Germany’s opposition: Maggie of Mecklenburg

Date: 25/10/03

Angela Merkel presses reforms on the Christian Democrats and Germany

A SPECTRE haunts Germany: of a handbag. Ever since Angela Merkel, leader of the opposition Christian Democrats, recast herself as a radical reformer, the talk has been of a new Margaret Thatcher. Britain's former prime minister gets more credit now than she did when she was in office in the 1980s, with some pundits calling for a German iron lady. Can Mrs Merkel be an Eiserne Dame?

This is no academic question. On October 17th, the lower house of parliament, the Bundestag, narrowly approved parts of Chancellor Gerhard Schröder's Agenda 2010 reforms. The fate of these reforms is now up to the opposition, which has a majority in the upper house, the Bundesrat. The Christian Democrats also look good for the next election, in 2006: recent polls give them twice as much support as Mr Schröder's Social Democrats.

The similarities between Baroness Thatcher and Mrs Merkel are striking. Both were unlikely politicians. Both started as students of natural science. Both became party leader against the will of the establishment, largely because their parties were in crisis and longing for a new face. Perhaps most important, both know when to take a risk, says Dominik Geppert, a historian, in his new book “Maggie Thatcher's Drastic Cure - a Recipe for Germany?” Baroness Thatcher did this in 1975, when she ran against Edward Heath for the Tory leadership. Mrs Merkel took a similar risk in 1999, when she was the first senior Christian Democrat openly to attack Helmut Kohl over the party-financing scandal that led to his resignation.

Recently, Mrs Merkel again showed courage by backing a health reform that would amount to a revolution in Germany's welfare state. She claims that the country is ready for fundamental change. All Germans, from chief executives to their drivers, should, Mrs Merkel says, pay a flat-rate health premium of some €264 ($310) a month. Households with low incomes would be subsidised out of income-tax revenues.

That may be where the parallels between the two ladies end. Baroness Thatcher plunged ahead with few hesitations, but Mrs Merkel allows herself to think things through - and even to have doubts. She points out too that critics are wrong to label her “neo-liberal”, saying that she is “deeply rooted” in the German social-market economy. Using taxes to finance a “social balance” in health care, for instance, would be more egalitarian than today's system, which people can opt out of after they get beyond a certain income.

What is more, British and German conservatives are different beasts. The Christian Democratic Union (CDU) is a Volkspartei, an inclusive people's party, with an influential left wing that is fighting Mrs Merkel's reforms. That, she says, is why a CDU chairman has to be “more subtle and sensitive” than a Tory leader. Yet her party has little choice but to accept reforms. Otherwise, back in power, it would find itself in the same state as the Social Democrats: politically unprepared for radical change.

Also, unlike the Tories, the CDU is a federalist party with powerful regional leaders. That makes it harder to impose changes. Mrs Merkel must deal with such rivals as Roland Koch, premier of Hesse. Even more dangerous is Edmund Stoiber, leader of the CDU's Bavarian sister party, who was recently triumphantly re-elected as Bavarian premier, and who wants a second shot at the chancellorship after losing to Mr Schröder in 2002. Mr Koch wants the opposition to block Agenda 2010; and Mr Stoiber has attacked Mrs Merkel's reforms.

Mr Stoiber's criticism is driven not only by power politics. Voters may not buy Mrs Merkel's plans, he argues, because they do not fit “the German mentality”. Germans, he says, do not want to know the cost of the welfare state, which would be clearer if more health care were financed by taxes. Mrs Merkel retorts that this mentality has to change - and political leadership is needed to push that change.

Mrs Merkel may never be a “Maggie of Mecklenburg”. But she is likely to be the CDU candidate for chancellor. If the party congress in early December approves her agenda, it will be hard for either Mr Stoiber or Mr Koch to stop her. Her plan to negotiate with Mr Schröder rather than to block his reforms may also help: the longer Mr Schröder stays in power, the less likely it is that Mr Stoiber will run again.

Yet there are risks. If Mr Schröder gets his reforms through, he may regain popularity, not least because the economy might pick itself up off the floor. And if he remains unpopular, he might be tempted to push even tougher reforms - doing much of the work that Mrs Merkel plans. Germany may then need not a Thatcher in 2006, but more of a Tony Blair. And that could mean Mr Schröder again.

The leader of the CDU, Angela Merkel, calls for reforms on the Christian Democrats and on Germany.

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