After starting off this year’s early election campaign with a debate about the dangers of the sometimes problematic short term investment horizons of private equity firms, it was the SPD’s very own loony left’s locusts in the party’s board that forced their chairman, Franz Müntefering, to declare that he would not seek re-election at the party conference next month and that he was no longer certain whether he could then serve as the minister in a grand coalition. Certainly, given that surprises seem to have become the rule in German politics by now, things might look different by then.
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Tag Archives: Germany
A palace coup
This just in: Andrea Nahles has defeated Kajo Wasserhövel for the job of general secretary of Germany’s Social Democratic Party. Nahles got in with the votes of the party’s left wing. Wasserhövel, who had managed the SPD campaign in the recent elections, was the protegé of party chairman Franz Müntefering. ‘Former chairman’, I ought to have said; for Müntefering has resigned in response to this lunger contemptuously hocked in his face. It’s not even clear now whether he will take up his expected ministerial post in the grand coalition.
And speaking of that grand coalition… apparently it wants to place further limits on food retailers’ ability to compete on price. Those who find it hard to believe there’s not a Groschen‘s worth of difference between black and red are invited to consider this example of how awful the two parties can be when they really put their minds to cooperating. (Admittedly, the Union’s man in all this is Horst Seehofer, an advanced economic illiberal even by CSU standards.) Someday, maybe, my bizarre dream will come true and Germany will be governed by an FDP/Green coalition* and we will see the end of this sort of thing. I may be waiting a long time, not least because the Greens and the liberals hate each other so.
* It’d have to be rather different FDP, mind. I couldn’t abide the thought of Guido the Boy Party Chairman playing any role in government.
Does relative size matter?
Over on almost a diary, I’ve recently mentionend a survey of German blogging called “Weblogs 2005 – Bloggen im deutschsprachigen Raum”, conducted by Jan Schmidt at the University of Bamberg. While the German blogger himself is a relatively unknown species to date, the relatively small size of the German blogosphere as a whole has been observed with some interest for a while now, particularly when compared to the French blogosphere, and the amount of attention blogs have suddenly gained in the so called German mainstream media. It’s one of the eternal questions of humanity asked a new variant: Does size matter?
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Fischer’s gain, America’s loss?
Michael Moore gives us a thoughtful article about Joschka Fischer (and some priceless Fischer anecdotes) in Slate today. Before going any farther I should make clear that I refer not to the notoriously fat filmmaker but to Michael Scott Moore, an American novelist living in Berlin. Of his fatness or otherwise I am entirely ignorant.
Of Demons and Details.
Tonight, a French friend sent sent me an email expressing his disappointment about the fact that a Eurodistrict comprising the French (Euro-)city Strasbourg and the German regional authority Kehl, which will be officially created by officials from both parties at a signing ceremony tomorrow afternoon, is falling far short of the enthusiasm it was conceived with (some details by Reuters (in French)).
During the heyday of the latest Franco-German governmental rapprochement in early 2003, Chancellor Schröder and President Chirac signed a declaration calling for new forms of European institutional cooperation. But lacking consistent ideational support from the two governments, the regional authorities were unable to overcome different administrative practices, legal concerns, and – problems to fund a bridge. Thus, they will not establish a new form of supranational institution but rather “just another” council for regional cross-border cooperation. And they won’t get a new bridge.
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Go West Young Man
My preocupations about the impact of demographic change on German society are already pretty well known. Well if Germany as a whole has a sizeable problem, the former East German Lande have a huge one. The state-owned KfW development bank project in a report out today (German only unfortunately, an English version of the press release is here) that the while the population of the old West Germany will drop by six percent between 2002 and 2050, that of the six eastern states will decline by a whopping 25%. Not to mention the fact that those who remain are likely to be even older on average than their Western counterparts. As a consequence the available workforce is likely to fall by a staggering 55%.
The issues raised by this research are large and important. Is, for example, East Germany now in irreversible decline? Can this process repeat itself elsewhere (including between rather than within nation states) as younger, more highly skilled and more mobile workers leave ageing and relatively more depressed areas etc?
The issue of migration from East to West Germany been receiving attention for some time now. Frank Heiland in a survey “Trends in East-West German Migration from 1989 to 2002” (follow the link and go to Volume 11 article 7) argues that there have been two waves of East-West migration The first one, 1989-1990, was triggered by the opportunities and uncertainties before the Reunification; the second one, since 1997, coincides with economic stagnation in the East and improving job prospects in the West.
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German Inflation Revised Down
I like this title. I have, I unashamedly admit, lifted it straight from NTC research (where it was in any event hardly the most creatively original of headers). I like it since it seems to run counter in spirit to all those admonishing lectures we are currently getting about the dangers of ‘secondary inflation’ and pass-through. The headline refers to the fact that Germany’s EU-harmonised annual inflation rate (HICP) for September was revised down to 2.6 percent from an initial 2.7 percent, the Federal Statistics Office announced on Wednesday. Actually this revision is something of a statistical freak as the reading in question was the harmonised consumer price index for Germany, which is calculated for European purposes. In fact AP runs a different headline: German Inflation Rate Climbs in September, which doesn’t really prove that there are lies, damn lies and statistics, but rather that we have a labyrinth of statistical indices at work – AP quote the straight national CPI, and not the harmonised index. Anyway, if you can battle your way through all this, well good luck to you!
Much more to the point, however, is the detail that , not considering heating oil and motor fuel, the rate of price increase would have been just 1.6%. Inflation scare? Where? Oh yes, I forgot, in Spain and Greece.
As reported by the Federal Statistical Office, the consumer price index for Germany rose by 2.5% in September 2005 on September 2004, and by 0.4% on August 2005. That is the highest year-on-year rate of increase for more than four years (May 2001: +2.7%). In July and August 2005, the year-on-year rates of change were +2.0% and +1.9%, respectively. The estimate for September 2005 based on the results from six Länder was thus confirmed.
The year-on-year rate of price increase was strongly influenced by the sustained price increase for energy in September 2005. In that month, price increases were recorded primarily for mineral oil products again. Not considering heating oil and motor fuel, the rate of price increase would have been just 1.6%. Domestic fuel prices were up 40.0% compared with the same month a year earlier.
Source: German Federal Statistical Office
UK and German Retirement Policies Compared
As we all know raising the participation rates of older workers is both essential and a core component of the Lisbon Agenda, so here’s a timely report from the Anglo-German Foundation for the Study of Industrial Society comparing policies directed towards older workers in the UK and Germany. More salacious material to stimulate all you policy wonkers out there. (Hat Tip to David from North Sea Diaries). Looking at the table on page 3 the UK seems to have been a good deal more successful in acieving these objectives over the last decade. In both coutries male participation rates in the 55-64 age group has actually gone down since 1990, with the increase for the group as a whole being a matter of increasing female participation. On the other hand the UK has managed to reverse the 1990 – 2000 downward male trend and between 2000 and 2004 55-64 male participation went up, something which it noticably didn’t do in Germany.
The report concludes that the primary deficit concerning active labour market policies for older unemployed in Germany is the lack of specific targeting of this group both in active job placement and training. In the UK, the scope of active measures is rather limited both with regard to the kind of measures � New Deal 50 plus/New Deal 25 plus � and the level and duration of funding………In the UK � despite a more socially inclusive stance recently � funding of job creation and a broad application of training measures has not taken place so far, given the low intervention character of labour market policies. In Germany, in the wake of recent labour market reforms, a shift in paradigm towards a more activating approach to job placement has been implemented.
Kanzlerin
German media are now reporting that the SPD has agreed to let the largest parliamentary faction put forward the candidate for Chancellor. For three weeks, the Social Democrats had been arguing that as the largest party represented in the Bundestag, they had the right to name the candidate. (Germany’s Christian Democrats come from two parties, one from Bavaria and one from everywhere else, but they work together, mostly, as a single parliamentary faction.)
The SPD has given way on this point, clearing the path for Angela Merkel to become Germany’s first female Chancellor.
In return, the SPD will get eight of fourteen ministires, including finance and foreign affairs. The head of the CSU, who lost to Schroeder in 2002, will go to Berlin as minister for the economy. Since the SPD will head the ministry of finance, which is responsible for the budget, this will ensure that the traditional trench warfare between these two ministries will continue unabated.
None of the reports say anything about what Chancellor Schroeder will be doing next. The political folks I’ve talked with can’t imagine him being #2 behind Merkel, even as foreign minister, but they also have a hard time picturing him just walking away.
We’ll know much more at 2:30 this afternoon, when both parties have press conferences scheduled.
PS: The trial balloon for the weekend was the introduction of tolls on the Autobahn, roughly EUR 100 per year. Between that and a VAT hike, the grand coalition might bring Germany the worst of both worlds.
German Exports Continue To Rise
German exports, long the mainstay of the national economy, rose for a third month in four in August according to data released today from the Federal Statistical Office. The year on year increase of 13.4% is partly a reflection of the way the recent drop in the value of the euro has helped boost demand.
“According to provisional data of the Federal Statistical Office, Germany exported commodities to the value of EUR 63.4 billion and imported commodities to the value of EUR 51.9 billion in August 2005. German exports of August 2005 thus were 13.4% and imports 15.3% above the respective August 2004 levels. Upon calendar and seasonal adjustment, exports increased by 3.5% and imports by 6.0% compared with July 2005.
The foreign trade balance showed a surplus of EUR 11.6 billion in August 2005. In August 2004, the foreign trade balance showed a surplus of EUR 11.0 billion. Upon calendar and seasonal adjustment, the foreign trade balance showed a surplus of EUR 12.7 billion in August 2005.”
While exports power ahead the continuing weaknesses in domestic consumer demand and investment are to be seen in the fact that German industrial production fell 1.6 percent in August while factory orders fell 3.7 percent.