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Popular Outrage against Cuts in Unemployment Benefits (August 9, 2004)

A team of journalists describes the surprising surge of protest and popular outrage against the government-sponsored Hartz Commission and its recommended cuts to unemployment benefits. The public response intimidated reform-oriented politicians; the only politicians who benefited from all of this were post-Communists in the East and hardline Leftists in the West.

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The Big Hartz Hysteria

Germany in panic: the planned social cutbacks have sparked a vague mood of impending doom, even among those not directly affected by them. CDU and FDP strategists are already distancing themselves – from themselves. The PDS is the main winner in this eagerly stoked panic.

[ . . . ]

“Hartz IV has got to go.” A wave of summer-time indignation is washing over the country. It started in the dreary residential districts of Leipzig-Grünau, Berlin-Marzahn, and Hamburg-Steilshoop, and from there it spread through virtually all strata of the population. Agenda 2010 – Chancellor Gerhard Schröder’s already unpopular reform program, which involves, among other key measures, merging unemployment and welfare benefits – is encountering fierce resistance, and this is hardly attributable to the cutbacks that were actually passed. For it cannot be said that all benefit recipients will be worse off starting next January. It won’t be clear whether the reforms succeed or fail for at least a year, when the unemployment figures either go down, as Schröder promised they would, or when they reach new record highs, as his critics fear.

But the current wave of indignation permits no time for reflection. It washed away the arguments of the reformers and is now in the process of engulfing the reform advocates in the ranks of the Union and FDP as well. The Chancellery noted with displeasure that politicians who once fought [with Schröder] to push the Hartz package through the Bundestag are now abandoning him in the face of [public] outrage. It seems there are no longer party differences in Germany, only Hartz opponents. CDU party leader Hermann-Josef Arentz spoke of “a campaign against the long-term unemployed.” SPD social policy expert Ottmar Schreiner spoke of “a policy that opposes the historical core of social democracy.” Even politicians who previously demanded the radical dismantling of the welfare state are suddenly discovering their sympathy for the seemingly or actually downtrodden.

For example, CDU economy expert Friedrich Merz, who was just trying to get rid of lay-off protection altogether, criticized the labor market reform as “a highway toll plus a can deposit to the tenth power.”* CDU chief Edmund Stoiber, who wants to cut welfare benefits at quarterly intervals, complained of a “social imbalance.” FDP chief Guido Westerwelle found the whole thing “very out of touch with real life.” But most of all, politicians’ actions during the summer debate suggest that they’re all suffering from a kind of collective amnesia. It was only last December that they – with the exception of those federal states with government coalitions involving the PDS – approved the reform in the Bundesrat: the FDP and the SPD alike, the Union and the Greens. Now even the various party chiefs are acting as if they had absolutely nothing to do with the whole affair. CDU chief Angela Merkel now talks about “the social decline of multitudes” through reforms she largely helped formulate. And head of the Greens, Reinhard Bütikofer, demanded that the “allowance for individual savings” be “reconsidered.” East German minister presidents Matthias Platzeck (SPD) and Georg Milbradt (CDU) are using a particularly convoluted argument to try to get off the hook. Fearing their constituents’ rage, they are claiming that they voted against the reform in the Bundesrat. But in fact their vetoes were only against the new structure of administrative responsibilities. They expressly voted yes to the planned benefit cuts.

[ . . . ]

* Merz views Hartz IV as the culmination of controversial red-green government coalition reform measures, following the introduction of a highway toll for trucks and a deposit on beverage cans – trans.

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