German Chancellor Calls for Early Elections

[HenryTo]

Breaking news - after the Social Democrats suffered a crushing defeat in local elections in the North Rhine-Westphalia region - Germany's most populous region.
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BERLIN - Chancellor Gerhard Schroeder called Sunday for early elections this fall — a year ahead of time — after his party suffered a crushing defeat in Germany's most populous region, saying he lost the mandate he needs to fix the country's struggling economy.

A somber Schroeder made the announcement after his Social Democrats did far worse than expected in local elections in their former stronghold of North Rhine-Westphalia, which they had governed since 1966.

"With the bitter election results for my party in North Rhine-Westphalia, the political basis for the continuation of our work has been called into question," Schroeder said in a brief appearance at his headquarters. "For the continuation of the reforms, I believe clear support by the majority of Germans is essential."

Early elections would cut short by a year the second term he narrowly won in 2002, helped by his opposition to the U.S.-led war in Iraq. Schroeder became chancellor in 1998 by ousting long-serving conservative Chancellor Helmut Kohl.

Social Democrats have held power for 39 years in the western region of 18.1 million people, which includes the industrial Ruhr Valley. But this year, the party faced widespread discontent over surging unemployment — which stands at 12.1 percent, just above the national average of 12.0 percent.

Schroeder has pushed through limited trims in social welfare and unemployment benefits to cut costs for business and spur growth, but he has struggled to overcome resistance within his own party.

A fall poll would set up a confrontation with the conservative Christian Democrats and their allies, who have vowed a more pro-business approach while stressing their support for Germany's welfare state model. Recent polls have shown the Christian Democrats ahead nationally.

The Social Democrats took 37.1 percent of the vote Sunday, well behind the conservative opposition Christian Democrats' 44.8 percent, according to official results.

Projections by ARD television put both the Greens, the Social Democrats' partner in government, and the conservatives' allies, the Free Democrats, at 6.2 percent.

Schroeder's party has bled support in state elections over recent years. The Social Democrats governed 11 of Germany's 16 states in 1999, a year after he took office; Sunday's loss leaves the party with only five governors.

This year, Schroeder's coalition has faced a scandal over visa rules that allegedly let in criminals from the former Soviet Union — an issue that has hurt the popularity of Foreign Minister Joschka Fischer, a Green.

But by far the biggest problem has been growth that's too slow to dent unemployment. Germany emerged from three years of near-stagnation last year as growth reached 1.7 percent; however, economists say much stronger growth would be needed to put significant numbers of people back to work.

A jubilant Christian Democratic leader, Angela Merkel, celebrated her party's "sensational result" and indicated that she was open to early elections. She would likely be Schroeder's challenger for chancellor, although the opposition has not chosen its candidate.

Edmund Stoiber, the Bavarian governor who challenged Schroeder in 2002, said voters had decided that the Social Democrats and Greens "do not have the capability to reduce the problem that really interests Germany — unemployment."

Manfred Guellner, head of the Forsa polling agency, said the Social Democrats failed to motivate their supporters Sunday and argued that there was no obvious reason to think the party would perform better nationally this fall than it would 2006.

"These are policies that were not accepted in North Rhine-Westphalia," and the picture is similar nationally, he said.

[HenryTo]

A case study on how not to conduct a campaign - specifically pointing the finger at "Big Business" for the unemployment problem in Germany.
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Schröder's last bastion set to fall to the Right in state elections
By Tony Paterson in Hagen
(Filed: 15/05/2005)

The political meeting is packed, the auditorium in the down-at-heel city of Hagen is full and yet the only sound to be heard is of a spluttering, worn-out car engine that just won't spark into life.

A message suddenly flashes up on a large video screen in the hall: "After 39 years, it might be time to think about getting a new motor".

Juergen Ruettgers speaking at a Christian Social Union meeting
The audience - united in their distaste for the beleaguered German Chancellor, Gerhard Schröder - greets the election gimmick with laughter and rapturous applause.

For nearly 40 years, the ruling Social Democrats have been in power here in North Rhine Westphalia, the country's most populous state and long considered an unassailable bastion of the German Left. But after state elections next Sunday, that may change.

The opposition conservative Christian Democrats are busy writing off Mr Schröder's party as a hopeless non-starter in the knowledge that voters in North Rhine Westphalia are increasingly disenchanted with the Chancellor's economic policies.

The state is home to 1.1 million of Germany's five million jobless, unemployment is running at 15 per cent, about five per cent above the national average, and more than 12,000 companies have gone bankrupt in the past five years.

Such economic numbers make bleak reading for the Social Democrats, and the latest opinion polls put Mr Schröder's party 11 per cent adrift of its rivals.

At the Hagen rally, Angela Merkel, the leader of the Christian Democrats, received a standing ovation from the disillusioned audience of small businessmen, students and pensioners.

"The Social Democrats just can't deliver," declared Mrs Merkel, 46, who is bidding to become Germany's first female chancellor. "They've been in power for nearly 40 years and it's time for a change." Defeat for Mr Schröder's party at the hands of the state's 13.3 million voters would have dire implications for the future of the his "Red-Green" coalition of Social Democrats and Greens in Berlin, which faces a general election next year.

During Mr Schröder's seven-year tenure, the majority of Germany's 16 federal states have fallen to the conservatives.

North Rhine Westphalia is the only one still governed by a coalition which mirrors arrangements in Berlin.

Yet the state has been blighted by chronic unemployment, low growth, bloated bureaucracy and lack of investment - a collection of woes that, despite efforts to reform Germany's economy, has become the hallmark of the Schröder government.

Olaf Rotesic and his wife, Nicole, who run a job agency in Hagen, were among many at the rally last Wednesday who said that they would no longer vote Social Democrat.

"This country needs a Mrs Thatcher to shake things up," said Mr Rotesic. "Angela Merkel could just be the woman to do it."

Mrs Rotesic said: "I voted for Schröder once because I thought he had a strong personality and could get things done. But our firm has suffered since he has been in power - there are fewer and fewer jobs around for us to fill."

In a last-ditch attempt to rally traditional Left-wing support for next weekend's election, the Social Democrats resorted to an "anti-big business campaign".

The party has drawn up a controversial "locust list", a catalogue of companies which it "names and shames" for sacking employees en masse.

The strategy has infuriated business leaders. Dieter Hundt, the head of Germany's employers' association, said that the campaigns made him "want to vomit".

Perhaps more significantly for the embattled Mr Schröder, the locust campaign has also backfired in North Rhine Westphalia, where support among Social Democrat voters for the party has dropped since it was launched.

"Insulting firms across the board does not create a single job." Mrs Merkel told supporters in Hagen.

To ringing applause, she added: "The companies will simply go elsewhere."