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German Minister Quits As Coalition Split Grows



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German Minister Quits As Coalition Split Grows
cyrano Offline
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German Minister Quits As Coalition Split Grows

By MARCUS WALKER

BERLIN -- German Economy Minister Michael Glos resigned unexpectedly, allowing for a possible successor more inclined to obstruct Chancellor Angela Merkel's strategy to address the country's worst economic slump in decades.

A leading candidate to succeed Mr. Glos on Sunday was Karl-Theodor zu Guttenberg, a combative conservative from the southern state of Bavaria. The switch reflects growing divergence within Ms. Merkel's coalition as parties compete for profile ahead of national elections in September.

Mr. Glos's conservative Christian Social Union, which rules Bavaria and as part of Ms. Merkel's national government chooses who will be economy minister, has been increasingly confrontational as it seeks to boost its popularity. The politicking could impede Germany's response to its deepest economic contraction since the 1940s. Many economists expect Germany, the world's fourth-biggest national economy, to shrink by 2% to 3% this year.

The chancellor and Finance Minister Peer Steinbrück, of the left-leaning coalition partner the Social Democrats, have dominated German economic policy since 2005. Mr. Glos had struggled to influence Germany's response to the financial crisis or its economic policies. His calls for lower taxes, greater use of nuclear power and more business-friendly labor rules often left him isolated, to the right of government policy.

Ms. Merkel has instead governed from the center and sought consensus with the Social Democrats. Before the financial crisis hit Germany in the fall, her priority was to balance the budget rather than cut taxes. When she and Mr. Steinbrück drew up a fiscal-stimulus plan in recent weeks to fight Germany's worsening recession, they gave priority to spending on infrastructure and expressed doubt about whether tax cuts would work.

The Christian Social Union's chairman since October, Horst Seehofer, has been looking for new, younger faces to represent the party. Mr. Glos, 64 years old, cited his age and his party's need for renewal in offering to resign.

The CSU lost its decades-old absolute majority in the Bavaria state legislature in the fall. Mr. Seehofer has since tried to raise the party's influence in national affairs through a series of confrontational stances.

The Bavarian party threatened to block a €50 billion ($64.63 billion) government fiscal-stimulus plan in January unless it included some tax cuts, forcing concessions from Ms. Merkel.

The party has also made additional tax cuts a precondition for a joint election campaign in September with Ms. Merkel's Christian Democrats, who are the main conservative party in the rest of Germany.
02-09-2009 05:00 PM
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