German Opposition Split Over Reforms

Last week the subject was inner-party fighting in Chancellor Gerhard Schröder’s Social Democrat Party over reforms the German leader has been pushing for as part of his comprehensive "Agenda 2010" package, which seeks to streamline the country’s behemoth social system in order to revive the sluggish economy.

This week, the SPD wrangling, although still of interest considering the question of the party’s ability to secure a parliamentary majority in key October votes, is taking a backseat to the opposition’s own internal dispute over its reform proposals.

The conservative Christian Democrat Union and its smaller Bavarian sister party, the Christian Social Union, have been busy drawing up their answer to Schröder’s reform platform, one they claim will be socially just and economically viable. And just as the SPD assigned the task of drafting new proposals to several extra-parliamentarian committees, the CDU gave the job to CDU member and former German President Roman Herzog. On Monday evening, party leaders approved the Herzog Commission's package of reform proposals which recommend, among other things, decoupling health and nursing care premiums from people’s earnings and levying a lump monthly sum across the board instead.

CDU party leader Angela Merkel embraced the plans, calling them a "paradigm shift" and said they presented a "most important switch for Christian Democratic politics."

A violation of party principles?

But not everyone in the party is enthralled with the Herzog plan, and as is the case in the SPD with Agenda 2010, several members are balking at what they consider a violation of the CDU’s core social values. Both high-ranking party members and CDU rank and file have criticized the proposals for placing the boss and the janitor on the same level and making both pay the same lump sum of €264 for health insurance plus another €60 to cover nursing care costs.

CDU deputy leader Norbert Blüm, a former labor minister under Chancellor Helmut Kohl, said the plan was socially unbalanced and would hurt common people while letting the more affluent off the hook. Blüm warned on Monday that the Herzog proposals would turn the party into a neo-liberal party unattractive to most German voters.

But Merkel quickly retorted: "Whoever claims that the proposals are socially unbalanced and in stark contrast to core Christian Democrat values will be asked to come up with whatever they think may be better. I haven’t seen any reasonable alternatives as yet."

Stealing from the poor?

Another staunch critic of the reform plans, the head of the CDU employees’ association, Hermann-Josef Arentz, has already announced he’ll fight the Herzog suggestions tooth and nail, secure in the knowledge that he has much of the party behind him.

"The bottom line of these proposals is that people with low incomes will face a bigger burden as they will have to pay the same premiums as those with higher incomes," Arentz explained on Tuesday at the start of CDU regional conferences focused on gearing up support for the reforms.

"The Herzog Committee itself reckons that about €40 billion in tax refunds will be needed to compensate the not-so-well-off in order to be able to call the scheme socially balanced. That’s about 20 percent of all taxes the state has at its disposal," Arentz said explaining his doubts about the feasibility of the reforms.

Making matters even worse for the CDU leadership, it’s CSU sister party has also come out strongly against the Herzog plan.

CSU: plan 'unjust'

On Wednesday Edmund Stoiber, Bavarian premier and last year’s chancellor candidate for the Union block, criticized the plans as "unjust." Although he said the CSU was generally willing to compromise with the CDU on the much-needed structural reforms, he was insistent that the parties "remain by their central philosophy, that people with higher incomes should pay more than those with lower incomes."

He also criticized the Herzog proposal to raise the retirement age to 67. On Nov. 17, Stoiber will present his party’s plans for reforming Germany’s pension system.

The split between the two conservative parties comes just two weeks after Stoiber and the CSU reached an all-time record high in state parliamentary elections. Many analysts believe that the willingness of the CSU to take a separate stance to the larger CDU has been strengthened by the surge in popularity in Bavaria.

But when questioned about the difference in opinion between CDU and CSU, Stoiber replied, matter of factly: "In the end we’ll find an agreement. That’s the way it’s always been."