SPD CHAIRMAN BECK THROWS RED MEAT TO THE PARTY'S

C O N F I D E N T I A L SECTION 01 OF 02 BERLIN 001853

SIPDIS

SIPDIS

E.O. 12958: DECL: 10/05/2017
TAGS: GM PGOV PREL
SUBJECT: SPD CHAIRMAN BECK THROWS RED MEAT TO THE PARTY'S
LEFT


Classified By: Charge d'Affaires John M. Koenig for reasons 1.4 (b) and
(d)


1. (C) Summary: In the weeks before the SPD's October 26-28
national convention, and with an eye toward the 2009 election
campaign, SPD Chairman Kurt Beck is attempting to calm the
SPD's unruly left wing with gestures that symbolize a partial
repudiation of the centrist economic policy of former
Chancellor Schroeder. Beck has suggested extending the
duration of unemployment benefits to older workers, a step
that would reverse a part of Schroeder's Agenda 2010 program.
In doing so, Beck has ignited a debate with the centrists in
his party, most notably Vice Chancellor and Labor Minister
Franz Muentefering. Beck's move is likely an attempt to
improve his political standing before the party convention,
which will largely be a referendum on his leadership. There
are no indications (yet) that this leftward shift will affect
Beck's supportive position on Germany's military deployment
in Afghanistan -- in some ways, the leftward shift on social
policy probably is designed to balance the SPD leadership's
support for Operation Enduring Freedom. End summary.


2. (U) In recent statements, Beck signaled that he
increasingly is positioning himself closer to the SPD's left
wing. Beck called September 30 for an extension of
unemployment benefits to 18 months for those over the age of
45 and to 24 months for those over 50 -- this would revise a
key component of the "Hartz IV" labor market reforms that
Chancellor Schroeder and his red-green government instituted.
Additionally, Beck has made a point of preserving the left
wing term "democratic socialism" in the party's new platform.
This leftward shift indicates that Beck is distancing
himself from the centrist Agenda 2010 plan of the Schroeder
government in an attempt to characterize himself more as a
champion of workers' interests. Schroeder himself initially
criticized Beck's course but stated publicly October 3 that
Beck had his support.

Exorcising the Ghost of Schroeder?
--------------


3. (U) Since the emergence of the newly consolidated party
"The Left" earlier in the year, the SPD has wrestled with the
question of its identity. The left wing of the party, led by
figures such as future deputy chairwoman Andrea Nahles, has
suggested that the SPD should demonstrate a clearer
commitment to social justice and ensure "a fair share of the
(economic) upswing" goes to the working class. Others, such
as future party deputy chairmen Finance Minister Peer
Steinbrueck and Foreign Minister Frank-Walter Steinmeier,
have advocated the continuation of Agenda 2010. These two
ministers, along with former party chairman Matthias
Platzeck, published a book at the end of September that
articulated this proposal. Arguing that the SPD can make
more gains in the center than on the left, current deputy SPD
chairman Jens Bullerjahn said, "We will never be able to
outflank The Left party on the left."


4. (C) In response to Beck's proposal to extend unemployment
benefits, Vice Chancellor Muentefering expressed opposition
and suggested that Beck "continue the path (Agenda 2010)
which has thus far been very successful." Despite
Muentefering's firm public stand against Beck's proposed
policy shift, a high-ranking advisor to Muentefering told
Embassy Berlin that, although the Vice Chancellor will hold
firm on his position, he would not consider it an issue worth
resigning over; therefore a showdown between the two appears
unlikely. Indeed, Beck's proposal is not very different from
ideas floated within the CDU in the second half of 2006.

Beck Tries to Control the Beast
--------------


5. (SBU) Beck's steps are his latest attempt to quell unrest
in the SPD and shore up his support at a time when his
personal popularity remains very low. Stung by criticism
that he is unable to match the leadership of Chancellor
Merkel, unite the disparate forces within the SPD, and
formulate a plan for victory in 2009, Beck recently
admonished his SPD critics that "I will not tolerate this
s**t any longer." His outburst seems to have achieved one
intended effect -- lately, there have been fewer criticisms
of his leadership style. Instead, the criticism has turned
to the policy arena. His proposal on unemployment benefits
is likely an attempt to placate the party's leftists, such as
Nahles, and also those such as Berlin mayor Klaus Wowereit
(who has urged the party's leadership to consider national
cooperation with The Left party in the future). (Note: Beck
rejects national cooperation with The Left -- some others
view it as the SPD's only realistic hope of governing after
2009 without a partnership with the CDU/CSU. End note.)

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Beck's primary goal appears to be to sharpen his party's
stance on the issues in the run-up to the 2009 elections. A
major policy shift on labor issues, however, may be out of
Beck's grasp since Muentefering and other SPD ministers are
tied by the coalition agreement; departure from the present
course would require painstaking negotiations with the CDU.

Comment
--------------


6. (C) In tossing red meat to the leftists, Beck has pitted
himself against the centrists. His relationship with
Muentefering, never smooth, now appears to be critically
tense. Picking a fight with Muentefering entails some risk;
Muentefering remains highly popular in his home state of
North-Rhine Westphalia, a bastion of support for the SPD.
How forcefully Steinmeier and Steinbrueck defend the centrist
course will also play a key role, as the two ministers have
been unusually quiet on this issue during a week of intense
debate. Managing these relationships will be a major test
for Beck, one of the many issues -- along with electing his
leadership team, defending the platform, voting on foreign
deployments, and resolving the SPD's posture towards The Left
-- that could come to a head at the Hamburg party convention.



7. (U) Embassy Berlin will report on the economic aspects of
the unemployment benefits debate in septel.
KOENIG