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German conservatives appeal to voters with 'stability and renewal' pledge

Kitco News

BERLIN, June 21 (Reuters) - German Chancellor Angela Merkel's conservatives promised tax relief and tight public finances in an advance copy of their election manifesto obtained by Reuters on Monday, but critics questioned how the plans will add up.

The conservatives are looking to the manifesto, entitled "The programme for stability and renewal", to extend their recently regained poll lead over the Greens ahead of a Sept. 26 federal election, after which Merkel plans to step down.

"We need a powerful new start after the (coronavirus) crisis. We want to make the '20s a modernisation decade for our country," a draft of the 138-page programme obtained by Reuters reads. read more

The manifesto is in stark contrast to plans by the Greens to tax the rich to fund a carbon-neutral economy and makes it more difficult for the two parties to form a coalition after September's election.

The conservatives have extended their lead over the Greens to about eight points in opinion polls despite a divisive battle over who should be their candidate to replace Merkel.

In the manifesto, the conservative alliance - or "Union" - promises tax relief and also underlines its commitment to Germany's so-called debt brake, which limits new borrowing to a tiny fraction of economic output.

"It is unclear how all this is to be financed," said Jens Suedekum, professor of economics at the Heinrich Heine University in Duesseldorf. "I expect that after the election the Union will be open to creative financing solutions."

Christian Democrat (CDU) leader Armin Laschet, now the frontrunner to become chancellor, hopes the election programme will see off a fading challenge from the Greens.

"We want to put the economy back on a growth path after the pandemic and raising taxes would be the wrong way," Laschet told a joint news conference with Markus Soeder, leader of the CDU's Bavarian sister party, the Christian Social Union (CSU), on Sunday.

Laschet and Soeder put on a show of unity after a bruising battle in April to be their parties' joint candidate for chancellor, in which the CDU leader eventually prevailed.


The Greens surged ahead of the conservatives in late April after they picked Annalena Baerbock, 40, as their candidate to run for chancellor, with her promise of change capturing voters' imagination. read more

But since then, a regional election setback, criticism over a Christmas bonus payment that Baerbock failed to declare to parliament and a suggestion that Germany should arm Ukraine have hurt the Greens. read more

An INSA poll on Saturday put support for the CDU/CSU at 28%, ahead of the Greens on 20%. The left-leaning Social Democrats (SPD) were on 16%, the business-friendly Free Democrats (FDP) on 13%, the far-right Alternative for Germany (AfD) on 11% and the leftist Linke on 6%.

The latest polls would not give the CDU/CSU enough support to form a coalition with the FDP, their favoured partner, but point to probably just enough support for a CDU/CSU coalition with the Greens, or a Greens-led tie-up with the SPD and FDP.

The conservatives, which are expected to approve their election programme on Monday, want to cap the corporate tax rate at about 25% from just under 30% now.

Reporting by Andreas Rinke; writing by Paul Carrel and Joseph Nasr; editing by Richard Pullin
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