The election results registered the divisions among the German rulers, in the face of workers’ resistance, over how far and how fast to push cuts in pensions, unemployment benefits, and other social programs. Under the Social Democratic administration, the German ruling class began attacks on the social wage to shore up falling profit rates and to compete with its rivals.

Both the SPD and CDU promise to end economic stagnation, which has its roots in the German rulers’ inability to swallow the former German Democratic Republic in the East. Berlin has pumped tens of billions of dollars into the East every year since reunification in 1990 to avoid a showdown with workers and farmers there.

Many in the big-business press made no secret of their support for Merkel’s plan to accelerate the attacks on the social wage. The London Economist wrote the week ahead of the election that a CDU-led government “could become a model for other big European Union countries, such as France and Italy,” even though its “reform plans may not be sufficiently bold.”

Protests of tens of thousands greeted the Social Democrats’ introduction of “reforms” in the summer of 2004. The SPD plan reduced monthly benefits to the jobless and forced the long-term unemployed to accept jobs paying one or two euros per hour (1 euro =US$1.22) or lose their benefits.

The unemployment rate this year reached its highest level since World War II—it is currently 11.4 percent nationwide, and above 18 percent in the East.  
 
 
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