Schroeder faces rout in German state polls

The Times of India ^ | Februari 02 2003 | Reuters

[knighthawk]

BERLIN: Germans began voting on Sunday in two state elections, with Chancellor Gerhard Schroeder's Social Democrats widely expected to suffer crushing defeats for their handling of the stagnant economy.

Opinion polls indicated his SPD would lose power in Lower Saxony, Schroeder's home state, and fail to oust the conservative-led government in the central state of Hesse, which includes the financial capital Frankfurt.

Polling booths opened at 8 am (0700 GMT) and are set to close 10 hours later when first exit polls will be broadcast.

Ten million people are eligible to vote in the two states, in the first test of public sentiment since last September's general election.

Schroeder's popularity has plummeted since he was re-elected on a wave of support for his anti-war stance on Iraq and his strong handling of devastating summer floods.

He has tried again to tap anti-war sentiment, ruling out a German "Yes" to war in any UN Security Council vote.

But polls show his Iraq policy has not eclipsed concern about economic woes. Businesses and financial markets hope defeats in the two states will speed reform by strengthening the conservative opposition and persuading Berlin to become more aggressive in cutting welfare costs choking the economy.

"I'm optimistic. When the election campaigns are over, the government will put its foot on the accelerator and the opposition will cooperate," the head of the Federation of German Industry, Michael Rogowski, told Welt am Sonntag newspaper.

Stock market boost?

The stock market could also benefit. "New political impetus would definitely help share prices," Hans-Joachim Koenig, fund manager at Union Investment, told Die Welt newspaper.

Rising unemployment, tax increases, near-recession and the absence of convincing reforms have pushed the SPD down 10 points to about 30 percent in opinion polls, with the conservatives close to 50 per cent.

Schroeder has ruled out resigning if the Social Democrats are routed on Sunday, but defeat would be certain to hurt his standing in the party and make it harder for him to get laws passed without backing from the Christian Democrats (CDU).

Losing Lower Saxony will make it all but impossible for the government to circumvent the CDU's majority in the Bundesrat upper house of parliament, where 16 states are represented.

Political analysts say defeat could silence the SPD's left wing, which has opposed moves by Economy Minister Wolfgang Clement to deregulate the labour market.

Losses could also underline the perception that, without radical cuts to the cost-laden social system that has made jobs too expensive for many companies, the government would fail to cut unemployment and lose power in the next general election.

January unemployment data due on Wednesday are expected to show a rise to 4.55 million on an unadjusted basis, the highest level for that month in five years.

[jwalsh07]

Gee, couldn't happen to a nicer marxist.

[Torie]

I don't think the votes from Broward and Palm Beach counties have been counted yet, much less recounted, and re-recounted, and then litigated. So the situation may still be in flux. It is not over until it is over.

[jwalsh07]

:-}