Tidal wave will not sweep Bonn off EU course

Date: 30/04/1998

German Chancellor Helmut Kohl heads for the euro summit in Brussels this weekend severely weakened by regional elections in Saxony-Anhalt which have confirmed his government's growing unpopularity. Thomas Klau reports

WITH a mere five months to go before elections to the Bundestag and only eight months remaining before the final leap into the euro, the Germans' determination to abandon the leader who brought them reunification and resolved to wean them off the deutschemark seems to be hardening.

The result of last weekend's regional elections in the eastern state of Saxony-Anhalt gave a stunningly clear confirmation of the deep unpopularity of Bonn's centre-right government coalition after 16 years in office.

The electoral débâcle of Helmut Kohl's Christian Democratic Union (CDU), which collected a dismal 22% of the vote, has delivered a further blow to the authority of a chancellor seen increasingly as yesterday's man, including by many in his own party.

While few observers seriously expect the CDU to risk changing horses in mid-stream by replacing Kohl as a chancellor-candidate in the September election, the growing despondency in the party's rank and file bodes ill for the coalition.

The Christian Democrats and their liberal allies the Free Democrats (FDP) will need all their fighting powers to resist the tidal wave of pre-electoral confidence which has engulfed the long-suffering Social Democrats (SPD).

For the first time in two decades, the SPD is being led into battle by a ruthless political pragmatist endowed with an unmistakable will to win and a seemingly total lack of ideological baggage.

Gerhard Schröder, a smartly-dressed and telegenic performer with a winning smile and a pleasant voice, has consistently avoided spelling out his political plans in public, preferring instead to extol the virtues of a hazy neue Mitte ('new centre') of the electorate whose undefined interests he promises his government would serve faithfully.

A careful analysis of the triumphs of Bill Clinton in the US and Tony Blair in the UK has convinced Schröder's political advisers that the present mood in western electorates speaks against clear policy announcements.

Instead, it favours an electoral campaign tailor-made around snappy sound bites designed to flatter and reassure the nation's middle-ground.

The present mood in Germany is swaying between frustration at the federal government's inability to cut red tape and boost employment, a somewhat conflicting desire for the preservation of the welfare state, and renewed angst about the future of the economy.

Yet while the aspiration to painless change might, in theory, be embodied by a candidate from any of the two big parties, the chancellor, after 16 years at the helm of government, finds it difficult to explain why his new cabinet would not suffer from the same inability to undertake swift reform as the present one.

Judging from the CDU and the liberal FDP's catastrophic results in the last two regional elections, the strategy pursued by the SPD's president Oskar Lafontaine - using the Social Democratic Länder majority in the upper chamber to block some of the government's key reform initiatives - seems to be paying off.

The electorate is laying the blame for the perceived reform log-jam at the feet of the federal government rather than at those of the SPD, and is increasingly eager for new faces in Bonn.

Europe's biggest structural reform of all - the switch to the euro - will probably turn out to be anything but a vote-getter for the coalition on 27 September. While voters have attached little credibility to past SPD electoral campaigns which flirted with euro-scepticism and have punished local party candidates for engaging in it, worried resentment at the prospect of giving up the deutschemark is widespread.

Nowhere is this truer than in the eastern part of the country. East Germans, many of whom saw the spread of the deutschemark as one of the most cherished prizes of the unification with the West, are angry at the prospect of giving up a precious currency after less than a decade.

The deep current of anti-EMU sentiment in Germany's eastern Länder is fuelled by the dire reality of record unemployment, fast approaching 20% of the workforce, which a growing number of economists and politicians say might get even worse in the first years of EMU.

Last weekend's elections in Saxony-Anhalt saw nearly a third of the votes go to the far-left Party of Democratic Socialism (PDS) and the far-right German People's Union (DVU) - two protest parties deeply opposed to the government's policy of greater European integration.

Persistently high unemployment in the former East Germany means that Kohl can no longer count on the electoral loyalty of eastern voters grateful for the chancellor's success in bringing them unification.

The increasing likelihood of a change of government in Bonn does not mean, however, that Germany's European policy would undergo a sea-change. While Schröder's approach to the EU is certainly less emotional and historically-minded than Kohl's, the SPD's approach to the world under EMU amounts to a forceful call for more rather than less integration.

Adopting a line closely resembling that of France's Socialist-led government, Germany's SPD has been arguing that the euro strengthens the need for minimum rates of taxation and social and environmental protection throughout the single-currency zone.

Without such harmonisation, said Lafontaine during the Bundestag's recent debate on the euro, the social cost of increased price transparency and competition in Europe would be unacceptably high.

Despite Schröder's marked preference for Blair over French Prime Minister Lionel Jospin as a political role-model, the similarity of the German and the French Socialists' analysis of the consequences of the euro means that the Franco-German axis should emerge as strong as ever, even if there is change of government in Bonn.

If anything, the EMU debate in the Bundestag and the Bundesrat has demonstrated impressively that, for all the misgivings among the population, Germany's political leadership remains remarkably unanimous in its commitment to further European integration.

With all the parliamentary parties - with the exception of the PDS - strongly supporting EMU, the debate has shown that Germany is likely to remain one of the most stable forces behind further European integration in the decade to come.

The cohesion of Germany's political class has also highlighted the comparative disarray of France's party political élites in the face of the double challenge of an unprecedented transfer of national sovereignty to EU institutions and the steady rise of the National Front.

The chaos among the French right in the wake of their disastrous result in the March regional elections has reopened all the right wing fault-lines on Europe, which the government, however, can do nothing to exploit.

France's gauche plurielle coalition is itself busy maintaining an uneasy truce on the issue, which deeply divides the government's rainbow cabinet of Socialists, Communists, Greens and left-of-centre nationalists.

Thus Germany, whatever the make-up of its federal government in the first years of EMU, seems to be better equipped than its most important European partner to deal with the reality of Europe's pending monetary and economic policy revolution.

Even under a new chancellor, and despite Schröder's past flirtation with a mild euro-scepticism, Germany should continue to deliver a stable and broadly integrationist policy course to its European partners.

Major feature.