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Steinbrueck Says Merkel Misleading Voters on Debt Crisis

Aug. 9 (Bloomberg) -- German chancellor candidate Peer Steinbrueck criticized Angela Merkel for misleading voters over the true cost of the European debt crisis, saying that he’ll be upfront about the policy decisions needed after fall elections.

Steinbrueck, Merkel’s Social Democratic challenger in the Sept. 22 ballot, used the first rally of his campaign to make a virtue out of his reputation for straight talking. Addressing a crowd of about 3,000 in Hamburg yesterday, he contrasted his direct approach with Merkel’s “lulling” of voters on policy areas including energy, the economy and Europe.

“Germany will have to come to Europe’s help and foot the bill if necessary,” the SPD challenger told supporters, many eating sausages and drinking beer. “But that’s something Mrs. Merkel won’t tell you. It’s not enough to simply beat other countries over the head with the cudgel of saving; we need growth too.”

Steinbrueck, 66, has little more than six weeks to persuade voters he is better able to steer Europe’s biggest economy than Merkel, 59. While polls show Germans approve of the chancellor’s handling of the crisis, recent surveys suggest that Steinbrueck has begun to whittle down her Christian Democratic bloc’s lead.

Merkel, who is the focus of her party’s election campaign, returns from her vacation to official engagements on Aug. 13 and is due to hold her first rally the next day in Hesse state.

‘Straight Talking’

Stealing a five-day march on Merkel, Steinbrueck chose Hamburg, his hometown and the only one of Germany’s 16 states where the SPD has an absolute majority, to try out his new format “Open Air Straight Talking” tour.

Merkel’s first-term finance minister was buffeted early on in the campaign by revelations of his earnings from speaking fees and remarks that made him seem out of touch with his party: he said the chancellor’s 220,000-euro ($294,000) annual salary was too low and that he avoids wine that costs less than 5 euros a bottle.

Speaking from a podium under a circular awning resembling a circus tent without walls, Steinbrueck blasted Merkel’s bloc for having “no idea about money,” saying that her coalition has “the worst ministers since German reunification,” and has reached a “stalemate.” The issue of youth unemployment is becoming “explosive” in Europe, he told the audience in the Michelwiese park.

Bank ‘Gambling’

As chancellor in an SPD coalition with the Greens, Steinbrueck said he would move quickly to implement a statutory minimum wage and put a brake on labor leasing. Laws would be implemented to ensure equal pay for women, tax dodgers pursued relentlessly and banking “gambling” subject to more control. He’d abolish subsidies introduced this year for parents who raise their children at home and use the money to finance 200,000 new kindergarten places.

More teachers are needed, “and that will cost money,” so nursing care insurance payments will rise by 0.5 percent, he said. “Saying taxes will rise is straight talking,” even if 95 percent of citizens won’t be affected by the increases, he said.

The rally by the River Elbe was a first indication that the campaign lines are hardening. Policies aside, Steinbrueck says that, unlike him, Merkel is being disingenuous when she touts her defense of Germany throughout the debt crisis that began in Greece in late 2009. Her trumpeting of a balanced budget masks an investment backlog needed for infrastructure, he said.

Getting that message across may be made harder after the German economy expanded “markedly” in the second quarter, according to a government report released today.

Latest Polls

Support for Merkel’s CDU and its CSU Bavarian sister party dropped a point to 40 percent in the latest Forsa poll released Aug. 7, as the SPD gained a point to 23 percent. The Greens had 14 percent, also up a point, and Merkel’s Free Democratic coalition partner held at 5 percent.

The CDU/CSU and FDP have a combined 44 percent to 47 percent in the five polls published so far this month. That compares with 37 percent to 41 percent for the SPD and Greens. Forsa polled 3,003 voters between July 29 and Aug. 5, with a margin of error of as much as 2.5 percentage points.

Harald Zulauf, 47, who listened to Steinbrueck in the park, said he was impressed with his ability to speak without notes, though he would have liked to be allowed to ask questions of the candidate. Steinbrueck, he said, “has to look optimistic given the miserable polls.”

To contact the reporter on this story: Arne Delfs in Berlin at adelfs@bloomberg.net

To contact the editor responsible for this story: James Hertling at jhertling@bloomberg.net

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