct challenge to Schroeder who earlier this month announced plans to run again. Lafontaine’s decision on a Saarland candidacy is expected by early November — shortly before an SPD party convention which may turn into a showdown between Schroeder’s reformist bloc and the party’s left-wingers. “If Lafontaine decides to run then the house will be on fire,” said a commentary in Hanover’s Neue Presse newspaper. The eloquent, anti-globalist Lafontaine seems buoyed both by Schroeder’s low popularity and Germany’s sickly economy which is stuck in a third year of stagnation.
Under Schroeder’s leadership the SPD earlier this year fell to its lowest-ever national approval rating and is currently at 26 percent, compared with 49 percent for the main opposition Christian Democratic alliance (CDU CSU). The economy is expected post zero growth this year after 0.6 percent growth in 2002. Unemployment is over 10 percent with 4.3 million jobless. Schroeder’s hope is that his tax cuts and reforms will kick in from next year fueling growth of at least 1.5 percent in 2004 and an even stronger economy in 2005 thus positioning him for a third election victory in 2006.
