German politics: A resigning matter

Date: 14/02/04

The chancellor gives up power in order to keep it

GERHARD SCHRÖDER, Germany's embattled chancellor, had threatened to resign so often that hardly anybody believed he ever would. But on February 6th he went ahead, at least partly: he will step down as chairman of the governing Social Democrats (SPD), handing the reins to Franz Müntefering, the party's parliamentary leader. Is this the beginning of the end of Mr Schröder's chancellorship?

After much of his Agenda 2010 structural-reform package became law at the start of the year, Mr Schröder had hoped that his government would enter calmer waters. He even launched an “innovation offensive” aimed at giving Germany back its competitive edge. But cabinet ministers committed one gaffe after another - such as threatening to fine households for paying their cleaning ladies cash-in-hand. Worse, voters started to feel the painful reforms, particularly health-care changes that have markedly raised patient charges.

As a result, the SPD is down to around 25% in the polls, which bodes ill for 13 regional and local elections due this year. SPD members are resigning in droves; some officials are refusing to campaign because they are sick of being yelled at. Unsurprisingly, hardly a day has passed recently without calls for a rethink of Agenda 2010, a reshuffling of the cabinet or even Mr Schröder's head.

To keep the discontent from turning into mutiny, Mr Schröder had to act. He did it by taking a page from the SPD's period in power in the late 1970s. Helmut Schmidt was the pragmatic chancellor; Willy Brandt took care of the social-democratic soul. Similarly, Mr Schröder wants to focus on being chancellor and giving his government more coherence. Mr Müntefering will try to stop the party's implosion, and win back disillusioned voters.

Mr Müntefering is the right choice because he is in many ways Mr Schröder's mirror image. While the chancellor can come across as arrogant, “Munte”, as he is affectionately called, is more humble. And whereas the chancellor rose to power against the party establishment, his 64-year-old successor is pure social-democratic bedrock. He has, at one time or another, held most big party positions. He played a key role in the 1998 campaign that brought the SPD back to power.

It is more questionable whether Mr Müntefering can persuade the SPD faithful of the wisdom of Agenda 2010. Yet here too, he seems to be the man for the job. Although he is only a recent convert to the need for structural reforms, he has done a better job than Mr Schröder of making the case for them. Yet to remain credible with the party, he will still somehow have to satisfy its left wing, which keeps calling for reforms to be more socially balanced.

Nobody actually expects the reforms to be rolled back, not least because the opposition, which has a majority in the upper house, would not agree. But the process could be slowed if the new SPD tandem leadership fails to work. As both parliamentary leader and party chairman, Mr Müntefering may be tempted to become more than the humble servant he is supposed to be. Yet he also knows that, when party leader and chancellor are out of step, the government tends to fall - just as it did under Mr Schmidt in 1982.

Even if the new twin leadership is a success, this will not guarantee any improvement in the polls. Much depends on whether Mr Schröder can deliver his part of the deal. He is likely to reshuffle his cabinet later this year. Weak performers, such as Hans Eichel, the finance minister, may go. Although Wolfgang Clement, the economics minister, is said to have opposed Mr Müntefering's promotion and even threatened to resign as SPD deputy chairman, he is likely to stay in both jobs.

Do not count Mr Schröder out, either. Not even the opposition expects him to step down, although some Christian Democrats have dutifully called for elections. Some are secretly relieved that Mr Schröder may have found a way to stop his party's free-fall, because their own camp is far from ready to take over. The opposition has yet to come up with coherent policies to reform the tax system or health care. Nor has it chosen its candidate for chancellor.

Mr Schröder is unlikely to throw in the towel, even if the SPD loses every election this year (as most expect, although it might yet win the tiny city-state of Hamburg on February 29th). The crunch will come in the May 2005 election in North Rhine-Westphalia, Germany's biggest state. If the opposition wins then, it will have a two-thirds majority in the upper house, enabling it to block almost everything the government tries. Then Mr Müntefering may even be called on to take over Mr Schröder's other job.

German Chancellor Shröder resigns as chairman of the Social Democrats (SPD)

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