`A Fiasco For Germany'

As Kohl's tax reform stalls, CEOs send jobs and capital abroad

Just when it seemed things couldn't get much worse for Germany, they did. Despite forecasts of accelerating economic growth, the country's woes--punishing unemployment, a plummeting currency, and government paralysis--have cast a pall over the summer holidays. Then, in late July, the Bundesbank signaled it might raise interest rates for the first time since 1992. And a political showdown snuffed out Chancellor Helmut Kohl's tax reform package, which business badly needed.

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