One week after the right wing seized control of the Social Democratic Party (SPD), it is now clear what was at stake. The early appointment of Foreign Minister Frank-Walter Steinmeier as the SPD candidate for chancellor in next year’s federal elections, and the hurried change of party leader from Kurt Beck to Franz Müntefering, means the supporters of former Chancellor Gerhard Schröder now have the party once again firmly in their grasp.

When Schröder handed over the chancellorship to Angela Merkel (Christian Democratic Union, CDU) after calling a premature election three years ago, he was reacting to the wave of opposition to his government’s antisocial policies, embodied in the Agenda 2010 welfare and labour reforms. He faced losing control of the SPD, which had been defeated in one election after another and which was haemorrhaging members. But Schröder preferred to bring the CDU to power rather than give way to the pressure from below.

Franz Müntefering, who had taken over the party chair from Schröder one year earlier, in order to keep competing fractions within the SPD under control, resigned shortly afterwards after failing to push through his own candidate as general secretary.

After a short interlude under chairman Mathias Platzeck, Kurt Beck then took over the leadership of the party. Although Beck essentially supported the reform policies, he tried to appease critics by offering some slight ameliorations. Employer associations immediately sounded the alarm, accusing him of being “soft” on welfare reform and demanding the continuation and intensification of Schröder’s course.

Chancellor Merkel, who at the CDU’s Leipzig party congress in 2003 had presented herself as a staunch neo-liberal, also faced increasing criticism and was accused of being too compliant in the face of social pressure.

At the beginning of July, under the headline, “Business Leaders Call for New Welfare Reforms,” the Berlin Tagesspiegel reported a conference of the Federal Union of German Employers’ Associations (BDA). The article noted, “Leaders of the employers’ associations and German industry sharply criticised the policies of the federal government. They accuse the coalition of breaking with the reform policies and are demanding a new Agenda 2020.”

Tagesspiegel cites BDA President Dieter Hundt as follows: “So far, the federal government has not energetically presented the positive effects of Agenda 2010 on business and the jobs market as a success. The effects of the reform policies introduced by former Chancellor Gerhard Schröder (SPD) can only be seen as positive. What deserves criticism, however, is the fact that the body politic is turning away from the continuation of these reforms and thus endangering their success.”

According to the article, Hundt complained that “the government has joined in the Left Party’s negative discussion about supposed poverty.” Concretely, Hundt criticised the extended payment of unemployment benefits to older workers, the recent increase in social insurance contributions as part of the long-term care reforms, the “populist manipulation” of the pension formula and employment minister Olaf Scholz’s (SPD) plans for a minimum wage. Hundt called the planned revision of the Entsendegesetz (which prescribes that foreign companies active in Germany must follow German collective agreements) and the minimum working conditions law a ‘brutal attack on free collective bargaining.’”

Hundt’s tirade on behalf of German employers amounted to a plea for the return of Schröder, who as chancellor ruthlessly implemented the interests of big business against resistance in the general population and inside his own party. Moreover, both before and after his period as chancellor, Schröder maintained the closest links with the captains of industry. So it is safe to assume that there were many telephone calls, secret meetings and deals struck before the Schröder supporters launched their inner-party coup last week.

Meanwhile, Schröder himself has since re-emerged on the political stage. After his resignation as chancellor, he withdrew from politics; his only activity was lobbying for big business, in particular for Gazprom, the Russian energy group. Last week, he proclaimed his return to active politics by announcing his intensive electoral support for his friend “FWS” (Frank-Walter Steinmeier).

In an exclusive contribution to the party newspaper Vorwärts, Schröder wrote: “It is a great joy for me that the SPD’s leading bodies nominated Frank-Walter Steinmeier as the candidate for chancellor. There is no one with whom I have cooperated so closely and in a spirit of mutual confidence.”

According to Schröder, Steinmeier has “courage and the necessary ability to get things done.” That also applies to the “economic and social development of our country,” stressed Schröder, who repeated the mantra of the employers’ associations: “A socially just Germany is only possible if we are economically strong in the face of the international competition.” This, according to Schröder, is the main task of social democracy and represents the sort of policy Frank-Walter Steinmeier promotes.

Intensified attacks

The putsch by Schröder’s supporters means not only a return to the past policies of his Agenda 2010, but an intensification of the attacks on the working population. It heralds a new round of brutal attacks on social rights, with the SPD reacting to the rapid worsening of the international economic and political crisis.

In an article headlined “World economy in fear,” the Süddeutsche Zeitung recently commented on the effects of the American banking crisis: “The rest of the world has been affected more seriously than was previously believed. The European Union Commission had only just revised its prognosis for the growth of the Eurozone down from 1.7 to a lean 1.3 percent this year.... There are alarming signs: the recession has already begun in Spain, whose real estate crisis is comparable to that of the US; in Italy, political and economic stagnation are going hand in hand; Britain is experiencing the sharpest breakdown for decades; in Germany, the business climate is as bad as it has been for a long time.”

In addition, there is the fraught situation in the Caucasus following the war in Georgia and the US government’s expansion of the war in Afghanistan to neighbouring Pakistan. In both regions, Germany is pursuing its own interests—both geo-strategically and in relation to energy policy—and is increasingly following in its former footsteps as a great power in the region. In his article in Vorwärts, Schröder praises Steinmeier with the words: “I see in him a strong personality who embodies a modern and self-confident Germany, who is quite conscious of his own significance and role.”

The Agenda 2010 policies and Germany’s military deployments abroad are deeply unpopular; they will unleash fierce conflicts and class warfare, for which the SPD right wing and the employers’ associations are now preparing. They want to be sure that they have the party firmly in their grip and that it does not cave in and adapt to any social resistance.

Müntefering and Steinmeier offer the best guarantee for this. Müntefering is a man of the apparatus. He looks to support from SPD functionaries and the trade union apparatus and the many tens of thousands of officeholders and state functionaries who owe their cushy posts to the SPD. Steinmeier has pursued his own political career in Schröder’s footsteps, rising to the highest government offices without ever standing in an election. Both are, to a large extent, immune to the pressure of the general population.

The recent appearance of Friedrich Merz (CDU) in the Hesse state capital Wiesbaden must also be seen in the same light as the right-wing putsch inside the SPD. After a dispute with the chancellor at the beginning of the year, Merz had given up his positions as chair of the CDU parliamentary faction and spokesman in the CDU for big business, withdrawing from politics.

Now, just a few days ago, he appeared as a speaker at the traditional autumn conference of the FDP parliamentary faction. During a “festive dinner” in the opulent conference surroundings, Merz explained why poverty could only be fought through the further dismantling of the welfare state. Only by “limiting the welfare state” could people be prevented from relaxing in a “social feather bed.”

The role of the Left Party

It is quite likely that the Left Party will be able to profit from the rightward turn of the SPD. In the past 18 months, the Left Party has cleared the 5 percent hurdle in all the state elections it has contested and is now represented in 10 of Germany’s 16 states. It would be naïve, however, to think that the SPD has not taken this into account. They need the Left Party as a safety valve and lightning rod.

The SPD is relying on a division of labour. It is determined to drive forward the social attacks, with the support of the party apparatus and the trade unions. The role of the supporters of Oskar Lafontaine and Gregor Gysi in the Left Party is to channel the resulting protest to ensure it does not get out of control.

Unlike the conclusion drawn by many commentators from the SPD’s lurch to the right, this does not preclude it forming a government coalition with the Left Party. A staunch right-wing SPD leadership would guarantee that an SPD-Left Party or an SPD-Green Party coalition would not give way to the pressure from below.

The readiness of the Left Party to collaborate in such a government has already been shown over the last seven years in the Berlin city legislature, where, particularly in the east of the city, the Left Party is responsible for suppressing social discontent, while Thilo Sarrazin, the SPD minister of finance and a right-wing provocateur, lays down the political line.

Left Party leader Lafontaine has also made it clear in several press interviews that he is ready to collaborate with Schröder’s SPD. Answering a question from the Frankfurter Rundschau—“Does the comeback of the Schröder supporters mean the opposition status of your party is now fixed?”—Lafontaine said it was unfortunate “that the SPD is not prepared to abandon the politics of social devastation” because “only a new left majority can change the growing social inequality in Germany.”

Questioned whether a left majority was possible with Müntefering and Steinmeier, the chairman of the Left Party answered: “One should never say never. If Müntefering and Steinmeier rethink, we are prepared to be happily surprised.”

One day after the change of SPD leadership in Willy Brandt House, the Left Party began exploratory talks with the SPD in Hesse, in order to prepare for a “left coalition” in the state legislature in the form of an SPD-Green Party coalition supported by the votes of the Left Party. These discussions do not take the form of the Left Party placing conditions on the SPD to justify lending its support, but just the reverse. The SPD is demanding the Left Party pledge its unequivocal commitment to the free-market economy and the profit system.

On the web site of the Left Party, the report about these talks bears the headline: “The Discussion was Friendly and Pleasant.” The deputy chairman of the Left Party faction in the Hesse state parliament, Janine Wissler, told the press that initial discussions were predominantly about schedules and dates. When questioned about the right-wing turn of the Green Party, Wissler answered: “We also are not immune from treading the path of adaptation.”

There can be no doubt: the rightward turn of the SPD heralds a further turn to the right by the Left Party.