A cold wind spoils Mr Schroeder's new stance

`He no longer speaks as a wannabe Blairite but as a reincarnation of Mr Lafontaine'

IT MUST be pleasing to certain sections of the British press to see a German leader adopting Bismarckian poses. In the last few days Chancellor Gerhard Schroder has done his level best to live up to the caricature German leader, the one who is always trying to impose his will on others.

In his guise of saviour of the German firm Mannesmann from the clutches of Vodafone, he has tilted against the windmills of Anglo-American capitalism. The message: takeovers are good when a German company gobbles up a foreign firm, but terrible the other way round - they damage society.

Then he picked a fight with his own business elite, helping to refloat the failed construction firm Holzmann, to the obvious delight of his left- wing constituency.

He has done this kind of thing before, oiling the wheels of business, saving jobs with taxpayers' money. It goes down well in Germany.

But the manoeuvre has earned the wrath of Wim Duisenberg, the head of the European Central Bank. He has come out openly attacking the German Chancellor for interfering with market forces. Yet Mr Schroder soldiers on. Oblivious to the effects of his deeds on the feeble euro, he opened another front yesterday, laying into that nice Tony Blair who was supposed to have been his closest ally. And he is doing it with words no post-war German politician, save Oskar Lafontaine, would have dared to employ. Britain, he declares, is "intransigent", and British opposition to a harmonised tax policy is damaging Europe. The euro promptly falls.

In other words, he is no longer speaking as a wannabe Blairite, but almost like a reincarnation of Mr Lafontaine - that darling of Social Democrat party conferences who was booted out by Mr Schroder last March. It may just be pure coincidence that the party is gathering again next week for another conference, where the Chancellor is hoping to mend fences with the majority of members, who loathe him. He has watched Mr Lafontaine dazzle the faithful with rousing speeches about international speculators, tax fraudsters and greedy Anglo-Saxons. If it worked for Oskar, it may work for him.

It probably will not, though, because, say what you like about Mr Lafontaine, he really believed in all that, and Mr Schroder does not. Or if he does now, it is a safe bet that he will not by this time next week, once party delegates are safely home from their national jamboree.

Germany is changing, and not just in its exposure to the cold winds of international capitalism. Three months after the move from Bonn to Berlin, politics is being blown part by a gale of scandals. The Berlin Republic is enveloped in the stench of corruption, the like of which has not been seen in Germany for decades. Helmut Kohl, the embodiment of petit-bourgeois rectitude as well as the icon of statesmanship in re-unification, has been caught running his party accounts with methods the Germans call "Italian". He took money from God knows what companies and hid it in slush funds, doling out the loot, by his own admission, to political friends in need.

Such were the ways of the incestuous little Bonn Republic. After a hard day's work at the Bundestag, the politicians could relax at their favourite pubs in the evenings, often in the company of their favoured journalists. Privacy was assured; briefings in the back room could be guaranteed never to reach the general public.

Now this system has broken down. Berlin is turning out to be a difficult city in which to keep things secret, partly because of a lack of suitable facilities. There are no pubs within walking distance of the Reichstag that have back rooms; no place to have that friendly private chat with reporters, well away from prying eyes.

The non-aggression pact that has governed German political life for five decades is being violated by all sides. Christian Democrats immersed in Mr Kohl's sleaze are outing Social Democrats on the take, such as Gerhard Glogowski, forced to resign last week as Prime Minister of Lower Saxony. That is Chancellor Gerhard Schroder's home region. The Christian Democrats are helpfully suggesting that the press start digging around there, hoping that some dirt can be dug up on the Chancellor.

Where will it all end? It is clear that some senior politicians, perhaps even the entire political class, will be discredited. The organic link between government and business will be weakened, as their under-the-counter dealings come under scrutiny.

Already, the rules are changing in the economy. Despite the protestations of the Mannesmann board and Chancellor Schroder, for the first time a large German corporation may be swallowed up up by a foreign firm. Euroland, and the rapid shift to Anglo-Saxon practices within the private sector, are conspiring against the smug political-industrial complex called Deutschland AG.

From emulating Tony Blair, Gerard Schroder is becoming a John Major, lurching his way from crisis to crisis until the electorate calls time on his lack of leadership. Given the effect of the Kohl scandal on the opposition, that may be later rather than sooner.

In the meantime, Germany is headed for upheavals in all walks of life, and some will be traumatic. But that is the price of running an open society, something that Germany has never had. "Normality" is what post-war Germans have been aspiring to, and there is nothing more normal than politicians, even living monuments such as Helmut Kohl, being pulled off their pedestals. Berlin promises to provide a breath of fresh air.

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