Mr Schröder's reforms will survive, even if he is defeated

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The Independent Online

There are no two ways about it. Chancellor Gerhard Schröder and his Social Democrats suffered a crushing defeat in North Rhine-Westphalia. Their rejection by the voters of Germany's biggest state, after 39 years in power, was a devastating blow to the centre-left, not just in terms of policies and morale but in practical terms as well. The change of power in North Rhine-Westphalia increases the opposition majority in Germany's upper house, making it nigh impossible for the SPD-Green coalition to govern.

There are no two ways about it. Chancellor Gerhard Schröder and his Social Democrats suffered a crushing defeat in North Rhine-Westphalia. Their rejection by the voters of Germany's biggest state, after 39 years in power, was a devastating blow to the centre-left, not just in terms of policies and morale but in practical terms as well. The change of power in North Rhine-Westphalia increases the opposition majority in Germany's upper house, making it nigh impossible for the SPD-Green coalition to govern.

Mr Schröder's immediate decision to set in train the constitutional process that would permit an early election was nonetheless bold. Rather than limp along from week to week, seeking cross-party consensus for every move, he has chosen to cut his losses and seek a new mandate. The contested reforms he has been trying to implement will now be placed before the voters. For a highly unpopular package, which has included swingeing cuts to unemployment benefits and other long-standing social programmes, this is no bad thing.

Indeed, the more closely the prospect of an early election is examined, the more Mr Schröder stands to gain. Were the so-called "red-green" coalition to be re-elected, it would have a more convincing mandate to proceed with these long overdue reforms than it currently has. In 2002, only the barest outline of the reform programme was known and it was largely eclipsed by other issues. Mr Schröder owed his slender majority to his effective exploitation of anti-American feeling over the war in Iraq and to his skill in fostering a sense of solidarity following catastrophic floods. That Edmund Stoiber, who would have replaced him as Chancellor, lacked his popular touch, also worked in his favour.

Almost four years on, however, Mr Schröder has little to show for that victory. The reforms finally came into effect at the start of this year, accompanied by loud grumbling and an increase in registered unemployment as new methods of calculation took effect. Since then, however, Germany's record jobless total has started to decline. If the trend continues, Mr Schröder will be in a strong position to argue that his reforms are on the right track. The figures might be even more favourable by 2006 - but then again they might not.

The element of surprise also places Mr Schröder in a stronger position than the opposition. The centre-right CDU/CSU alliance and its leader, Angela Merkel, had geared themselves for an election in autumn 2006 and Ms Merkel, while an impressive campaigner, has nothing like Mr Schröder's experience or guile. She has faced strife within her party and it is not clear how voters will respond to the prospect of a female chancellor.

Nor, if the Government's economic belt-tightening becomes the main election issue, will Ms Merkel have much to offer by way of consolation. She was party to the current reforms and, in government, would be more market-orientated than Mr Schröder. Her chief appeal, for some voters, might be her tough stance on immigration and her concern about Turkey's accession to the EU. But Germany now has a sizeable constituency of ethnic Turkish voters: there are votes to be lost as well as gained from the politics of xenophobia.

The choice facing German voters is already clear. Have they simply had enough of Gerhard Schröder, almost regardless of other considerations - which is one interpretation of the result this weekend. Or will they have second thoughts about removing him when they weigh the alternative? Mr Schröder may have staked his chancellorship on this election, but the risk for Germany's centre-right- and for Ms Merkel's political future - is as great. Whoever wins, the reforms will go on.

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