Germans Out Of Love With Merkel's Coalition Despite Upswing - WSJ.com

http://online.wsj.com/article/BT-CO-20100806-707534.html
By Andrea Thomas Of DOW JONES NEWSWIRES

BERLIN (Dow Jones)--This has been a summer of hard knocks for Angela Merkel despite Germany's economic recovery.

Senior officials from her Christian Democratic Union party have resigned influential posts. A loss in North Rhine-Westphalia regional elections last May cost Merkel her majority in the upper house of parliament. And her coalition partner--the Free Democrats, headed by a gaffe-prone Guido Westerwelle, also her vice-chancellor and foreign minister--begs to differ on everything from taxes to nuclear power.

Backtracking on Greek aid and healthcare reforms have contributed to the appearance of a government losing traction. The result has been a sequence of disastrous poll results that this week hit a new nadir.

A new poll indicates that, for the first time in eight years, the opposition Social Democratic Party and the Green Party could potentially win a general election if one were held this month.

Such polls don't necessarily reflect how people would vote in an actual election, but they underscore speculation that Merkel's government mightn't last the remaining 37 months of its term.

The poll, conducted by Infratest dimap for ARD television and published Friday, showed that more than eight out of 10 Germans are unhappy with the government and 42% want a SPD-led government while only 32% want Merkel's conservative parties to be in charge.

Merkel's coalition, which took office in October, has been in the headlines with defections of her main party allies--she lost six state governors over the last months.

Failing backing at home could weaken the Merkel government's ability to lead the reform process in the European Union, which has been looking for German leadership. Other European leaders remember Merkel's waffling on last spring's bailout package for Greece, which many German voters opposed ahead of the North Rhine-Westphalia election in May.

"There is hardly a government [in Germany] which has had such a bad start," said Eckhard Jesse, professor for political science at the Technical University in Chemnitz. "They're like a deer staring into the headlights. They didn't do anything. This has damaged them a lot."

Political analysts believe that Merkel's approval ratings at home could rise again once economic recovery becomes tangible for German households.

Goldman Sachs economist Dirk Schumacher said that the good labor-market data are being overshadowed by how the coalition partners are treating each other, causing uncertainty about the future political direction.

"Around us, jobless numbers have risen enormously, the periphery of the euro zone faces massive economic problems, adjustments which will be very demanding and compared to this, it looks relatively good in Germany," Schumacher said. "We have a big recession behind us, but this has affected people much less."

The center-right coalition fell to its lowest support ever in this survey for ARD, reaching a combined 36%, 12 percentage points below the level of votes they received in the September general elections. Support for the opposition Social Democrats hit 31% of those polled for the first time in nearly four years, tying the SPD with Merkel's party.

Together with the Greens, the SPD would secure 48% support from the 1,500 polled.

Goldman economist Schumacher added that a break-up of the government seems unlikely at present. "That being said, there can be little doubt that the coalition is not in good shape and that weak poll ratings can develop their own dynamics," he said.



-By Andrea Thomas, Dow Jones Newswires; +49 30 2888 4126; andrea.thomas@dowjones.com