German Foreign Minister Frank-Walter Steinmeier sought to position his Social Democratic Party as the champion of state aid for ailing companies as he began his bid to oust Chancellor Angela Merkel at Sept. 27 national elections.
Steinmeier, whose efforts to rescue retailer Arcandor AG were rebuffed by Merkel after the government stepped in last month to help General Motors Corp.'s German Opel unit, said that the state must be prepared to act wherever jobs are at risk.
"Where a company has a real perspective and it makes sense to save it, then that's what we stand for," Steinmeier told a party convention in Berlin today. "Saving jobs is better than insolvency. It's better to finance employment than unemployment."
Germany, the world's biggest exporter, is suffering the worst recession in the 60-year history of the federal republic as the global crisis curbs demand for foreign sales that account for every third job. Steinmeier, bidding to mount a comeback from his party's worst electoral loss since World War II in a June 7 European vote, is gambling that he can appeal to voters looking to the state to temper rising joblessness.
"The core message here was that the SPD is the party of state aid," Karl-Rudolf Korte, a politics professor at the university of Duisburg Essen, said on Phoenix television. "This was a speech for the core supporters."
Top-Earner Taxes
A majority of the 500 Social Democratic delegates, meeting for probably the last convention before the election, backed a campaign program that includes higher taxes for top earners, a universal minimum wage and extended subsidies for workers threatened with unemployment.
The program also recommits to closing down all nuclear plants by about 2023 while building new coal-fired plants, and rules out a sale of Deutsche Bahn AG, the state-owned railway, for the next legislative period.
"The radical market policies that got us into this crisis can't be allowed to continue," Steinmeier told delegates. State help where needed "is what I stood for with Opel," he said. "That's perhaps what divides us from the CDU -- we will never tell a worker that he's not 'system-relevant."'
Merkel's Christian Democrats and the Social Democrats, coalition partners since 2005, are locked in a struggle to lure voters as the economy contracts by 6 percent this year and unemployment is set to rise by more than a million, according to government forecasts.
Credit Applications
To help companies struggling during the crisis, the coalition established a 500 billion-euro ($US700 billion) fund. A separate program run by KfW Group, the state-owned development bank, said June 12 it received 1318 loan applications for a total of 5.8 billion euros since it was set up in October.
Steinmeier, 53, who is also vice-chancellor, sought to identify himself with the search for an Opel investor. While he championed Magna International Inc.'s offer for Opel until it was accepted as the government's preferred bidder, his calls for financial help for Arcandor were rejected by Merkel and Economy Minister Karl-Theodor zu Guttenberg. Arcandor filed for insolvency June 9, jeopardizing 43,000 jobs.
Merkel, 54, in a June 11 interview with ZDF television, said that Opel "was a very special situation that, in my view, won't happen a second time."
'Burden the Taxpayer'
"We have to ask in every case 'did the company have trouble before the international financial crisis set in, or were these only caused by the international financial and economic crisis?"' Merkel said in a Web cast posted on her Internet site yesterday. "If there were difficulties before, paths such as insolvency have to be taken -- we can't burden the taxpayer with balancing out mistakes made by management."
Latest polls show the Christian Democrats leading the Social Democrats by between 10 points and 12 points. Support for Merkel's CDU rose 1 point to 37 percent, while the SPD fell 3 points to 25 percent, according to a poll by FG Wahlen for ZDF published June 12. The poll of 1,343 voters was conducted June 8-10. The margin of error is as much as 2.7 percentage points.
Ronald Pofalla, Christian Democratic general secretary, said that the winner of the SPD convention is Oskar Lafontaine, a former Social Democratic finance minister who quit and became leader of the anti-capitalist Left Party.
Lafontaine can "enjoy watching as his old party follows his program and bit by bit opens itself to a coalition with the Left at every level," Pofalla said in an e-mailed statement. Steinmeier rules out a national coalition with the Left.
Steinmeier's challenge to Merkel was endorsed in speeches by leading Social Democrats including Finance Minister Peer Steinbrueck. Former Chancellor Gerhard Schroeder, Steinmeier's political mentor, was in the audience.
Steinmeier "didn't shy from speaking up for a core SPD principle," Marlene Rupprecht, a party delegate who represents the town of Fuerth in Bavaria, said in an interview. "Where it's necessary the government must roll up its sleeves and help save jobs. If we don't stand for that, then what are we?"
