The last time Germany went to the polls, Wolfgang Clement was deputy head of the Social Democrats (SPD), and one of the most powerful figures in government: the “super minister” in charge of both economic and labour market policy, who had previously governed the SPD heartland of North-Rhine Westphalia, home to 18 million people.

 Four years on, Clement is urging the public to vote for one of the centre-left SPD’s most bitter rivals, the business-friendly Free Democrats (FDP).

 In a newspaper advertisment on Friday, Clement said he was backing FDP leader Guido Westerwelle in Sunday’s federal election.

 An admirer of Britain’s Margaret Thatcher, Westerwelle has branded the SPD socialists, and wants to end their 11 years in office to form a centre-right coalition with Chancellor Angela Merkel’s conservatives.

Though Clement had long had a fractious relationship with the left of the SPD, the endorsement was unprecedented, said Josef Schmid, a political scientist at the University of Tuebingen.

 ”The man is no fool but to act like this is just idiotic,” he said of Clement, a former journalist who spent nearly 40 years in the party. “I can remember nothing like it.”

 The 69-year-old Clement left the SPD last November after a row blew up over his criticism of the party in the state of Hesse.

 Yet despite overtures from the FDP, he said he would remain a “Social Democrat without party membership.”

 In the advert in Bonn’s General-Anzeiger, Clement said a vote for the FDP was a vote for economic prosperity and against the “irresponsible populism” of die Linke or Left Party, a far-left grouping led by ex-SPD chairman Oskar Lafontaine that has eaten into the Social Democrats’ traditional base.

 Uwe Andersen, a political scientist at the University of Bochum, said the move by Clement, who presided over the biggest postwar cuts to German jobless benefits, was symptomatic of lingering divisions between the left and centrist wings of the SPD.

 ”This is a real coup for the FDP though, and Westerwelle will try to make the most of it. It could spirit centrist voters away from the SPD. Then again, it could encourage some people who might have stayed at home to go out and vote for the SPD,” he said.

 Andersen said Clement’s decision was particularly shocking in a country where political allegiances have traditionally been set in stone.

 ”The ties here are more of a marriage for life than in the United States. But young people are getting fed up with it,” he said. “That’s why party membership of the main parties has been falling so dramatically.”

IMAGE:Outgoing German Economic Minister Wolfgang Clement of the Social Democrats (SPD) gestures during the inauguration of his successor Michael Glos of Bavaria’s Christian Social Union (CSU) in Berlin November 23, 2005. Clement handed over his duties to Glos following the inauguration of Angela Merkel as Germany’s first female chancellor on November 22. REUTERS/Wolfgang Rattay

Pressure? What Pressure?

That was German Chancellor Angela Merkel’s message during a 90-minute grilling in Berlin by journalists at her last major news conference before the Sept. 27 election. Even though opinion polls show a narrowing in her re-election campaign and amid a growing nervousness in her conservative party, Merkel was a picture of tranquillity.

Although some of her conservative party allies are pushing for her to raise the volume and intensity of what has been an exceedingly cautious campaign, Merkel made it abundantly clear that she is not at all worried. Perhaps it was all a good bit of acting. But she answered even the most surly of questions from the pack of 100 journalists with a nationwide TV audience watching with smiles and jokes along with the usual assortment of evasive answers.

Like she has so often in the last four years, Merkel managed to find a shimmer of optimism in just about every query hurled her way. She turned each question about opinion polls showing the lead of her preferred centre-right alliance narrowing upside down by pointing out the centre-right still has a lead.

“The opinion polls are quite encouraging for us,” Merkel said even though the centre-right’s lead over a trio of left-leaning parties has shrunk to just two points in two polls and disappeared into a dead heat in a third. Two weeks ago, the centre-right had a six- to eight-point lead in those same polls over the Social Democrats, Greens and Left party. Four years ago, Merkel’s centre-right alliance also had a big lead before the election that evaporated on election day. The conservatives are particularly nervous after having seen their support plunge in the final days of the last two campaigns in 2002 and 2005.

Merkel also skated over questions about her shaky performance in a TV debate on Sunday against her rival Frank-Walter Steinmeier, her decision to go on a long summer vacation last month rather than campaign and her trip to Pittsburgh late next week just before the vote to attend a G20 summit.

“I treated myself to a two-week holiday because I felt it was appropriate and important – so that I could be happy and available right up to the end of the election campaign,” she said at one point. “I actually was quite satisfied with my performance in the TV debate,” Merkel said, disagreeing with the view of even many in her party that Steinmeier got the upper hand because she took such a cautious approach.

“It’s pretty much always the case that there is certain unrest and tension in a party as the election nears,” she said, adding a somewhat ominous warning to those in her party who are causing a commotion: “I’m going keeping a close eye on what everyone’s been saying.“

PHOTO: Angela Merkel smiles during a news conference in Berlin. REUTERS/Tobias Schwarz

With two weeks to go before Germany holds an election, Chancellor Angela Merkel’s conservatives have unveiled a new set of election posters, depicting Merkel, Merkel, and more Merkel.

Rather than campaigning on the issues highlighted in their election programmes, the Christian Democrats (CDU) and their Bavarian sister party the Christian Social Union (CSU) are keeping it simple and hoping to capitalise instead on the popularity of their leader, Germany’s first female chancellor.

(Photo: A new election campaign poster of German Chancellor Merkel is pictured in Berlin, Sept. 14, 2009, Reuters/Fabrizio Bensch)

“The key question is whether Angela Merkel, who has intelligently guided Germany throughout the crisis, should continue to govern,” said Ronald Pofalla, general secretary of the CDU, at a press conference in Berlin.

“With the new posters, we want to make clear to people that they will only get Merkel again as a chancellor if they vote for the CDU.”

The posters show only Merkel, smiling benevolently against a minimalist black background, and feature slogans like: “We vote for the Chancellor” or “We vote for confidence”.

The latest posters are emblematic of the conservatives’ general campaign, which has focused less on hard-hitting issues such as tax cuts and atomic energy than on popular personalities like Merkel and the Economy Minister Karl Theodor zu Guttenberg.

On previous posters, Guttenberg and other well-known conservative politicians were shown against a blurry background, alongside vague slogans such as “economy with reason”, “strong families” and “good education”.

The posters contrast with those of other parties, which make strong statements on specific policies. A poster for the Social Democrats (SPD), the conservatives’ main challenger, shows an anonymous young woman and reads “atomic energy was yesterday, clean energy is the future, and that is why I am voting SPD”.

 With the election looming, the question is whether voters will let the conservatives get away with their refusal to engage on the issues and failure to offer a new vision for the future of Europe’s largest economy.

Analysts said Merkel did worse than her SPD challenger Frank-Walter Steinmeier in a television debate on Sunday — partly because she preferred to echo the vague slogans of her campaign rather than spell out what she plans to do if she is re-elected.

Is she smart to steer clear of controversy and rely on her popularity to win a second term, or could the strategy backfire on Sept. 27 as it did in the TV debate?

(Additional Reporting by Wolfgang Kerler)

Germany’s “cash-for-clunkers” scheme expired on Wednesday with a last-minute surge in demand a full three weeks before the Sept. 27 election and much faster than anyone thought possible.

It was among the 81-billion euro basket of stimulus measures the government put together to soften the impact of the recession and was later copied in many other countries, including the United States.It started out as a 1.5-billion euro scheme but that had to be quickly topped up in the spring as a frenzy swept the country.

It gave the economy an important glimmer of hope as gross domestic product contracted by a post-war record 3.5 percent in the first quarter. The government’s heavy-handed intervention did, however, disrupt the free markets — hitting the market for used cars and causing problems for retailers as we pointed out in this story in April.  

My colleague Paul Carrel pointed out in an analysis today that the “cash-for-clunkers” scheme helped private consumption in Europe’s biggest economy grow by 0.1 percent in the first half and without the scheme it would have declined 1.0 pecent compared to the first half of 2008.    

 

The Social Democrats led by Vice Chancellor Frank-Walter Steinmeier — pictured here on the left inspecting a new car as it rolls along on the assembly line — have claimed credit for the Abwrackpraemie, saying it was their idea that helped the car industry in Germany and elsewhere with the generous subsidies for new cars for those to junk their older vehicles. That may be the case but voters don’t seem to care: the SPD still trails Chancellor Angela Merkel’s conservatives by about 12 points in opinion polls. 

The pressing question now is: What will happen to the car market now? Will demand for cars collapse? Did the “cash-for-clunkers” scheme simply encourage would-be car buyers to pull forward their purchases? Will the market be sucked dry? Or did it help stimulate genuinely new demand from people who otherwise would have held onto their ageing vehicles? Will it prove to be a “Strohfeuer“, a flash in the pan?

 

 

 

PHOTOS: Top: Junk cars piled up at a scrap yard in Offenbach near Frankfurt,  REUTERS/Kai Pfaffenbach (GERMANY)

Lower: Steinmeier (2ndL) talks to an employee about the A3 production line during a visit to the German car manufacturer Audi in Ingolstadt. REUTERS/Michaela Rehle

 

 

 

Barack Obama might have unrivalled expertise about the U.S. electorate. But the American president showed he’s something of a fish out of water when it comes to the complex world of German politics — where the seeming winners sometimes end up losing and the losers can end up in power with the right alliance.

Obama recently told Germany’s conservative Chancellor Angela Merkel to stop worrying about the Sept. 27 election: “Ah, you’ve already won. I don’t know what you always worry about,” Obama told her in comments captured by a German TV camera at the White House as the two were on their way to a joint news conference.

Merkel looked surprised by his comments — she knows that she doesn’t have anything in the bag yet — even with what might appear to outsiders to be a comfortable 12- to 17-point lead in opinion polls over her main rivals, the Social Democrats, with just 7 weeks left before the election.

Why is that?

Because under Germany’s “fiendishly complex proportional system” , Merkel’s conservatives could beat her rival Frank-Walter Steinmeier’s SPD and still end up without the centre-right coalition they want — or even more dramatically they could win the vote but end up losing power completely.

(more…)

A technical fault at a German nuclear power station has thrown a spotlight on one of the few issues that divide the two main parties before September’s election — atomic energy.

But the anti-nuclear Social Democrats (SPD), who have shared power with Chancellor Angela Merkel’s conservatives since 2005, may be disappointed if they had hoped to win votes from it.

Merkel, forced to accept a phaseout of Germany’s atomic plants under its coalition deal with the SPD, is campaigning on extending the lifespan of nuclear plants which are deemed safe.

By contrast, the SPD is committed to the phaseout which it introduced in a previous alliance with the Greens, and Saturday’s failed restart at the ageing Kruemmel plant in northern Germany has galvanised some of its members into action.

The SPD, trailing Merkel’s conservative camp by more than 16 percentage points and at risk of losing its role in government, is trying to do all it can to mobilise its traditional supporters before the Sept. 27 vote.

SPD Environment Minister Sigmar Gabriel pounced on the incident, swiftly taking to the airwaves to push his case that the phaseout should be accelerated. And on Wednesday a Berlin newspaper was strategically leaked a government statement, albeit from 2006-07, which said safety standards at older plants like Kruemmel were not as high as at more modern reactors.

Germans have for decades nurtured an aversion to atomic energy, which supplies just under 30 percent of their power needs.

But as other European countries have started to revive nuclear, opinion has started to shift due mainly to higher energy prices and fears about supply. Pollsters say Germans are now pretty evenly split on whether to support a later decommissioning of plants.

In their campaign manifesto, conservatives argue nuclear is an important part of the energy mix, at least until renewable sources are fully commercially viable.

“If the SPD tries to make this a big election topic, it will not have much success. Public opinion is moving towards an acceptance of atomic energy,” said Klaus-Peter Schoeppner, head of Emnid pollsters.

The results of European Parliament election have caused deep concern in European Union candidate Turkey, where gains made by conservatives and some far-right parties have been read as a  clear win by the “No to Turkey” camp” and thus a blow to Ankara’s already troubled EU membership quest.

Trying to make a silk purse out of a sow’s ear, Turkish  Prime Minister Tayyip Erdogan dismissed the vote as a “futile effort by those who cannot digest Turkey’s enormity and strategic importance”. He said politicians who vilified Turkey to win votes in the short term would be judged by history.

Erdogan was probably referring to anti-immigration parties  that have openly campaigned against predominantly Muslim Turkey’s accession bid, among them the Dutch Freedom Party of  Geert Wilders who promised that Turkey would not join the  union: “Not in 10 years, not in a million years.”

But last week’s results certainly don’t bode well for Erdogan’s European dreams and come as pressure is mounting for Ankara to push ahead with long-delayed reforms.

The European Parliament has no power to make decisions on EU enlargement, but the European Commission is expected to bear in mind how people voted in the election when shaping policy over coming months. The European Parliament also publishes periodic assessments of progress in Turkey and has been critical in the past of Ankara’s record on human rights, freedom of expression and police mistreatment, to name a few areas.

So-called “friends of Turkey” such as Britain’s Gordon Brown, Spain’s Jose Luis Rodriguez Zapatero and Germany’s Social Democrats suffered significant defeats, deepening a sinking feeling in Ankara that it is being left alone to face the wolves.

Meanwhile, the European Commission in December will review its decision to freeze eight of 35 “chapters” — or membership areas — because of Turkey’s refusal to open its ports to Cypriot vessels.

Will France’s President Nicolas Sarkozy and German Chancellor Angela Merkel — who oppose full membership for Turkey and whose parties did well in the European Parliament vote — press for Turkey’s EU membership to be put on hold?

Are Turkey and the EU heading for a clash?  

Suddenly, the outlook has darkened for Chancellor Angela Merkel, thanks to Bavaria’s conservatives who suffered their worst result in half a century in a state vote on Sunday.

Merkel is used to riding high in polls and had looked to be cruising to re-election in a year’s time.

But the disaster in Bavaria, plus a clouded economic outlook due to financial crisis around the globe leave Merkel looking vulnerable and open to attack from within her conservative camp.

The prospect of a reinvigorated Social Democrat (SPD) party, with whom she shares power in a loveless coalition, under its new leadership is yet another headache.

Merkel’s enviable status as Germany’s most popular post-war chancellor isn’t helping her party which is languishing at around 37 percent in polls while the SPD, although weaker, is starting to make gains.

And the 17 percent slump in support for Bavaria’s Christian Social Union (CSU), sister party of Merkel’s Christian Democrats (CDU),  is part of a trend.

This year, conservatives have endured heavy losses in all four states that have held elections and lost their absolute majority in Hamburg as well as Bavaria. Within weeks, the CDU could also lose power in Hesse where the SPD is expected to clinch a deal to oust CDU state premier Roland Koch after a knife-edge result in a Janaury vote.

Another left-right “grand coalition” looks more likely than ever as Merkel relies on the CSU – which accounts for more than 20 percent of the conservative bloc in parliament — for power.

If, as usual, the CSU performs worse in federal elections than in the state vote, Merkel could face a struggle to form the coalition she wants — with the liberal Free Democrats.

Merkel, who as the female,  Protestant leader of a predominantly male, Catholic party, has always struggled to fit in, may face still more unrest within the conservative camp.

Already Christian Wulff, a top CDU figure and head of Lower Saxony, has laid the blame for Bavaria on Merkel, saying the losses were partly due to compromises struck by her coalition.

The chancellor may also have made a mistake in slapping down CSU demands for tax cuts as now she will face a more cantankerous CSU which is likely to push harder for those tax cuts and could block other reforms.

Bavarian conservatives probably have the worst behind them but Merkel may have the worst still to come.

German Chancellor Angela Merkel sent a clear “I told you so!” to the United States and Britain at the weekend, criticising them in unusually frank terms for resisting measures that might have contained the current financial crisis. The conservative leader of Europe’s largest economy reminded her partners that she had pushed for steps to boost the transparency of hedge funds during Germany’s presidency of the Group of Eight last year. ”We got things moving, but we didn’t get enough support, especially in the United States and Britain,” she told the Muenchner Merkur newspaper. Merkel expanded on her point in a speech in Austria, suggesting that both Washington and London were only now coming around to her view.

“It was said for a long time ‘Let the markets take care of themselves’ and that there is ‘no need for more transparency’…Today we are a step further because even America and Britain are saying ‘Yes, we need more transparency, we need better standards for the ratings agencies’.

Germany had made greater transparency a key theme of its rotating presidency of the G8, which includes the United States, Japan, Germany, Britain, France, Italy, Canada and Russia. Berlin had expressed fears that hedge funds could threaten the stability of the financial system through their heavy reliance on borrowing to finance risky trading strategies. But it ran into resistance from the United States and Britain, achieving little.

Whether Merkel’s G8 initiative could have averted or limited the current financial market crisis if it had been successful is certainly debatable. But reminding voters that she had sought to address the problem as early as last year could help Merkel score points on the domestic front ahead of a general election next year. Merkel’s Christian Democrats (CDU) rule in an uneasy grand coalition with the Social Democrats (SPD), and both sides have been trying to play up their own role as crisis manager in the current financial market turmoil.

Both Merkel and her SPD finance minister, Peer Steinbrueck, have tried to take credit for Germany’s efforts last year to agree better transparency rules for financial markets. SPD budget expert Carsten Schneider praised Steinbrueck’s efforts during Germany’s G8 presidency in a newspaper interview on Monday, adding: “At the time, the United States and Britain demonised every effort to agree more transparency and rules.”

As Germany’s election approaches, the “I told you so!” Berlin seemed to send to Washington and London on the weekend could turn into an “I told you so first!”-competition between Merkel’s CDU and her SPD rivals.