Faith in Schröder evaporates as economy stagnates (HOLD MEIN BIER, GOTTERDAMMERUNG)

The Sunday Telegraph ^ | December 15, 2002 | Tony Paterson

[MadIvan]

Gerhard Bach was one of the thousands of German businessmen who had high hopes when Chancellor Gerhard Schröder's coalition of Social Democrats and Greens was swept to power for the first time four years ago on a promise of economic reform.

The 63-year-old director of the Wilhelm Faber construction company near Frankfurt was convinced that Mr Schröder's pledge to sweep away the bureaucracy, legal restrictions and high costs dogging his business would bring an end to the notorious "German disease" crippling the economy.

I read this and grinned. Then snickered. Then burst out laughing. - Ivan

Now, just two months after Mr Schröder's re-election last September, Mr Bach is bitterly disillusioned. "My company is currently facing its deepest crisis in 40 years," he said.

"We face the prospect of mass lay-offs next year as the result of economic stagnation. If anything the Schröder government has made matters worse."

Mr Bach's loss of faith in the administration is reflected across Germany. The Chancellor and his party have fallen from grace at a rate unprecedented in post-war German politics.

Since the ballot, the party has plummeted 11 points in the opinion polls to 27 per cent while the popularity of the opposition conservatives has risen to nearly 50 per cent.

Poll predictions indicate that the Social Democrats will be defeated in key regional elections in Lower Saxony and Hesse early next year. Even party supporters from Mr Schröder's home state of Lower Saxony are voicing open criticism. Defeat at the polls could bring down his coalition.

The Chancellor overcame a gaping Christian Democrat lead in the polls to win the September election after taking a stridently anti-American line in his opposition to war against Iraq, even if the United Nations backs action.

That issue has been rapidly eclipsed by economic stagnation, mass unemployment - which is predicted to rise nearly half a million to 4.5 million people by early next month - and a gaping £20 billion budget deficit.

Over the past four years, the German government's austerity programme has cut funds to regional governments and had a negative effect in the private sector. As a result the construction business is one of the worst hit areas of the economy. More than 700,000 workers have been made redundant in the sector since 1998.

"Business has just collapsed over the past four years. We simply aren't getting the contracts," said Mr Bach, whose company employs 500 workers. He also cites the plethora of government restrictions and social security obligations which mean that he faces some of the highest unit labour costs in Europe.

The crisis has provoked deep rifts within the Social Democrats. Left-wingers want to impose a wealth tax which is strictly opposed by Mr Schröder, while the trade unions are rebelling against the government's plans to extend shopping hours on a Saturday in an attempt to boost the economy.

Last week the bickering caused Mr Schröder's nerve to snap. At a party executive meeting in Berlin he threatened to resign as Chancellor. He said: "If anyone thinks they can do it better then let them."

A swathe of unpopular new taxes, social security and pension payments - the government's initial answer to the deficit problem - has provoked public outrage.

"It looks bad," said Jürgen Wunsche, a Social Democrat activist in Hanover for 30 years. "The voters are deserting us in droves and Berlin is to blame."

[MadIvan]

Socialism is to blame. It's failed everywhere else it's been tried, and it has failed in Germany too.

Auf wiedersehen, Gerhard.

Regards, Ivan

[MadIvan]

Bump!

[Petronski]

But he's a Socialist, and he cares so much. Isn't that enough?

[Sparta]

"Socialism is to blame. It's failed everywhere else it's been tried, and it has failed in Germany too."

Tell that to your countrymen and your jackass Prime Minister the good Comrade Blair.

[McGavin999]

Sheesh! They had the opportunity to fix this just last September but all they could think about was how compassionate old Gerhard looked when they were flooded. Yep, that fixes everything. Oh yeah, and don't forget how much good it does to the economy to slam the biggest consumer nation in the world too! That was really, really smart.

I don't feel even a little sorry for the German people (except those few who saw this coming). They had their chance a few months ago and made their own future.

[OldFriend]

Do you suppose they thought that if they just hated America then all their problems would be solved. If they just invited slick willie to a memorial at the Brandenburg Gate then all their problems would be solved.

Let them stew!

[MadIvan]

I predict there will be a change of government in the next year. A government this inept cannot survive - not even in Germany.

Regards, Ivan

[RobbyS]

I was in Germany when the counrt was united and thought that its economy would rake off. But the East sucked up hundreds of billions of marks and the Ossies proved incapable of functioning in a market economy. The Schroeder Government has pretty much done to Germany what the Attlee Government did to Britain.

[MadIvan]

The Schroeder Government has pretty much done to Germany what the Attlee Government did to Britain.

Britain's GDP per head has just passed Germany's as well. OK, that takes into account the poorer East Germany, but still.

Regards, Ivan

[OldFriend]

When Schroeder first came to power he tried to lower the taxes on corporations and the unions went mad. The entire system of taxation is so repressive that without massive change there will be no progress at all. Perhaps they might emulate Russia and try a flat tax.

[ricpic]

Eine kleine strudel mit schlag und koffee ischt gut......burp.

[You Dirty Rats]

In fairness to Schroeder (not that he deserves any), Germany's current problems have been building for a long time. Closer intergration of the EU (esp. the Euro), high wage costs, high taxes etc. would have eventually brought them trouble even without the East.

The current situation in Deutschland looks a lot like the "Winter of Discontent" in Britain (1978-9), except I don't see anyone in Germany who remotely resembles the Iron Lady. Bad luck for them; if they got their political / macroeconomic house in ordnung, they would still be far and away the richest, most productive country in Europe.

[ApesForEvolution]

2 tickets to the ballgame: $100
Parking: $20
Hot dogs, popcorn and drinks: $20
This..
"Last week the bickering caused Mr Schröder's nerve to snap. At a party executive meeting in Berlin he threatened to resign as Chancellor. He said: "If anyone thinks they can do it better then let them."

..is priceless.

[crystalk]

The Social Democrat dishonest worthless party ought to be SCRAPPED in Germany. Let the Marxist and Socialist elements, what are left of them, vote for the former Stalinists in the East German party that is still on the ballot.

What Germany needs is a lot more Ayn Rand, a lot more open society and libertarianism, send Greenspan or a deputy over there...

And yes, also a lot more Jesus Christ. A hundred years ago they gave up on Jesus Christ, 70 years ago they turned to Hitler as a substitute, and they still have no one to take His place, and it shows.

At this festive season, let them reconsecrate themselves to Jesus. Maybe we should send not just Ayn Randians, but Jerry Falwell, Billy Graham, and Pat Robertson as well!

PS/Yeah, I know, those two groups could get into some really good arguments.

/Germany needs to listen to both, they always seem to just want to go to sleep and withdraw in a quiet corner, lotsa luck.

[katana]

Ivan,

You know, for a race of people known for level headedness and hard work the Germans certainly have a penchant for making terrible political choices. Elected German politicians over the past 100 years include Adolph Hitler, Willi Brandt, and now a low grade hair dyed imbecile with the same name as the budding pianist in the Peanuts cartoon.

We (the English speaking world) have had our lapses as well (the names Wilson and Clinton come to mind) but the Germans' level of serial self delusion is stunning.

Meanwhile, for their betrayal of the west that for forty five years held off the Soviet bear, this economic collapse could not happen to a nicer bunch.

[AmishDude]

Shadenfreude bump!

[AmishDude]

"If anyone thinks they can do it better then let them."

Dear Moron Chancellor, granted I am not a German citizen, but I know how to do it better. Perhaps you ought to consult an Austrian named Hayek.

[ApesForEvolution]

"Dear Moron Chancellor, granted I am not a German citizen, but I know how to do it better. Perhaps you ought to consult an Austrian named Hayek."

If the Germans don't do something soon, we have to put up a new wall...around them.

[MadIvan]

If the Germans don't do something soon, we have to put up a new wall...around them.

We should resurrect the Holy Roman Empire, with Germany divided into dozens of little states. We need another Mad King Ludwig of Bavaria, who sent one of his subordinates to a grotto in Capri 3 times to ensure that a particular shade of blue for his castle matched a colour found in that grotto.

Regards, Ivan

[MadIvan]

Happygal is on the phone to me right now - she suggests that the wall be built and is hermetically sealed, so it becomes the world's largest open swimming pool. ;)

Not a bad idea, that. ;)

Regards, Ivan