Germany: Schröder’s all-out assault on workers and the unemployed

Schröder’s policy statement amounts to a declaration of war on the workers, the unemployed and the pensioners. He has presented a catalogue of cruelty which severely cuts back the standard of living, the social security and the rights of working people. This declaration of war against the trade unions must not go unanswered. The answer must be: the mobilisation of the whole fighting potential of the trade union movement to ward off these intended attacks! Demonstrations! Strikes!

Statement by the SAV on the Government 14th March 2003 policy statement
CWI online

Schröder’s all-out assault on workers and the unemployed

All together against social cuts and war!

"Courage for peace and courage for change" was the title Schröder gave to his policy statement. Once more he proved that parliament is a talking shop. With flowery words and buttering up the trade unions he launched his attack on them. This is no longer "just" the consistent continuation of the anti-working class policies of the Kohl government, as practiced for the last four years. This attack is of a new quality, it is an all-out attack on the hard-fought rights and social standards of working people.

The chancellor was unable to provide an explanation for the crisis the country is in. He spoke of structural causes and particularly singled out employers’ non-wage labour costs, meaning the cost of the social security systems. This has increased mainly because mass unemployment has caused a reduction of payments towards social funds. Of course, the fact that the root causes of mass unemployment lie in the striving for maximum profit for banks and companies in a capitalist economy as well as the susceptibility to crisis of the economic system, is something which Schröder cannot and doesn’t want to recognise.

Catalogue of cruelty

Schröder’s suggestions follow the demands of the bosses and bankers and affect all layers of the working and unemployed population. In recognition of this, the German Chamber of Industry and Commerce attested his "respectable courage for change".

The statutory protection against redundancy in small companies is to be softened up by no longer counting temporary or contract workers when calculating the size of a company. The rules governing which work is deemed acceptable for the unemployed are to be tightened. The "merging of social welfare benefit and unemployment benefit" is a euphemistic phrase for the de facto abolition of the unemployment benefit. The duration during which sacked workers can receive the income related unemployment allowance is to be cut. An extra private medical insurance will be necessary in future for the payment of sickness benefit. Regarding other issues, Schröder was less specific, but nonetheless made it clear what is on the agenda. The statutory medical insurance is to reviewed and the medical conditions it covers will be reduced; a new pensions formula is to be worked out by Rürup commission this year, which will probably mean an increase of the pension age and a freeze on pensions.

Already, before this statement, other attacks such as the extension of shop opening times and cutbacks of holiday and Christmas bonuses for civil servants had been announced.

The carrying out of these "Reforms" is a further step in the dismantling of the "Welfare State". The social conditions in Germany are being changed fundamentally. Particularly the abolition of the unemployment benefit and the shortening of the period of entitlement to unemployment allowance will have a huge impact in the light of growing mass unemployment.

According to the DGB (German Trade Union Federation) 204,000 unemployed people between the ages of 55 and 65 are currently receiving unemployment allowance having done so for more than 24 months. According to the government’s Federal Labour Office, cutting the period of entitlement to 18 months will lead to one third of all unemployed people losing their right to an unemployment allowance. It is not known exactly how many unemployed people will be affected by the shortening of the period of entitlement to unemployment allowance, but it is clear that many people are in danger of rapidly slipping down the social ladder. Even a senior white-collar worker, a skilled worker, investment banker or academic who becomes unemployed due to the economic crisis could end up on social welfare within a year and thereby effectively slip into poverty. A lot of these people will become unemployed while suffering the additional burden of being in debt and will therefore be faced with an existential crisis. Social degradation and poverty will affect sections of society who cannot even imagine the prospect today.

The reduction of benefits for the unemployed, the contract labour organised by the PSA and the pressure to assign people to low paid jobs also has in it sights those who are still employed. It is to become an important lever for a further expansion of the low wage sector and for a general lowering of wages. This is also the intention behind the demand made to the Trade Unions to allow more opening clauses (which let employers renegotiate wage deals during their lifespan) to undermine pay agreements. If the Unions do not act substantially in this area, the Chancellor is threatening legislation to worsen the legal situation regarding pay agreements.

The private medical insurance for sickness benefits represents the breaking of a taboo because for the first time benefits, which up until now were paid for by the statutory medical insurance, are to transferred to a compulsory private insurance. This is a gift to the large private insurance companies in order for them to increase their profits. This broken taboo will be followed by more. The next round of savings measures could target dentures and non-work related injuries. A radicalisation and polarisation of society is predestined.

The Government’s new approach

After the failure of the Alliance for Jobs (a tripartite forum involving Unions, Government and employers), this policy statement also marks a new approach on the part of the government. Without bringing the trade union leadership on board, attacks on the working class are to be forced through unilaterally and, if need be, against the opposition of the union leadership. Despite the fact that Schröder’s speech was packed full of appeals to everybody’s "sense of responsibility", he has initiated a new a tougher attitude towards the working class. He has not yet called a complete all-out frontal assault and has left the general pay agreements and the regulations governing industrial relations unchanged for the moment. In his rhetoric he deliberately attempted to portray the government as the guardian of the welfare state and even warned of the "unbridled market forces", inserting a populist criticism of management errors "which are frequently rewarded with pay-offs worth millions". He also announced a freeze on minister’s salaries, as if they would notice whether they have three percent more or less in their overflowing accounts. But these populist elements and the reluctance to tackle the autonomy (from state control) of pay agreements and industrial relations legislation head on also express a fear of the potential power of the working class. In view of the historic lows which the SPD reaches week for week in the opinion polls, currently 27 percent, Schröder does not want to risk a further deepening of the crisis inside the Social Democrats.

This allowed the CDU/CSU to ingratiate itself to the forces of capitalism by presenting demands that went even further. CDU leader Angela Merkel emphasised that she is prepared to attack the general industry-wide pay agreements and the industrial relations legislation, as regards protection from redundancy the CDU/CSU calls for statutory protection to apply only in companies with 20 or more employees.

But Schröder also threatened intervening to change the laws governing wage agreements if the unions are not prepared to agree to more flexible company-specific opening clauses.

Build a new workers party

Once more it was shown that the SPD has become a capitalist party through and through. This was confirmed by reaction of the representative of the so-called left wing of the SPD, Andrea Nahles, to the policy statement. A bit of criticism of the plans regarding redundancy protection here, some slight dissent regarding the cutbacks of unemployment benefit there. Nahles showed great enthusiasm for Schröder’s worthless threat to the employers that he may introduce a training tax if they refuse to take on trainees. A likely story! For the last four years, Schröder has not introduced a single measure to place a significant obligation on employers. They would react furiously to a training tax. Schröder’s threat only served the purpose of creating the impression that he expects a "contribution" from both workers and employers. This is not the truth and Andrea Nahles should know that. Her conclusion, "These were all decisions that point the way ahead. Some modifications need to made", amounted to a declaration of bankruptcy for a "left winger". Not a trace of resistance against these anti-working class policies.

The parliamentary debate was a sad site for the working people of Germany. Eight minutes was all the speaking time allowed to the two lonely PDS MPs. But nobody can take their opposition to social cutbacks seriously any more, since the PDS in the state Senate in Berlin is leading the way as regards cuts and dismantling of the general pay agreement for the public sector. The time has clearly come for the creation of a new workers party to consistently fight against capital’s greed for profit and for the interests of workers, the unemployed and young people. The unions must break with the SPD and set about the task of building an organisation to represent the interests of workers. Such a party must be open for all activists and organisations in the movement against capitalist globalisation and war, Attac and other social movements, the trade unions and people from the left of the SPD, the Greens and the PDS who are prepared to break with these parties. In all upcoming struggles, the idea of a new party must be brought up and spread around. And the task for the moment is the organisation of these struggles.

Unions must mobilise

If the trade union leadership were to honestly represent the interests of its members, it would have to immediately launch a campaign against the government’s plans. They would have to call meetings in workplaces everywhere and trade union conferences to mobilise their membership and to organise colleagues previously not organised and prepare industrial action. Unfortunately, the reaction of the union leaders makes it seem unlikely that they will go on the offensive against Schröder.

The DGB chairman Sommer described Schröder’s plans as "unfairly balanced". Transnet (railway union) leader Hansen told a meeting of thousands of railway workers in Berlin that he didn’t want to comment in detail on Schröder’s speech, but some changes needed to be made to it. At least the Verdi (public sector, transport, finance, media and shop union) leader Bsirske used stronger language and said: "after 16 years of redistribution from bottom to top we are now being told that that wasn’t enough redistribution."

But none of the union statements contains principled opposition to cutbacks or a call for protest and resistance. The high earners in the leading positions of the trade unions will not organise resistance on their own initiative. Their attitude seems to be that everyone must tighten their belt and thereby together escape from the crisis. They merely criticise the fact that it is only hitting the workers. To mobilise resistance to Schröder’s plans, the union leadership must be forced into action by their members. That’s why pressure from below needs to be organised now – demands must be made on all levels calling for all the fighting potential of the unions be used to counter Schröder’s attacks. The mood in the factories and offices is one of dissatisfaction and anger. Speaking in interviews at the Verdi state delegate conference for North Rhine Westphalia, trade unionists said that they would not vote for Schröder again and that the unions must break with the policies of the SPD. The dissatisfaction and anger must be transformed into resistance.

The trade union leadership will probably not be able to pacify their membership. How could they? By telling them to wait for the next election? In the same way that Verdi was last week forced into organising the first (unfortunately too late) demonstration against the extension of shop opening hours, mobilisations against Schröder’s attacks will come. It is important that these are not used by the union leadership to "let off steam". Sommer, Zwickel and Bsirske may come to the conclusion that they shouldn’t endanger Schröder’s position because Merkel and Stoiber would only make things worse and therefore a course of confrontation must be avoided. Herein lies the special role of the left in the trade unions. They must mobilise for a decisive strategy for struggle in the unions in the workplaces, and, together with Attac, organisations of the unemployed and other social movements, exert pressure on the trade union leadership and initiate action from below. A large nationwide demonstration as a first step and the immediate beginning of preparations for a one-day general strike should be at the centre of such a strategy.

Schröder and the war

Schröder hoped that he could force through his social cruelty in the slipstream of the Iraq crisis and that there would therefore be little resistance, since the government opposes the war. That’s why he dealt with these two issues in his policy statement. Not one word did he devote to his government’s practical support for this war: allowing the US army the use of German airspace, the guarding of US bases by German soldiers, German soldiers in AWACS reconnaissance aircraft, the continued stationing of German soldiers in Kuwait, the supplying of Patriot missiles to Turkey.

The government is not pursuing a policy of peace. Their argument with the Bush administration is not about war and peace, it is about power and influence. The participation in wars of aggression against Serbia and Afghanistan, the restructuring of the German army into an intervention army and the continuing increased proliferation of arms are examples of the imperialist character of the policies of Schröder and Fischer. Resistance is needed – against the war and against the policies of the Red-Green government. The unions must link the struggle against the new package of social cutbacks with the struggle against the war and against German help for Bush’s war. War and arms proliferation on the one side and social cuts on the other are two sides of the same coin – signs of increasing competition and the crisis of world capitalism. Rolf Becker, a member of the local executive committee of the Verdi media branch in Hamburg, made exactly this point in his speech to the mass demonstration against the war on 15 February: "those in power always wage war on two fronts: not only in Iraq, but also internally, in the form of social cuts and job cuts, cutbacks in the health service, pensions and so on. We must resist on both fronts – for social security, for jobs and for peace!"

The organisation of the next nationwide mass demonstration, this time against war and social cutbacks, should be the next task for the trade unions. Even if such a demonstration turned out to be smaller than the anti-war demonstration on 15 February, it would still be an important step. However, if the unions were to throw their whole weight behind this campaign, it would doubtless be possible to mobilise a million workers, unemployed and young people or possibly even a lot more. This would be a starting point from which to carry out a one-day general strike, the preparations for which must begin immediately. These demands must be brought in and voted on at trade union meetings and bodies on all levels.

Against capitalism

A solution to the crisis is impossible with a government that represents the interests of capital and practices capitalist policies. They will never be prepared to take the immediate measures necessary to reduce mass unemployment and to prevent a further drop in the standard of living. Schröder’s investment plans are no more than a drop in the ocean and can at best only delay the complete bankruptcy of many local authorities. In many cases rising expenditure on social welfare and the virtual boycott of corporate taxes by many companies have brought them to the brink of ruin. But local authorities needed more expenditure and not more debts. Giving them fresh loans now will only increase the need to save in the future, which will occur at the latest when the time for repayment comes.

Instead, what’s needed is:

  • All cuts by Kohl and Schröder to be reversed.
  • Jobs and education instead of armament and war: a massive programme of public investment in the social, environmental, health, transport and education sectors.
  • Redistribution from top to bottom- drastic taxation of profits and accumulated wealth to finance investments and social expenditure.
  • On the basis of this, and a significant raising of the corporate tax rate, local authorities could be equipped with sufficient financial resources.
  • Stop all interest repayments to the banks by the federal and state governments and by local authorities.
  • Introduction of a 30 hour week with full compensation of pay and staffing levels as a first step to further reductions of working hours.
  • All companies planning redundancies to be taken into public ownership; democratic control and running of these places of work by the employees.
  • It is the crisis of the capitalist economic system which is being loaded onto the backs off the mass of the population. The problem has to be tackled at the source, if a future free of war, poverty and unemployment is to be achieved. Therefore:
  • Transfer of the 200 largest companies into public ownership under democratic control
  • Democratic planning instead of capitalist market chaos – socialist democracy instead of capitalist dictatorship of profit!

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