CDU chancellor battletakes shape

2 December 2003

LEIPZIG – Signs have emerged at Germany’s Christian Democrats’ annual congress in Leipzig that the battle for the opposition’s chancellor candidate for the 2006 election is already starting to take shape.

While the main opposition CDU swung its support Monday behind its leader, Angela Merkel, as she positions herself to run for chancellor against Gerhard Schroeder in the next national election the congress heard Tuesday from another possible contender for the chancellor candidate post, Bavarian Premier Edmund Stoiber.

In a speech to the congress, Stoiber, who heads up the CDU’s Bavarian-based associate party, the Christian Social Union, hit out Chancellor Gerhard Schroeder’s plan to bring forward planned tax cuts next year without cutting state spending, saying that the country faced its worst crisis since World War II.

Stoiber also sharply criticised Berlin’s defiance of eurozone deficit rules claiming they would fuel inflation and harm relations between big and small countries in the European Union.

Schroeder’s narrowly beat Stoiber in last year’s national election when the Bavarian Premier was chosen as the opposition’s standard bearer in the poll.

Many analysts believe that Stoiber would like to try again to unseat Schroeder and his Social Democrat-led coalition government in the election set down for 2006.

The party also approved Tuesday a plan, drawn up by a leading opposition spokesman Friedrich Merz, for a radical streamlining of the nation’s lumbering tax system and to lower the tax scales to 12, 24 and 36 per cent.

This followed the unveiling at the party congress Monday of proposal for a dramatic restructuring of Germany’s deficit-hit welfare state, including a new health insurance system.

Under the CDU plan, Germans would have to pay a flat rate of contributions to healthcare funds.

Both the tax and welfare plans are seen as opening shots for the 2006 election campaign.

Schroeder’s Social Democrats are also seeking similar changes in welfare so as to reduce the payroll levies that employers say are the principal deterrent to creating jobs.

Merkel’s keynote speech Monday won her a standing ovation with her supporters saying it demonstrated her oratory skills and a command of policy, consequently proving she was ready to run against Schroeder.

In her speech, Merkel also called for an end to friction with the CSU. “The CDU needs a strong CSU, the CSU needs a strong CDU, and together we make a union of strength,” she said.

Criticising the German stance on the eurozone stability pact, Stoiber told the CDU congress: “There is more damage to Europe from this than can be imagined.”

Germany and France last week forced through what analysts say is the death of the euro stability pact which threatened massive fines for countries overshooting a budget deficit of 3 percent of GDP.

Berlin and Paris, which will both break this budget ceiling for the third consecutive year in 2004, convinced a majority of EU finance ministers to block any moves to impose sanctions.

Stoiber described this as “unscrupulous” even if it could be argued that the deficit limits were “stupid” as has European Commission President Romano Prodi. “You need firm rules,” said Stoiber.

He said Schroeder’s plan to bring forward planned tax cuts next year without cutting state spending would further increase German public debt due to hit EUR93.4 billion for this year.

DPA and Expatica News 2003
Subject: German news