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Saturday, April 20, 2013 12:04 PM


Understanding German Politics


Inquiring minds in the US note the upcoming German election and may be wondering about the platforms of the major political parties. Reader Bernd from Germany explains.

Die Linke (The Left): Die Linke is made up of the former SED/PDS (The East German Communist Ruling Party), some former West German Communist and Socialist Parties and a “rebel group” of the SPD. They all have merged and are now called "Die Linke". By and large they have a communist/socialist platform, albeit not Stalinist. Their main requests are: dissolve NATO and replace it with a new organization to include Russia in it, end all wars, control or nationalize all relevant banks and some crucial industries, increase support for the poor, raise taxes for the rich (above income of 60k Euros gradually go to 75%), introduce a stiff wealth and inheritance  tax. They are pro Euro and want the introduction of Eurobonds immediately. To alleviate the economic crisis in Europe they advocate some serious deficit spending for social and work programs. They have voted against ESM; EFSF and Cyprus deal in Parliament.

SPD (Social Democrats): SPD is the grand old Social Democratic Party, with a wonderful and long tradition. SPD originated from the worker's movement. Its first party program is from 1869. It the only party that tried to stop Hitler's power grab by opposing the emergency laws in 1933. Many went to concentration camps for opposing Hitler. In post-World War II Germany SPD provided three Chancellors, Willy Brandt, Helmut Schmidt and Gerhard Schröder. All three Chancellors were major reformers in Germany for one or the other topic.  SPD lost its original power base in the wake of Schröder's reforms in the early 2000s. SPD is a staunch pro Euro party. They also want Eurobonds immediately, as well as a common fiscal policy, a bank union and a quick unification of Europe.

Die Grünen (The Green Party): Die Grünen started as a mix of 1968 communists/socialists and anti-nuclear energy activists in West Germany. The second part is made up of some left over former East German anti SED “rebels” who helped to bring down East Germany.  Today this is the party for so the so-called "politically correct". In Germany we call them the Latte Macchiato Moms/Dads. The typical party member is a well-paid Government official or teacher with a work week of 36 hours. They believe firmly in manmade climate change and want to tax and spend their way to eliminate the CO-2 footprint. No amount of money is too much for preventing climate change. They are staunch pro Euro advocates similar to the SPD.

Freie Demokratische Partei FDP (Free Democratic Party): originated from a mix of former liberal parties during the Weimar Republic with an originally clear idea on liberalism. The FDP once strongly supported human rights, civil liberties, and international openness, but has shifted from the center to the center-right over time. Today’s main goal is to get at least 5% of the popular vote, otherwise they will have no representation in parliament. They are a coalition partner to Merkel's CDU party but most of them would be hard pressed to state why. FDP may not pass the 5% threshold in the next election. FDP states that they wish Europe to return to the “No-Bail out Clause” and the Maastricht Agreement, however, in Parliament they voted for a massive breach of both agreements, following Merkel’s position.

CDU (Christian Democratic Union): CDU is a center-right, typically Catholic, typically pragmatic popular party. It is the party of most Chancellors now including Angela Merkel. I call it the "yes Chancellor Club". Merkel calls herself pragmatic, some German people call her "Mutti". Mutti in German means a cunning, but one minded pragmatist, who will reprimand/control her husband for coming home late from a bar. CDU is pro-euro but against Eurobonds. Under Merkel CDU has lost its profile and has made some erratic shifts in position, which is a major turnoff for many supporters. Notably Merkel’s agreement to the breach of all EU-Agreements and her shift to a so called “green energy” has alienated many voters.

CSU (Christian Social Union): CSU is the Bavarian sister to the CDU. Whereas CDU operates in 15 States, CSU is in Bavaria only, where it traditionally gets 50 plus percent of popular votes, thus catapulting it above 5% on federal level. Voter participation in Bavaria is traditionally above 75%. CSU follows Merkel, but tensions are rising. Many CSU members are far from convinced that Merkel is right. Most of legal obstacles against Merkel's Euro policies in front of the Federal Constitution Court come from members of the CSU. Due to its high degree of organization and its firm foundation in the center of Bavarian populace, CSU is rather influential in German Federal Politics.

Alternative für Deutschland) AfD (Alternative for Germany): AfD is a liberal-conservative party supported by many German economists. More than two-thirds of its initial supporters hold doctorates. Its main position is a return of the EU to the original meaning of the Maastricht agreement, alternatively a return to national currencies. The second major topic is the strengthening of German Democracy, advocating a Swiss – like model. In April 2013, the party held its first convention in Berlin, which was attended by about 1500 supporters. The convention elected the party leadership and adopted the party platform. The three elected speakers are economist Bernd Lucke, the entrepreneur Frauke Petry, and the publicist Konrad Adam. The key demand of AfD is to provide a mechanism for countries to exit the Eurozone. In old Germany, "liberal" was in regards to Civil Rights, not free-flowing money or other policies those in the US may associate with the word. Liberal for AfD is a bit different than for the current FDP

Mish Note:

Reader Bernd is not (not Bernd Lucke, the economist and AfD elected speaker). I will have election predictions next week from Reader Bernd.

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com

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