Monday, 17 December, 2018

Merkel under fire from own ranks over German coalition deal

Germany Has A Government Again - If The Voters Approve It Germany's Social Democrats Trade Credibility for Power
Ellis Copeland | 09 February, 2018, 02:19

The deal would see Chancellor Angela Merkel's conservative Christian Democratic Union and its Bavaria-only sister party CSU continue their four-year partnership with the center-left Social Democrats. The mass-selling daily Bild said Merkel had sold out.

Many of Merkel's deals have infuriated her Christian Democrat party.

"I think the cabinet formation, as it is now, is a political mistake", said Christian von Stetten, a CDU lawmaker who represents business interests, told broadcaster ARD, adding that this applied in particular to giving up the finance portfolio, according to Reuters.

Under the coalition agreement, the SPD will retain control of the foreign, justice and labor ministries among others.

The SPD's new so-called Frontfrau once famously declared in her high-school magazine that her goal in life was either "housewife or chancellor". Merkel ally Julia Kloeckner was forced to defend the coalition agreement. We will keep the finances stable.

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Nevertheless, Germans in the higher tax brackets are likely to be angered by Dr Merkel's quick abandonment of her electoral promise to cut the country's overall tax burden, and especially by her failure to eliminate the hated "reunification tax", a supposedly temporary surcharge introduced in the early 1990s to finance the integration of the former communist East Germany, but still enforced a quarter of a century later.

Even that may prove optimistic if SPD leader Martin Schulz fails to persuade his party's 464,000 members to ratify the deal in a postal ballot, whose result will be announced on 4 March.

Observers expect the referendum to be tight, with the SPD's left and youth wings fiercely opposed to another four years governing in Merkel's shadow. Merkel has been fighting to remain in power since September's disastrous elections and the price she pays could be heavy, with her new government set to be much more active in pursuing greater European integration and reform and Schulz, the former European parliament president who has called for a United States of Europe, ensconced in Cabinet as foreign minister. The SPD won assurances that family reunifications for refugees would resume in August, restricted to 1,000 people a month.

"SPD getting the finance ministry (in Germany) means more social expenditure and perhaps also a less restrictive stance on Southern Europeans", said DZ Bank strategist Daniel Lenz.

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