Let battle commence

Aug 22nd 2005
From The Economist Global Agenda

Gerhard Schröder may still be the loser in next month’s election in Germany—but it is no longer so certain that Angela Merkel, the opposition Christian Democrats’ candidate, will be the winner

IS THIS really the look of a loser? Stumping in Dresden last week, with the Semper Opera behind him and more than 5,000 spectators in front, Chancellor Gerhard Schröder was not just going through the motions. “We have to reform our welfare state”, he thundered, “or it won’t be there for future generations.” Surprisingly, he got more cheers than boos.

Meanwhile, in the square in Chemnitz, an hour’s drive west of Dresden, the crowd of some 3,000 was more excited. But Angela Merkel, the leader of the Christian Democrats (CDU), seemed strangely defensive. Instead of giving a broad outline of her policies, she got bogged down in details: her planned two-point increase in value-added tax (VAT) won’t raise prices across the board because rents, for instance, would be exempt.

In short, as Germany’s election campaign began in earnest last week, it was Mr Schröder who was regaining his old spark, while Ms Merkel was looking weaker. The CDU and its Bavarian sister party, the Christian Social Union (CSU), are bickering. The new Left Party remains strong—it is even appealing to far-right voters. Meanwhile, heavyweights in the chancellor’s Social Democratic Party (SPD) are jostling for jobs in a putative grand coalition led by the CDU.

It was always likely that the poll ratings for both Ms Merkel and her party, which hit record highs in late May, would fall. But nobody expected her campaign to get off to such a bad start. Of her programme, voters mainly recalled the plan to increase VAT, which they dislike. Ms Merkel then said that, because of the short campaign—the election is scheduled for September 18th—there was time for only one televised debate with Mr Schröder, giving the impression that she is afraid of him. And in an interview, she confused gross and net salaries, damaging for a politician who prides herself on detail.

Yet these mishaps are negligible compared with the harm done by Edmund Stoiber, leader of the CSU. Out of the blue, he started bashing eastern Germans, saying he could not let the east decide Germany’s future. “Unfortunately”, he added, “the population is not everywhere as smart as in Bavaria.” Some pundits suggest that Mr Stoiber has still not come to terms with losing to Mr Schröder in the 2002 election. Others argue that he is simply trying to maximise votes in Bavaria, which would increase his influence in a new government. Mr Stoiber’s attacks seem sure to cost the CDU votes in the east, and maybe in the west as well, because people will worry that there will be further infighting if the conservatives win power.

On Wednesday August 17th Ms Merkel tried to turn the tide with the announcement of a “competence team”, or shadow cabinet. Putting it together was not easy, not least because Mr Stoiber has not said what job, if any, he wants. And the choice of Paul Kirchhof, a former judge on the Constitutional Court, for the finance portfolio may turn out to be not such a good idea. He is a tax expert who favours radical reform, but he has no experience as a politician and his views are at odds with the CDU’s programme, not least the plan to raise the rate of VAT.

The biggest influence on the election, though, will be neither Ms Merkel’s campaign gaffes nor Mr Stoiber’s antics, but the performance of the new Left Party. Before the party was formed from disaffected former Social Democrats in the west, plus the east’s ex-communists, Ms Merkel and her would-be coalition partner, the Free Democrats (FDP), were confident of a clear majority over the outgoing SPD/Green coalition, which had lost much leftist support. Now, these homeless leftists have found a new harbour, forcing Ms Merkel to overcome a fully mobilised left.

Yet this does not fully explain the Left Party’s 10%-plus poll rating. It is the party of choice for losers from the unification of East and West Germany, and those who think they are suffering from globalisation. But it is also attracting voters who have lost faith in economic reform and in all the mainstream parties. More than two-thirds of the party’s potential supporters do not expect any of its programme to be implemented, but most hope it will influence the other parties.

The Left Party may yet win less than 10%. After its novelty wears off, its supporters could discover that it is more populist than truly left-wing. Its joint leader, Oskar Lafontaine, once finance minister under Mr Schröder, excels as a simplifier. When introducing his party’s programme, he called for German soldiers to leave Afghanistan to lower the risk of terrorist attacks in Germany. He has also used vocabulary that is usually reserved for the extreme right. Indeed, thanks to the strength of the Left Party, the neo-Nazi National Democrats seem now to have little hope of crossing the 5% threshold for getting into parliament.

With Ms Merkel weakened, Mr Stoiber sabotaging her and Mr Lafontaine losing credibility, Mr Schröder is starting to look better. As a formidable campaigner and proven media charmer, he was always likely to improve his opinion-poll ratings. But this is not a recovery like 2002’s, when he came from behind to defeat Mr Stoiber. Tellingly, the media are treating him as if he were on a valedictory tour. Even his remarks about not using military force against Iran have caused less stir in Germany than outside (partly because Ms Merkel essentially agrees with him).

More than anything, it is the battle within the SPD over top jobs in a grand coalition that underscores Mr Schröder’s status as a lame duck. Peer Steinbrück, a former premier of North Rhine-Westphalia, and Günter Verheugen, a vice-president of the European Commission, are talked of for the economics and foreign ministries, respectively. At the weekend, the SPD's chairman, Franz Müntefering, said that the party would consider a grand coalition with the CDU if it loses the election—thus distancing himself from Mr Schröder, who has regularly dismissed such talk.

In the weeks ahead some clarity may emerge. Polls will help to assess the damage done by Mr Stoiber: one taken after his remarks suggested that he has hurt Ms Merkel, but not her party; and the latest polls give the CDU/CSU and FDP a slender majority. The Constitutional Court still has to rule on whether the election should go ahead, since the chancellor called it after engineering his own defeat in a confidence motion, to the anger of some parliamentarians. (After a hearing earlier this month, most observers believe that the judges will acquiesce.) And on September 4th, Ms Merkel and Mr Schröder will hold their televised debate.

This debate will shift the campaign into top gear. Almost half the voters, say some polls, will make up their minds only in the final two weeks. The sole certainty now is that the CDU will end up with the most votes (over 40%), so Ms Merkel remains likely to become Germany’s first female chancellor. But whether she will govern with the FDP, which, like the Greens, is stuck at around 7-8%, or be forced into an uncomfortable grand coalition with the SPD, is anybody’s guess.

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