Accessibility links

Breaking News

Economic Problems Foster Tension In Germany

Prague, May 22 (RFE/RL) -- Busses, streetcars and subway trains stopped today for several hours in many large German cities. So did collections of refuse.

Yesterday, several million letters were left uncollected in post offices and numerous schools as well, as municipal offices were temporarily closed.

It is estimated that, during the last three days, hundreds of thousands public sector employees halted work in a series of token strikes in protest against the government's austerity plans.

The German government announced last month its intention to freeze this year salaries of more than three-million public sector employees. The government also wants to cut sick pay, and modify a system of "rest cures" that enables workers to spend four weeks every three years in a rest center, in addition to regular vacations.

The public sector labor unions called for strikes in pressing demands for 4.5 percent pay rise this year, and in opposition to the government's plans to reduce the remaining benefits.

Today, representatives of the unions and the government are meeting for talks on a new contract. Earlier sessions failed to produce agreements. This time, the unions have used the strikes to put additional pressure on government officials at federal and local levels.

Government leaders are said to be unmoved by the strikes. Chancellor Helmut Kohl was said to be "unimpressed" by the protests. Wolfgang Shaeuble, the parliamentary leader of the majority Christian Democrats, called on the unions to join in the effort to cut labor costs.

Germany has a very generous welfare system. It also has the world's highest pay levels. But its economy has recently been slipping.

During the last few years, numerous companies have gone bankrupt. Unemployment has skyrocketed. And the public debt has rapidly increased.

At the heart of the problem has been the high cost of the existing welfare system. It has been seriously strained by the massive expenditures resulting from the absorption of East Germany - its inhabitants benefit from the system, but have never contributed to it. It has also been affected by high unemployment, with millions of people drawing funds but not adding anything. The result is an economic crisis and spreading social malaise.

In Germany, industrial relations have long been rooted in a consensual rapport among the government, the labor unions and the employers. This rapport has been increasingly troubled.

The government's response has been to make a major effort at reducing the budget deficit by massive spending cuts - the plans call for cuts worth about 33,000-million dollars this fiscal year.

The public seems to recognize the problem. But the problem is that no one wants to be the one suffering the pain.

The current strikes have been staged by the public sector alone. The private sector remains unaffected. But the situation could change. And if it does, the ensuing social strife could affect government policies, increase tension between the employers and the union, and undermine the traditional social and political consensus on what is good for the country as a whole.

Last year, the French government attempted to introduce a strict policy of economic austerity. This prompted massive protests by public sector employees. The government eventually caved in, eliminating the most severe elements from its program.

Could the same happen in Germany?