Only in Greece, which headed to the urns a week later, did social democracy wangle any sort of cleanish victory. Although this was largely a product of a spectacular object lesson in hara-kiri by the parliamentary far left – the sort of deranged and embarrassing public suicide English and Scottish trainspotters of the left will be all too catsuitedly, swingingly familiar with.

This was bit of a bummer for the ‘left of the left’, which by rights should have scored a nifty hat-trick over the last week. All the same, this impressive two-out-of-three standing proves that the far left’s middling result in the European elections were a low turnout aberration while the centre-left’s disaster on 7 June is more indicative of a general pattern.

No shift to the right in Germany

While Chancellor Angela Merkel, leader of the Christian Democrat Union (CDU), will be staying in office, in coalition with the Free Democrats who scored a historic high of 14.6 per cent, the CDU victory cannot be in any way described as a triumph or shift to the right. Merkel led her troops to their second worst showing since the Second World War.

The Social Democrats (SPD) meanwhile achieved their absolute worst showing since the war. So much as to be expected. Far from benefiting from the ideological fallout in the wake of the worst economic crisis since the Depression, the SPD, like their cousins across the continent, have been engaged in a cosy clusterfuck around the neoliberal centre for the last decade and as such are believed by great swathes of voters to hold equal responsibility for the crash.

Working class voters remember who were the authors of the Hartz reforms – which saw tax cuts and a slashing of medical, pension and unemployment benefits not indistinct to the slash and burn approach of Thatcher and Reagan two decades before – and lacerated the SPD’s vote by 11 per cent to 23 per cent (a loss of some six million votes).

Next to the Free Democrats, the other star of the night was Die Linke (the Left), the coalition of ex-GDR communists, western altermondialists and SPD dropouts, that in its second federal election outing, scored 11.9 per cent, up from 8.7per cent in 2005.

In the eastern state of Brandenburg, Die Linke topped the polls, with
28.5 per cent. In Mecklenburg-Vorpommern and Saxony-Anhalt, also both
in the east, the party came second, while in the capital, Die Linke tied with the SPD for runner-up.

These crackerjack results come in the wake of regional elections in Thuringia, Saarland and Saxony on 30 August, where the new party leapt ahead to second place.

But as formidable as Die Linke’s showing has been, beneath the surface, tensions submerged for the sake of the campaign threaten to openly break out again, with many of the anti-capitalist types in the west suspicious of the Stalinists from the east, and uneasy with how comfortable the ex-Communists and ex-Social Democrats are as a ginger group to the SPD.

The easterners meanwhile, who view themselves as a party of government ready to take the reins of power again, glance askew at the punky, hippie radicals from the west.

But even this is an oversimplification for a party that contains six different internal caucuses. Some sympathisers joke that Die Linke has as many factions as members.

However, the faultlines are quite clear. While the FDP and CDU majority victory rules out the red-red-green coalition that had been mooted in some quarters, such an alliance is quite likely at the state level in Saarland and Thuringia (although shortly after the election, the SPD announced it would rather govern in coalition with the CDU). But when Die Linke has entered government, in Berlin and Brandenburg, its left rhetoric has been revealed to be just that.

Even the party’s popular opposition to the war in Afghanistan (some 80 per cent of Germans oppose occupation) appears to be negotiable. In the week of the election, Dietmar Bartsch, a senior official with Die Linke told the Tagesspiegel newspaper: ‘When we say “out of Afghanistan” we don’t mean “get out of Afghanistan the day after tomorrow.”‘

Portugal’s Left Bloc junks the dogma

Meanwhile, on the southwestern edge of Europe, parties to the left of
the left scored better still.

Portugal’s prime minister, Jose Socrates of the centre-left Socialist
Party, crowed on election night of his 36.5 per cent support, ‘The people have spoken and they have spoken loudly. The Socialists were once again chosen to govern Portugal and they were chosen without any ambiguity.’

But the party had only won 96 seats in the 230-seat chamber, down from
121 in the last election – and some 40 per cent of the electorate stayed at home. The opposition Social Democrats, who despite their name are of
the centre-right, clocked in at 29 per cent, and in a sign that parties
further to the right are profiting from the crisis, the hard-line Popular Party climbed to 21 seats up from the 12 it held previously.

Domestic analysts attribute the victory of the left of the left to alienation amongst blue-collar workers, civil servants and young people from the Socialists, who ahead of the economic crisis had imposed fearsome public spending cuts provoking massive protests, including a general strike.

The big champion of the campaign was the far left, scooping up a combined 17.7 per cent, with the Left Bloc, an alliance of anti-globalisation activists, ecologists, Trotskyists and Maoists, gaining 9.85 per cent to give it 16 seats, and the Communist Party securing 7.9 per cent and 15 seats.

Rui Tavares, a Left Bloc deputy in the European Parliament explained
to Red Pepper the party’s recipe for success: ‘We’re only ten years
old, but the key is that we’re a different kind of left – less dogmatic, less closed, but at the same time not losing our radicality. This is what must be repeated with the rest of the left in Europe.’

‘The old social democrats, with their ideological drift and embrace of the free market in the 1990s, forgot why they were on the left’, he said. Only superficially does it seem like a paradox that the centre-left cannot seem to benefit from the collapse of neoliberalism. They cannot take advantage of this situation because they are implicated themselves.’

‘Portugal [and] Germany are not isolated cases. I can see a clear strategy for the real left to occupy significant political space – a quarter to a third of the electorate. We’ll see a lot more of this in the next few years.’

Ahead of the election, both leading parties ruled out a grand coalition and the Socialists, Left Bloc and Communists have said they will not form an alliance – although such a move would give the parties a comfortable 127-seat majority. With business groups in the days after the election ominously warning what might happen if a leftist coalition were formed, the Socialists are most likely to attempt to continue as a minority government

One young leftwing voter said that he was thrilled by the result, although he warned: “The Left Bloc deserves their victory, but the communists, you have to remember, are old Stalinists, very nationalist. This is not the future of the left. It’s nostalgia.’

Waffle, zigzag, squabble

A week later in Greece, the centre-left Panhellenic Socialist Movement (Pasok) walked away with 43 per cent of the vote, giving the party 159 seats in the 300-seat chamber. The centre-right New Democracy party of Prime Minister Costas Karamanlis, had called a snap election only two years after his 2007 election win, hoping to boost his faltering government with its one-seat majority. But the gamble did not pay off, with his scandal-ridden conservatives gaining only 34 per cent of voters.

The Pasok victory masks a deep alienation from official politics for most Greeks. One survey revealed that nine out of ten voters said they had no faith in either main party. Although at one point it looked as though the far left would profit from this sea of mistrust, such hopes failed to materialise.

The far left Syriza coalition saw a decline in its support from the previous
five per cent and 14 seats won in 2007, to 4.4 per cent and 12 seats.
The Greek communists remain the third largest party in the assembly, but they too saw a drop since the last election, clocking in at 7.3 per cent and 20 seats, down from 8.2 per cent and 22 seats.

A year ago expectations were radically different, with Syriza riding a high of 18 per cent in the polls.

It may be true that Pasok shifted to the left during the campaign, with promises of an up to 3 billion stimulus package that would include above inflation wages and pension increases, higher taxes for the wealthy, a review of the privatisation of Olympic Airlines and the sale of the government’s stake in OTE, the telecoms firm, but this was not enough to precipitate such a decline.

Syriza, a rainbow coalition (well, a rainbow of dark green, crimson, scarlet, vermillion and cerise) of 11 different leftist parties and unaffiliated individuals, is dominated by the 17,000-member Synapsismos, itself a coalition that for the most part sits on the rightwing of Syriza.

The coalition almost collapsed over a leadership battle between Synapsismos and the smaller groups in its orbit as to who would head the grouping heading into the election. A bizarre compromise at the last minute had the two sides agree that no one would top the list.

This cringeworthy squabble further disillusioned supporters already disenchanted when the coalition’s leadership, which zigzags between radical language and moderate practice, and waffled over how to react to the three-week long riots last December. Abstentions were particularly high amongst the young.

Candyfloss in the rain

The results of the last weeks have shown that the deluge of gloom overwhelming Europe’s centre-left in the wake of the European elections is entirely warranted. Their support is melting away like pink candyfloss bought at a rainy May Day carnival, even in countries where they manage to eke out an election win. The only hope they have is to tack to the left, something that they steadfastly refuse to do or only do rhetorically for a four or five weeks’ election campaign.

But these elections also show that there are tremendous prospects for
a left to the left of bankrupt social democracy – so long as the party puts forward a confident professionalism and finishes with the sectarian quarreling endemic to this end of the spectrum. At a time where party tribalism has all but disappeared, voters who have few qualms about abandoning the social democrats that their mothers, grandmothers and great-grandmothers voted for to try something new will hardly develop new reservoirs of compunction about moving on again should the new party prove to be a bunch of bickering muppets.

At the same time, the ease with which some left or green formations in
Europe have been willing to enter into coalitions with neoliberal social democrats – from Communist Refoundation in Italy to France’s Communists to Ireland’s Green Party – or are otherwise seduced by the siren song of the sensible centre, moves that repeatedly end in electoral disaster for the group concerned, are not strategic differences that can or should be papered over. They are fundamental to whatever the new left is to look like.

But if what finishes off social democracy is the abandonment of principles, why should anyone be surprised if voters jettison the far left as well when it abandons its principles too?

The protests around the 2005 G8 summit at Gleneagles in Scotland saw the institution develop an almost unprecedented level of legitimacy in the world’s eyes. By asking it to ‘make poverty history’, an unlikely coalition of pop stars, politicians and parts of global civil society managed to obscure the fact that the G8 – and the system for which it stands – are in fact the root cause of poverty, not its eliminators.

This year’s summit was different. On 2 June, over 80,000 people demonstrated in Rostock against the G8, rejecting its claims to democratic and political legitimacy. A few days later, 15,000 people succeeded in blockading all the roads to the conference centre, cutting the G8 off from its vital infrastructure of translators, service providers, diplomatic advisors and journalists.

Delegitimation of protest

Despite Chancellor Merkel’s attempt to cast the summit (and herself in particular) as an effort to get serious on the issue of climate change, there was a relative failure to produce the kind of legitimacy that the Gleneagles summit had enjoyed. And this is where the other side of the same coin came into play: the delegitimation of the protests against the summit. Stories were fed to the press about Rebel Clowns using water pistols to spray the police with acid. Stones were reported as being thrown where nothing of the kind had taken place. References to the potential ‘return of left-wing terrorism’ were constant.

These efforts at delegitimation were not isolated events, taking place in a state of exception around the world leaders’ meeting. Over the past few months, there has been a steady attempt to intimidate and criminalise parts of the left and radical-left in Germany. The primary means by which this has been being done is through the construction of a ‘terror’ discourse. The notion of terror has – discursively, if not (yet!) legally – now been expanded so far as to even include the daubing of buildings with paint! Fear has constantly been stoked by a series of high profile and sensationalised raids and arrests.

Police raids

On 9 May, more than 40 properties, including social centres, offices, bookshops and private homes in Berlin, Hamburg and elsewhere were raided by police. This was part of an investigation into the ‘forming of a terrorist association to disrupt the G8 summit’ and, under paragraph 129a of Germany’s anti-terrorist law, the supposed ‘membership of a terrorist organisation’, namely the ‘militante gruppe’ (Militant Group or mg) said to have carried out a number of acts since 2001.

The raids backfired and had the perhaps surprising effect of galvanising the mobilisation against the summit. The same evening, more than 10,000 demonstrated against the wave of repression in different cities across Germany, and over the coming weeks many accused the federal prosecutors of having scored an own goal – consolidating rather than dividing the left.

On 13 and 19 June, shortly after the summit, however, another series of raids took place. Again they were justified as part of an investigation into the ‘formation of a terrorist organisation’ – this time said to have committed arson attacks in the German cities of Glinde, Bad Oldesloe and Berlin against military vehicles and a company said to be involved with the arms industry.

Further arrests

A further wave of arrests took place on 31 July and 1 August. During the night, three people, Axel, Florian and Oliver, were arrested for supposedly attempting to set fire to four German military vehicles on land owned by the company MAN in Brandenburg, near Berlin. They too were accused of membership of the mg.

Shortly after their arrests, the private flats and in some cases the places of work of a further four people were searched. One of those whose homes were raided, Andrej Holm, a sociologist based at Berlin’s Humboldt University, was also arrested under paragraph 129a. The reason given for the four’s suspected involvement with the mg was that during their time as students, or while working on their PhDs, they had developed the ‘intellectual capabilities’ to be able to write the group’s ‘relatively demanding’ texts. Free access to libraries was supposed to have allowed them to carry out the necessary research, and the use of phrases such as ‘gentrification’, ‘inequality’ and ‘precarity’ were said to have appeared in both the mg’s texts as well as the academic work of at least some of those accused.

The only material connection between Axel, Florian and Oliver and the other four were two allegedly ‘conspiratorial’ meetings between Florian and Andrej. The fact that Andrej is said not to have taken his mobile phone with him to the meetings is cited as indicating its suspicious nature.

Media frenzy

Upon arrest, Axel, Florian and Oliver were flown by helicopter, amidst a media frenzy, to the supreme court in Karlsruhe before being remanded in custody at Moabit prison, Berlin, where they currently remain awaiting trial. The police have since been accused of using excessive force while placing the three under arrest. Andrej Holm was also initially remanded in custody.

The prisoners have been held in solitary confinement in cells of six to eight square metres in size. At least one of them has had extremely restricted access to showers, on the basis that his isolation can not be guaranteed in the washroom. The accused have only been able to communicate with their lawyers through glass partitions. Severe restrictions have been placed on the number and frequency of visitors that they are allowed to receive.

Having received worldwide support from both social movements as well as hundreds of critical social scientists who have demanded his release, Andrej Holm was eventually freed from prison on 22 August. He continues to face serious restrictions on his movement and the prosecution is appealing against his release. The appeal will most likely be heard in October.

‘German Autumn’

This year sees the 30th anniversary of the so-called ‘German Autumn’, the climax of the cycle of violence and counter-violence between the German state and the leftwing urban guerrilla group, the Red Army Faction (RAF). It makes the climate rife for instilling a fear of the ‘resurgence of terror’ – with a widely expanded definition.

Fortunately, the collective memory of the left and liberal-left from this period is (mostly) strong enough to keep in mind the means by which the terror discourse can serve a ‘divide and rule’ function – encouraging splits between the movement’s ‘moderate’ and ‘extreme’ ends. The result of such splits, of course, always lead to a redefinition of what constitutes ‘legitimate’ dissent and what does not. More and more forms of resistance to the status quo begin falling within the single term: ‘terror’.

The broad and growing movement against the wave of repression has three principal demands: freedom for the three remaining prisoners, solidarity with all of those facing charges and the abolition of paragraph 129a.

For more information, in both German and English, see http://einstellung.so36.net

There have been numerous attempts both from outside the SPD and by left SPD members to break away and found a new party, but they all failed. No matter how far the SPD might move to the right there was, it seemed, no possibility of establishing a left party that could stand its ground. It was as if the SPD’s monopoly of working class politics was written in stone.

As a legally, formally constituted party, Die Linke (the Left) is still only a few weeks old, but it has already had a sizeable impact. At the 2005 federal election, standing as a coalition of the Party of Democratic Socialism (PDS), with its roots in East Germany, and Labour and Social Justice – the Electoral Alternative (WASG), coming from the west, it obtained 8.7 per cent of the vote, gaining 54 seats in the German parliament. In eastern Germany, it has reached about 25 per cent at state elections. In Berlin it is part of the government with the SPD. In Bremen, the smallest German state, the party entered the state parliament with 8.4 per cent of the vote.

All current national polls see Die Linke above 10 per cent of the vote.There is a steady flow of SPD members switching to the party, especially trade unionists. Formally launched on 16 June 2007 with 71,800 members (60,300 from the PDS and 11,500 from WASG), it attracted about 2,500 new members in the first week of its existence.

What kind of a party is it? Can it become a new political force, changing the German party system forever? What is the source of its sudden strength?

The legacy of the German divide: the east

Die Linke is a fusion between two older parties, overcoming the historical divide between east and west.The PDS, the Party of Democratic Socialism, was founded in 1990 in the former German Democratic Republic (GDR). After the Berlin wall fell and the GDR ceased to exist, the progressive and democratic parts of the state’s single political party, the SED (Socialist Unity Party of Germany), decided to build a new party, the PDS. The PDS broke from the ideology of Marxism-Leninism, from state socialism and authoritarian political organisation but worked with the practical, organisational legacy of the old SED.

In the reunited Germany of the 1990s, the PDS established itself as a major political force in the five eastern states and in Berlin, divided in the cold war between the east and west.The PDS appealed both to the material impoverishment and moral mortification that many east Germans experienced in the unified but westerndominated Germany, and to former GDR citizens’ experience of positive features of their past system.

Coming from a system that had raised ‘spin-doctoring’ to an art form, suppressing every failure and problem, the former GDR citizens were all the more disillusioned when west German parties promised prosperity but then carried out economic policies that led to economic and social decline in the east.The PDS became a kind of civil rights party for the eastern citizens of Germany. It developed a very practical reform-focused politics rooted in the problems of everyday life.

In the ten states of western Germany, however, the PDS was unable to become a significant political force. It was so identified with the GDR that it couldn’t overcome its image as purely an ‘eastern’ party however sharply it tried to distance itself from that history. Since two thirds of German voters live in the west, the PDS never achieved more than about 5 per cent of the vote at the federal elections. Indeed, in 2002 it fell below the 5 per cent minimum for representation in the national parliament.

The legacy of the German divide: the west

The other half of Die Linke was founded in the western states. Its origins go back to disillusionment with Gerhard Schröder’s ‘red-green’ government, which took over in 1998 after 16 years of chancellor Helmut Kohl.This followed a course very similar to that of Tony Blair and New Labour. Its ‘job market reforms’ hit German people as a hard shock and during the eight years it was in power, poverty and insecurity increased on a scale unprecedented in the era of the welfare state.The new government also led Germany to war for the first time since 1945, actively participating in the military action in the former Yugoslavia in 1999.

The SPD went on to lose hundreds of thousands of members and millions of voters. For the left of the Social Democrats, it became almost impossible to remain loyal to the party. Party members were willing to accept some harsh consequences of global competition and had recognised the need for compromise. But what many members could not cope with was the fact that the party’s leaders treated the unemployed, the low paid, manual workers and the poor in general as the new outcasts, self-inflicted losers, the ones too dumb to catch up. For anybody who had any sense of a class instinct, the SPD was simply no longer a home.

After the re-election of the SPD-Green coalition in 2002 and no sign that the government was reconsidering its course, preparations began for a new left party. The final decision was made in circles close to the two biggest trade unions – the metal workers’ union, IG Metall, and the public services trade union, ver.di. For them a new left party would be a means to put pressure on the SPD.The new party was called Labour and Social Justice – The Electoral Alternative (WASG). It was a mixture of trade unionists and ex Social Democrats on the one hand, and people from radical left groups and social movements on the other.

In the first state elections in which it participated, those of North Rhine- Westphalia, the new party proved that it could hurt the SPD but would most likely share the fate other left-of-SPDparties in the past.Though the SPD lost heavily, the WASG achieved only 2.2 per cent of the vote and the PDS 0.9 per cent.There seemed little likelihood that the WASG could win representation at federal or state level. The laws of German politics would, it seemed, remain unbroken.

Flunking the written: the new party

After the SPD’s dramatic defeat in North Rhine-Westphalia, one of its traditional strongholds, Gerhard Schröder decided to go on the offensive. He brought forward the federal elections to 2005. One reason was to try to ensure that the WASG initiative would be stillborn.The WASG was inexperienced and would have great difficulties in setting up an effective campaign in so short a time.

Schröder’s strategy did not take account of an old personal enemy, however. Oskar Lafontaine, a former SPD chairman and minister of finance until his resignation in 1999, announced that if WASG and PDS would run for the election together, he would offer himself as front-runner.WASG and PDS accepted this as the only chance of gaining federal representation in the 2005 elections.They went to the elections under the label ‘the Left’ and won a surprisingly strong 8.7 per cent of the vote.The two parties then decided to go one step further and fuse into a new party of the same name.

It took two years to implement this decision. Fusing two parties is an extremely difficult process in the German political system. Meanwhile, polls and elections like the recent one at Bremen state have proven that the new party is both stable and electorally effective. For the first time since 1945, a party to the left of the SPD and the Greens has been established.

Why is it possible to ‘flunk the written’ now when it has previously proved impossible?

There are three major reasons.The first is that the shift to the right of the Social Democrats and the Greens has opened a huge space, leaving thousands of activists and millions of voters without proper political representation.

The second is that Die Linke has been able to challenge effectively the prejudices that people have against the idea of a left party.The party has shown it can work together. Its activists put aside internal fights and power struggles.They have created a party that is neither a purist ideological enterprise nor simply an exercise in realpolitik.

The third reason is that the process of fusion at ground level has led everyone to accept a much higher degree of plurality, diversity and equality than you would normally find in a left party – a precondition for success in a complex society with very different social experiences and political traditions.

The future of Die Linke depends on these conditions continuing to hold. But on the basis of the foundations created so far this will be measured not in years but in decades. It is written.

The West German welfare state was not a philanthropic institution; rather it became conceivable only under a set of highly specific historical circumstances.

-# A drastic shift in the balance of social and political forces – national and international – as a consequence of the Second World War which favoured those arguing for social-welfare and democracy.
-# A prolonged phase of economic growth, supported by a Keynesian strategy, which was also pursued by conservative governments.
-# Competition with the German Democratic Republic, which generated an enduring pressure to demonstrate the superiority of the West.

Salami tactics against the welfare state

By the late-1970s, the Keynesian project had already begun to show signs of stress, and a political and socio-economic change became evident – initially tentatively and fairly muted when compared with British Thatcherism. In the late-1980s, the fall of the Berlin Wall and the end of the Cold War revoked the global framework within which German post-war development had taken place. As a consequence, the neo-liberal project in Germany did not begin to become dominant until the mid-1990s.

However, the first cuts in the welfare state had already been made in the 1980s. By resorting to salami tactics, over a decade or so the entitlements of those on unemployment benefit and income support have been steadily trimmed back. At the same time, as a consequence of two decades of rising unemployment, there has been a serious deterioration in the financing of the health, pensions and unemployment benefit systems.

Although the costs of running the welfare system, measured as a proportion of Gross Domestic Product, have only risen marginally over the longer term, unemployment has exposed the Achilles heel of the German system: the financing of the welfare state rests on contributions levied on income from employment, in contrast to systems financed via taxation. And with an average official rate of unemployment of 10% (20% in East Germany), this source of income is at an historic low.

In addition, the social costs of German unification – that is, the integration of 17 million East Germans into the welfare system – was also financed not from taxation but from the funds based on social insurance contributions. Since 1990, around EUR75 billion a year has been transferred annually from West to East.

However, attempts by the Kohl government to make deeper cuts in the welfare state were thwarted by resistance from the – then opposition – Social Democrats and trade unions.

The German version of ‘New Labour’

The change of government in 1998 changed all that. Following an initial period in which a number of measures taken by the Christian Democrat government under Helmut Kohl were reversed – such as limits on sick pay – the resignation of the Social Democrat Finance Minister Oskar Lafontaine in March 1999 paved the way for a swerve to a neo-liberal approach on the part of the Social Democrats.

Under the catchphrase ‘New Centre’, Social Democrat policy began to mutate into a German variant of Blair’s ‘New Labour’, the ideological roots of which were set out in the so-called ‘Blair-Schröder Paper’. Economic, finance, tax, employment and social policy all took on a neo-liberal complexion. The ‘biggest tax reform of all time’, carried out by Schröder in his first period of government, followed the neo-classical dogma that tax cuts for business would create more jobs. Although the reform poured some ¬50 billion into the coffers of businesses and the well-off, it did not create a single job and failed to kick start the economy.

The partial privatisation of pensions has also proved to be a flop. The crash on financial markets has led to insecurity and scepticism about pensions financed by stock market investment.

‘Agenda 2010′ – most serious attack on the welfare state since the war

Germany’s economy has been virtually stagnant for three years – with zero growth expected for 2003, the lowest in the European Union. At the same time, the financial crisis of the welfare state has intensified, compounded by an austere fiscal policy and the pro-cyclical impact of the European Stability and Growth Pact. Germany’s social and material infrastructure has begun to deteriorate. The impact of the decline in public demand, especially on infrastructural spending, under the impact of unemployment, cuts in social provision, and a general sense of crisis, has been intensified by the falling demand on the part of private households. In the absence of a change in direction, recession could lurch into a deflationary crisis.

Against this background, the government has looked for salvation by dramatically stepping up its neo-liberal approach. In March 2003, Chancellor Schröder announced ‘Agenda 2010′ – a social and economic programme representing the most severe attack on the welfare state since the Second World War. It constitutes a fundamental change of course which will ultimately liquidate what has been dubbed as ‘Rhineland Capitalism’. Schröder has already indicated that ‘Agenda 2010′ is just the beginning of a much more far-reaching process.

The ‘reform package’ embraces a range of measures in the field of taxation, the labour market, pensions, and health.

Fighting the unemployed instead of unemployment

The core of the policy on the labour market is the cutting of the period of entitlement to unemployment benefit from 32 months to 18 months for those aged over 55 and to 12 months (previously 24) for those below 55, together with a merging of two other welfare payments – unemployment assistance (paid after unemployment benefit has expired) and income support, both of which are means-tested. In the first period of unemployment, unemployed people receive around 60% of their previous net income in the form of unemployment benefit. Unemployment assistance, the level of which has already been lowered in recent years, which follows on from this will now be cut to the level of income support and merged with it for administrative purposes: income support is the lowest benefit paid out in Germany, and is designed to offer the minimum necessary for existence. At present there about 4 million recipients. In the last 15 years, benefits under the income support system have been steadily lowered and are now below the EU’s definition of subsistence minimum of 50% of average income.

In addition, the requirements on unemployed people to accept a job offer from the state placement system have been tightened, so that almost any work will have to be accepted, regardless of how poor the pay and conditions. The efficiency of the job placement system will also be improved, and measures introduced to promote new small-business start-ups.

The essence of the measures is clear: cost cutting at the expense of the unemployed. Because there are almost ten times more unemployed people than there are vacancies, these measures will do little to cut the high rate of unemployment.

Under another proposal, protection against unfair dismissal will also be reduced, under the slogan of ‘improving labour market flexibility’. Workplaces with fewer than six employees, which are not currently covered by employment protection legislation, will in future be able to hire a number of workers on fixed-term contracts without this bringing them within the scope of the law. The exclusion of employees on social grounds from redundancy programmes will also be allowed only on grounds of age, length of service, and need to support dependants. Industry-level collective agreements will have more scope to respond flexibly to changing economic circumstances

Old age poverty now a certainty

The core of the pension reform consists essentially in raising the retirement age from 62.5 to 65 years and cutting pension benefits. At the same time, time spent not paying contributions – but which have previously been counted as pensionable employment – such as three years for study, will be cut. The measures will lead to an increase in pensioner poverty within a few years, and, as a result of a longer working life, to more unemployment.

Health – because you’re poor, you must die sooner

Sickness benefit, which is paid from the sickness insurance system once an employee’s entitlement to sick pay has expired, will in future be financed solely by employee contributions. Many benefits, such as dentures and glasses, will have to be paid for in full by the patient. Prescription charges will be raised, and patients will have to pay a quarterly fee of EUR10 to have a right to visit their doctor. Maternity benefit will be cut entirely as a benefit financed out of the statutory sickness insurance system. Patient charges for medicines will also be changed, but with some reductions for the long-term sick and participants on structured preventive and treatment programmes.

The life expectancy of lower socio-economic groups is already 10 years below those in better-off groups. The additional financial burdens will mean a return to the grim truth of the nineteenth century: ‘Because you are poor, you must die sooner’.

Tax and local government finances

A further major tax cutting programme is envisaged, intended to cut tax for middle and lower income groups. However, this will be more than offset by new burdens – such as higher health charges. At the same time, there are plans to introduce a tax on earnings from interest. In the wake of the reform of local government finance, the yield from trade tax – which is levied locally – will rise and the number of those liable to tax will be extended. This will not, however, hit those starting new businesses or running small businesses.

A programme of providing cheap loans for local authorities will be provided via the Bank for Reconstruction and additional economic impulse is expected from a programme for building and modernising homes. Regulations governing the operation of traditional trades are to be reformed, and bureaucracy reduced.

Trade unions and the Social Democrats face prospect of divorce

For over a century, the German trade unions have pursued a strategic alliance with the Social Democratic Party (SPD). Eighty per cent of full-time union officials are SPD members, and the general secretary of the construction workers’ union is even a member of the SPD parliamentary group.

After the war, the trade unions pursued a strategy of corporatist inclusion in the welfare state – an approach which served them well for several decades. However, the switch to neo-liberalism triggered a period of crisis, expressed in declining membership and diminished influence on both politicians and the broader public. Alongside their own problems of bureaucratisation, tardy reaction to the structural problems of unemployment and the demands of modernisation, as understood by neo-liberals, German trade unions have also been confronted by an extremely hostile media, which has conjured up an image of fossilised opponents of reform and die-hard dogmatists. Given this, it is hardly surprising that in the summer of 2003, the metalworkers’ union IG Metall – still the largest manufacturing union in the world – suffered its first industrial defeat since the mid-1950s.

In the election campaign of 1998, the trade unions strongly supported the SPD leadership duo Schröder and Lafontaine. Although the relationship deteriorated after the departure of Lafontaine, there was still clear – if muted – support for Schröder in the 2002 election campaign. However, ‘Agenda 2010′ has shaken the relationship so severely that the historic alliance is to all intents and purposes broken.

The largest trade unions – ver.di (for the service and public sectors) and IG Metall – are in open conflict with the government, have engaged with the issues raised by social movements, in particular ATTAC, and increasingly co-operate with them. The same applies for the education and construction unions. At present, those forces which argue for more autonomy and closer co-operation with the social movements have achieved a predominance. In other trade unions, such as the chemical and mining union IG BCE, and within the central union confederation, the DGB, there are still widespread illusions about the unions’ capacity to prevail with the government via dialogue and lobbying. As a consequence, the future strategy remains in contention – and emancipation from the SPD will be a contradictory and protracted process. Should there be a definitive breach – something which is entirely possible – this would be a truly historic development in Germany.

Protest takes shape

The SPD’s swing to neo-liberalism – a step already undertaken by the leadership of the Greens – has meant that parliament in effect is dominated by a neo-liberal all-party coalition. Opponents of this approach lack any parliamentary representation. Those few SPD members who have dared to voice opposition have been brought into line with massive pressure, including threats of resignation on the part of Schröder. There has not been an SPD left capable of independent action for some time.

For the opposition Christian Democrats and Liberals (FDP), the ‘reforms’ do not go far enough. Their calls for more far-reaching measures also have a good chance of being realised as the Conservatives control the Upper House, in which the fifteen constituent states of the Federal Republic are represented and whose consent is required for some types of legislation – including much of ‘Agenda 2010′. As a consequence, in order to get its legislation through, the SPD will need to make concessions.

The post-communist PDS (Party of Democratic Socialism) also lacks any real oppositional power. Although it has now transformed itself into a social democratic party and holds positions which the SPD took up in the 1970s, it failed to clear the 5% hurdle required for full parliamentary representation in proportion to its vote, and has just two members in the Lower House, the Bundestag. Moreover, the PDS is in a coalition with the SPD in two regional governments in East Germany – Berlin and Mecklenburg-West Pomerania – where it has pursued policies along the same lines as ‘Agenda 2010′.

Against this background, and with some delay, a non-parliamentary protest movement has begun to take shape, organised by grass-roots union organisations, anti-globalisation movements, and various left currents. There have been student strikes at several universities against cuts and the introduction of tuition fees, and an increasing number of actions against social welfare cuts.

The biggest success was a demonstration on 1 November in Berlin, which – to the surprise of many – attracted 100,000 participants, despite little advance preparation and a notable lack of support on the part of the trade union leadership. The demonstration was called by ATTAC, local union branches, and left organisations. The success of 1 November shows that there is a broad popular discontent and willingness to protest which has no outlet in the established political system.

This has broken the spell which so far seemed to have blocked any form of mass mobilisation. The Berlin demonstration is a signal for all those who have so far held back. It has already had some impact on the leadership of ver.di, IG Metall and other unions – where the issue is less that of a rejection of trade union mobilisation, but rather fear of more defeats which could put unions even more on the defensive. The experience of 1 November may have begun to change this.

Even the DGB has begun to show that it is prepared to participate in future actions against cuts in the welfare state, not least because it is afraid that it will lose grass-roots support. There is also growing readiness to get involved on the part of other social organisations, individuals within the churches, and the discontented grass-roots of the SPD and Greens. With this degree of impetus, over the next few months a large protest movement could emerge in what is otherwise a conservative country.

In view of the historic turning point at which Germany now finds itself, a decade after the fall of the Berlin Wall, a strong extra-parliamentary movement with a progressive and emancipatory agenda could prove to be a significant factor in the development of this process. And given the significance of Germany for Europe more widely, this would have ramifications beyond Germany’s own borders.Peter Wahl works for the NGO WEED (World Economy, Ecology and Development) and is a member of national co-ordinating committee of ATTAC-Deutschland.

Yet there are more specific things to say about the recent history of the German Greens. This history contains important lessons for the wider debate about the relevance of political parties in struggles for progressive social change and the role of governments in the process of transforming societies.

The 20-year history of the German Greens inevitably raises questions asked throughout the 20th century. What form should left parties take in parliamentary democracies? And should these parties participate in governments that are, at least in part, committed to managing the existing, capitalist economy? The case of the German Greens is especially interesting because they achieved their role in government as a result of success in elections – rather than through deals with other parties.

The German Greens were always highly conscious of their role – mainly because many of the party’s founders had been part of the 1968 generation that strove to reconstruct the historical and theoretical memory of the left that was destroyed by the Nazis.

One key debate was about how far social emancipation could be a matter of party politics as they had been in the 1920s. This debate involved addressing questions of internal party democracy and challenging political scientist Robert Michels’s ‘iron law of oligarchy’.

Michels argued that parties are always doomed to degenerate into apparatuses by which the leadership dominates the mass membership. To counter this effect, the Greens devised the principle of ‘grassroots democracy’. The party developed a strong set of institutional rules to prevent the development of a permanent party elite and to ensure that power spread constantly out to the membership. This would renew the leadership with fresh energies and experience.

If the fate of the German Greens simply vindicates Michels (even when a party consciously works to counter the inevitability of elite domination), then the history of the party would be of little interest. But the failure of the Green left in Germany to maintain its early influence within the wider Green movement and party is far more worthy of attention. It points to key strategic mistakes from which all green and radical activists can learn.

There has always been an electoral aspect to the Greens’ politics. This has been the case at all three levels (federal, regional and city) of the German state. But in itself this cannot explain why the leading Greens eventually allowed themselves to become acquiescent coalition partners with the Social Democrats (SPD) on the federal level. After all, green-left radicalism continued to dominate the party – even (for some time) within its parliamentary group -long after its entry into the federal parliament. It was, after all, a left-influenced proposal of a new social contract bringing ecological, feminist and trade union demands into one radical agenda for reform that helped revive the party’s federal fortunes in 1994.

But it was also at this time that the party’s ‘realists’ gained control of the parliamentary group. They used this control – along with the media presence of their leaders – to extend their ideological influence within the party as a whole. In this way, and by offering career prospects to their followers and allies, the ‘realists’ developed a rather authoritarian culture of subservience to their leaders. They propelled Joschka Fischer into a position of supreme informal authority, which further enhanced their position in the media.

The party’s left wing, in contrast, had few clear ideas about how to use the party’s parliamentary position other than for reinforcing extra-parliamentary mobilisation. Moreover, in terms of policies it had stood still – simply holding fast to ideas that had been developed to counter cold-war ‘extremism’ and which were not applicable to the neo-liberal and neo-conservative policies that dominated The 1990s.

The pressure of the neo-liberal offensive against workers and trade unions undermined the immediate possibility of uniting a large majority of the workforce around the green and feminist policies of less work for everybody. And middle-class green voters were attracted to eco-tax mechanisms as an alternative to more complicated forms of ecological controls on production or consumption. Moreover, the myth that the welfare state was somehow responsible for mass unemployment began to gain a foothold among new generations of greens.

And yet, even in the run-up to the 1998 federal elections that brought the ‘red-green’ coalition into government the Greens ran on a programme that still bore the imprint of the party’s left wing, though the electoral slate and, therefore, the people who would drive the programme did not reflect this political balance.

The original coalition agreement gave some grounds for hope that the new government would introduce real social and ecological reforms. This was helped by the presence of the SPD’s former leader and finance minister Oscar Lafontaine, who had been a main architect of German reform coalition-building efforts in the late 1980s.

The realists soon won a strategic victory, however. They polarised party members against an ‘old-party left wing’ that failed to provide answers to the new challenges of the mono-polar world order under the reinforced power of the US. The spectacular decision of the Greens to support German participation in the Nato war against the Serbs over Kosovo was the symbolic climax of this development.

Other important milestones have been the Green parliamentary group’s distancing of itself from those NGOs and grassroots movements that challenge corporate globalisation, the vanishing of the proposal to reduce working time from Green economic policy, and the abandonment of proposals for political control of ecological transformations in favour of ‘economic instruments’. The party has also replaced radical feminist demands with a policy of ‘gender mainstreaming’ for a minority of career women. Similarly indicative is the compromise the Green Party has made on the slow phasing-out of nuclear energy. This last betrayal led to the breaking away of the anti-nuclear movements from the party.

By 1999 the Greens’ left wing had lost its grip on party congresses and its coordinating structures began to disintegrate. Many activists have left the party, mostly individually. Many have thrown themselves into new organisations like the anti-globalisation initiative Attac or the new protest movement against the war in Iraq. In Germany these new transnational movements have developed without any party political support. Yet again activists are faced with the problem of trying to build real political pressure without having reliable party political counterparts. The same has become true for the trade unions, which have had to look for a new capacity for strategic action without their traditional allies in the SPD.

The Green party’s left wing has not vanished entirely, however. In June grassroots Greens were able to force an extraordinary congress upon the party because of its parliamentary leadership’s attempts to be more neoliberal than Schroeder. The left is still a force to be reckoned with at grassroots level.

When, in 2006, the German Greens come to grips with electoral defeat, voices will be present within the party that will be able to explain how and why the opportunism of Fischer and Schroeder led to defeat for all sorts of demands for social, democratic, feminist and ecological goals. The ‘realist’ strategic idea that the Greens would take the political space of the liberals, while giving it a new ecological and anti-discriminatory edge, has failed.

Hopefully, this will not be the end of the German Greens or Germany’s more radical left-wing forces (who are also in the SDP). But if these left green forces do not develop a new political project that is capable of forming the basis for a broader alliance of social and political forces than the ‘new social movements’ of the 1970s and 1980s, then they will be defeated again. The subsequent emergence of a ‘realist’ hegemony on the left would be grim indeed – and not just for Germany.

Green Party member Frieder Otto Wolf is an ex-MEP and teaches political philosophy at the Freie Universitat Berlin