Angela Merkel gets boost

[HenryTo]

My own opinion is: It is time for Mr. Schroeder to go and give another party a chance. The ECB also needs to cut rates so as to be able to speed up reforms within the Euro Zone in general.
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German challenger gets boost

Sunday, October 2, 2005; Posted: 7:39 p.m. EDT (23:39 GMT)

DRESDEN, Germany (AP) -- Conservative challenger Angela Merkel's party gained a seat Sunday in the last remaining district in parliamentary balloting, boosting her chances of becoming Germany's first female chancellor and giving the party extra momentum in coalition talks to form a new government.

With all 260 electoral districts reporting, Andreas Laemmel from Merkel's Christian Democrats won the contest for a seat in Dresden with 37.0 percent over Marlies Volkmer from Chancellor Gerhard Schroeder's party with 32.1 percent.

While the outcome of the Dresden vote does not significantly alter the results of the September 18 election, the strength of an extra seat in parliament is expected to give the conservatives a psychological advantage heading into coalition talks, which have been stalled because both Merkel and Schroeder claim a mandate to be chancellor.

Roland Koch, the conservative governor of Hesse state, said the vote confirmed the Christian Democrats and their Bavaria-only sister party, the Christian Social Union, as the strongest group in parliament, should choose the next chancellor.

"I see it as a step toward stability that we need to explain to the Social Democrats to stick to the rules," Koch said. "I see it as a signal for Angela Merkel."

More than 72.1 percent of those eligible in this east German district had cast ballots, officials said just after polls closed at 6 p.m. (1600GMT).

The high turnout reflected how seriously the 219,000 registered voters here are taking balloting, which was delayed due to the death of a candidate during the election campaign.

Both Merkel and Schroeder have laid claim to the chancellorship, making exploratory talks over whether there is enough common ground between the two to form a so-called "grand coalition" difficult. The two were forced into the arrangement because neither won a majority.

Such a slow pace is frustrating other parties, such as the Free Democrats, who could also try to build a government with the conservatives if a grand coalition fails to coalesce.

"What can't be agreed upon in two weeks will not be any better in four weeks," Wolfgang Gerhardt, the parliamentary leader for the Free Democrats, said Sunday ahead of the Dresden vote.

He criticized current plans to end negotiations by the end of October at the earliest as being too late and not indicative of a government capable of bringing about badly needed reforms to create jobs and kick-start Germany's stuttering economy.

Free Democrats head Guido Westerwelle celebrated the preliminary result, saying it should convince Schroeder to drop his demand to be Germany's leader.

"It means that Mr. Schroeder must finally understand that his time is up," Westerwelle said.

A third candidate in Dresden, Katja Kipping of the Left Party, made up largely of former East Germany communists, trailed with 19.2 percent.

[HenryTo]

Looks like it is a done deal for the Christian Democrats. That being said, reforms would be very difficult to implement unless we see some real economic growth. Easier said than done:
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Schroeder in deal to step down: WSJ

By MarketWatch
Last Update: 1:45 AM ET Oct. 10, 2005

SAN FRANCISCO (MarketWatch) -- Chancellor Gerhard Schroeder is expected to resign and turn over Germany's government to Angela Merkel in a deal being finalized Monday by the nation's two major political parties, according to a media report.

Merkel would preside over a cabinet equally balanced between center-left and center-right ministers in a "grand coalition" formed after last month's indecisive elections in which neither Schroeder's Social Democrat party nor Merkel's Christian Democratic Union won enough seats in parliament to govern alone, The Wall Street Journal reported in its online edition. See Wall Street Journal story (subscription required).

The 61-year-old Schroeder is expected to ignore requests from members of his party to serve as foreign minister in the 51-year-old Merkel's cabinet and leave government, The Journal said. Schroeder has been chancellor since 1998.

Concrete policies will be hammered out in coalition talks that could start this week, The Journal said. The overall tendency is likely to be reminiscent of the overhaul of the welfare state and labor market that Schroeder began in 2003, The Journal reported.

Schroeder's "Red-Green" administration, which has governed the world's third-biggest national economy since 1998, brought together Social Democrats and Greens in an attempt to modernize Germany's economy while promoting social inclusion and environmentally friendly lifestyles, The Journal said.