• Germany's news in English
 

Germany looks back at a decade of reform

Published: 14 Mar 2013 15:22 GMT+01:00

Schröder sketched out his reforms to lawmakers on March 14th, 2003, proposing swingeing cuts to unemployment benefits in an attempt to cure the country The Economist magazine had dubbed "the sick man of Europe."

"Overhauling and renewing the welfare state has become unavoidable," Schröder told parliament at the time. "It's not about killing it off, rather solely retaining the substance of the welfare state. Therefore we need fundamental change."

In adopting the initiative which among other things targeted the long-term unemployed, Schroeder's centre-left Social Democratic Party (SPD) "abdicated the (party's) core competence of social justice", political scientist Jens Walther, of Düsseldorf University, told news agency AFP.

This drew the wrath of a section of his party, as well as its traditional allies, the trade unions – 130,000 members left the party between 2003 and 2008 and the SPD's performance in elections weakened. The unreformed socialist party The Left, also prospered from dissatisfaction with the SPD.

Yet ten years later Europe's top economy is one of the continent's most prosperous. Its jobless rate of 6.8 percent last year made it the envy of its neighbours, while most economists and even the centre-right have acknowledged that Agenda 2010 reforms have played a part in this success.

"I don't contest the role played by Agenda 2010 for growth," Rainer Brüderle, the main candidate for the pro-business Free Democratic Party (FDP) in September's federal elections, said last week. But, he added ironically: "Today, the SPD wants nothing more to do with the Agenda."

While Walther said he would not go that far, he said there existed "this contradiction" within the party, which in an election year complicates things for the SPD's candidate to replace Chancellor Angela Merkel, Peer Steinbrück.

On the one hand the party feels great pride for having initiated the reforms which have borne fruit. Without them "we would be alongside Italy, France or Spain, facing clearly bigger problems", the leader of the SPD's parliamentary group Frank-Walter Steinmeier, said on Monday.

But on the other hand there remains a lingering feeling of having betrayed the traditional party faithful. "They say they ended a downward spiral [for Germany's economy] but for many it was just beginning," former trade unionist Wolfgang Denia, an SPD party member, said, denouncing Schröder's reforms for having hit party voters from the working and middle classes.

Under Agenda 2010, long-term unemployment benefits were rolled together with welfare under the now-hated Hartz IV system which sets out in detail what a recipient is allowed to have and spend their money on. The jobless are also forced to take work that is offered to them or risk seeing their benefits cut, while low salaries have become more commonplace with around one worker out of 10 toiling for less than €8.50 ($11.06) an hour.

A poll released this week by Stern magazine showed Germans deeply divided over the legacy of Schröder's Agenda 2010. While 44 percent said the reforms had been good for the country, 43 percent believed that Hartz IV in particular had had a negative effect.

An electoral drubbing in 2009, when the SPD garnered less than a quarter of the votes, led to the party re-examining some of its policies, and today it acknowledges that the reforms had certain harmful effects and plans to remedy them.

Unveiling its manifesto for the September 22 elections under the title 'For A New Social Balance In Our Country', the SPD did not touch on the principles of its 2003 reforms but said it wanted to regulate temporary work, introduce a minimum wage and increases taxes for the wealthiest.

"We've reviewed everything," Cansel Kiziltepe, an SPD candidate in a Berlin constituency for the elections, told AFP. "But the problem of credibility is still there. As long as we don't say clearly 'it was a mistake', we will not be credible," she said.

The SPD currently is polling at around 26 percent, according to a recent survey compared to 40 percent for Merkel's conservatives.

Schröder, visiting the SPD parliamentary group this week for the first time since leaving office, said he could understand the need to temper some of the effects of his reforms.

"If the basic principles of the Agenda – to support and demand more from people – remain intact, I'd be the last one to have something against that," he said, adding that his legacy should not be confused with the Ten Commandments.

AFP/The Local/DAPD/mry

The Local (news@thelocal.de)

Your comments about this article

18:24 March 14, 2013 by RajeshG
I think he was a wolf in sheep's clothes. He did everything pretending it is good for the nation, where as it was good for the business and not the general public and then he became - the chairman of the board of Nord Stream AG, after having been hired as a global manager by investment bank Rothschild - nice cushy job hmmmm paying him millions and not certainly 8 euros per hour
21:22 March 14, 2013 by Englishted
Todays how wonderful it is in German and how thankful we should be story ,force fed "good" stories until we believe and don't question.
22:15 March 14, 2013 by pepsionice
Only to point this out....but the state-run TV news media spent several years blasting away at this change as a very negative thing. They would always show poverty and how Germans were suffering from the change. I can still remember from the World Cup games....having people walking around to pick up beer bottles and how the media noted this constantly on the evening news....as their only way to get ahead for that month.
00:15 March 15, 2013 by neunElf
Yes Herr Schröder is quite the "limousine leftist".

Fits in very well with his comrade, Putin.

Quite a troubling photo for a Bundeskanzler, n'est­ce pas?
Today's headlines
Bayern boss fuels Schweini transfer talk
Photo: DPA

Bayern boss fuels Schweini transfer talk

Speculation that Bastian Schweinsteiger is about to make a big money move to Manchester United increased on Wednesday when Bayern Munich's director of sport Matthias Sammer admitted the star's future remains unclear. READ  

NSA spied on several German ministers: report
Photo: DPA

NSA spied on several German ministers: report

New documents released by WikiLeaks show that the United States did not just tap German Chancellor Angela Merkel's phone but also eavesdropped on several ministers, Süddeutsche Zeitung reported Wednesday. READ  

'Auschwitz bookkeeper' trial nears verdict
Oskar Groening, the 'bookkeeper of Auschwitz'. Photo: DPA

'Auschwitz bookkeeper' trial nears verdict

A former SS officer known as the "bookkeeper of Auschwitz" and a woman who survived the Nazi death camp delivered wrenching testimony in a courtroom on Wednesday as his historic trial neared a verdict. READ  

Assembly robot crushes worker at Volkswagen
A photo of a Volkswagen assembly line, not related to the incident. Photo: DPA.

Assembly robot crushes worker at Volkswagen

A worker was setting up a robot at a Volkswagen factory when the machine grabbed him and pressed him against a metal slab, causing lethal injuries. READ  

Greece crisis
Greek offer 'no basis for discussion': Schäuble
Pro-EU Greeks demonstrate outside the Athens parliament on Tuesday. Photo: DPA

Greek offer 'no basis for discussion': Schäuble

German Finance Minister Wolfgang Schäuble said Wednesday crisis-hit Greece was sending mixed signals in debt talks and called on its government to "clarify its position" before negotiations with creditors can resume. READ  

Weathermen issue snow alert in heatwave
Could this be July in North Rhine-Westphalia? Photo: DPA

Weathermen issue snow alert in heatwave

The German Weather Service (DWD) issued a weather warning for North Rhine-Westphalia (NRW) on Wednesday predicting 5 to 10 cm of snow and winds of up to 60 km/h. READ  

Analysis
How German media shaped the Greece crisis
Angela Merkel faces a battery of microphones and cameras at a eurozone summit in Brussels on June 22nd. Photo: DPA

How German media shaped the Greece crisis

It's often said that German Chancellor Angela Merkel is the one person who truly matters when it comes to how the eurozone deals with Greece. But how much freedom does 'Mutti' really have in the face of the public and the media? READ  

Women trade punches over neglected dog poo
'This is not a dog toilet.' Photo: DPA

Women trade punches over neglected dog poo

Bergisch Gladbach in North Rhine-Westphalia, hometown of supermodel Heide Klum, was once linked in Germans' minds with the catwalk. But now it is just as infamous for a dog walk, after two women came to blows over a mound of pooch poo. READ  

Referee costs Germany dear against USA
Head coach Silvia Neid (r) with Celia Sasic (l) on the bench. Photo: DPA

Referee costs Germany dear against USA

Germany coach Silvia Neid said she found the referee's decision-making 'sad' in her country's 2-0 semi-final defeat to the USA in the Women's World Cup in Montreal on early Wednesday morning. READ  

Train strikes
Train drivers and Bahn bury the hatchet
Three ICE (intercity) trains stand in a siding. Photo: DPA

Train drivers and Bahn bury the hatchet

The Train Drivers' Union (GDL) and Deutsche Bahn (DB) have finally agreed to end their dispute over drivers' work conditions, offering hope that nine months of rail chaos has finally come to an end. READ  

RECEIVE OUR NEWSLETTER AND ALERTS
Politics
How German media shaped the Greece crisis
Society
An eye for an eye? Mum protects child in playground with pepperspray
National
As it happened: Queen Elizabeth's final day in Germany
National
As it happened: Queen Elizabeth's second day in Germany
National
Queen Elizabeth II's first day in Germany - as it happened
National
Bus passengers tell fake racists where to get off
Politics
What's really in the Queen's handbag?
National
Germans say USA doesn't respect freedom
National
Yes, you CAN buy adult e-books before 10pm in Germany
VIDEO: Watch a 93-metre turbine crash to earth in slow motion
Gallery
Who's got a shot at the German Film Awards
Rhineland
Anger over 'child-free' beer garden
National
How do you do, Majestät?
National
Man defends right to pee in public with tear gas
Features
The Germans who won Waterloo for the British
Frankfurt
Should Germany ban circus animals?
Hamburg
Where people are having the most sex in Germany
Culture
Who Wants to be a Millionaire? Not this student...
National
Dresden's three-decade-long red light
Politics
Upper house calls for gay marriage now
Berlin
Berlin named 3rd-best city worldwide
Sport
In search of the toughest firefighter
Business & Money
German firms shine for European engineering students
Gallery
Hitler's paintings up for auction
National
German's 70-year search for murdered US pilot
Politics
What the G7 leaders agreed at Elmau
Business & Money
What really makes Germans happy
National
Playmobil builder leaves worldwide legacy
National
The car share that became a drug run
Politics
What Snowden revealed to Germany
Rhineland
Why wolf cubs are being raised by hand
National
Hitler's booze cave found
National
Environment makes Germany worth living in
Culture
What's top of the charts in June
Gallery
Germany's most beautiful cycle routes
Business & Money
The business case for Britain in the EU
Rhineland
Why farmers are free to pong up the countryside
Latest news from The Local in Austria

More news from Austria at thelocal.at

Latest news from The Local in Switzerland

More news from Switzerland at thelocal.ch

Latest news from The Local in Denmark

More news from Denmark at thelocal.dk

Latest news from The Local in Spain

More news from Spain at thelocal.es

Latest news from The Local in France

More news from France at thelocal.fr

Latest news from The Local in Italy

More news from Italy at thelocal.it

Latest news from The Local in Norway

More news from Norway at thelocal.no

Latest news from The Local in Sweden

More news from Sweden at thelocal.se

6,949
jobs available
Toytown Germany
Germany's English-speaking crowd