Friday, September 07, 2012

Merkel braves Bavaria beer tent to pitch euro message

By Alexandra Hudson

ABENSBERG, Germany (Reuters) - With three hours of drinking behind them when Angela Merkel entered the sweltering beer tent, the 3,000 Bavarians crammed around long wooden tables gave the German chancellor a warm and rowdy welcome.

German Chancellor Angela Merkel gestures during a joint news conference with Spain's Prime Minister Mariano Rajoy (not seen) at Moncloa Palace in Madrid, September 6, 2012. REUTERS/Andrea Comas

After taking the politician's obligatory swig, Merkel launched into her address, extolling traditional values close to Bavarian hearts and praising the predominantly Catholic state's exemplary "laptop and lederhosen" economy.

Yet despite the cheers and festive atmosphere, the annual Gillamoos folk festival north of Munich is alien territory for Merkel, a protestant who grew up in the former communist East, and Bavarians have become a nagging thorn in her side.

The Christian Social Union (CSU), Bavarian sister party to her Christian Democrats (CDU), has been ratcheting up its rhetoric on the euro zone crisis ahead of a state election next year and making life more difficult for the chancellor.

While she is trying to convince Germans to accept "more Europe", leading CSU officials are sending a very different message.

Some have suggested they want Greece ejected from the euro zone. Party general secretary Alexander Dobrindt, who escorted Merkel into the tent, has said he expects the Greeks to leave by 2013.

The CSU's tough line threatens to deepen public opposition to further rescue measures and embolden euro sceptics in her own party, exposing Merkel's centre-right coalition as fractured and unruly at a time when unity and clear messages to financial markets are desperately needed.

"We should of course show solidarity. But I also think that many people's patience is wearing thin over Greece," said Christian Schweiger, a 36-year-old tax advisor, as he emerged from the tent. "'What is the price of this solidarity?', many are thinking."

GREEK THREAT

The central Bavarian region exudes stability and affluence. Hops grow in the fields, village road signs announce the time of Catholic mass, gleaming German cars stand in the driveways, and many have covered their roofs and garages with solar panels, to take advantage of once-generous subsidies.

But it was not always so. After World War Two Bavaria's cities and its agricultural industry lay in ruins, and millions of Germans expelled from former German lands to the east poured into the state.

Finding itself in the American sector of a divided Germany, Bavaria received development aid and quickly picked itself up, becoming a centre for manufacturing, research and development.

Bavarians consider themselves committed Europeans and readily admit they owe much of their success to trade with European partners. But the state, which is fiercely proud of its balanced budget, views profligacy, whether in Greece or fellow German states, as deeply reprehensible.

In introducing the chancellor, local CSU politician Martin Neumeyer urges her not to let France's new Socialist president Francois Hollande dilute her austerity message.

"Greece is the locals' number one fear," he says later. "We are nestled between the Audi and BMW car plants here, and people feel pretty secure about the local economy. We are doing well, but people are also nervous about the threat of inflation and the euro losing value."

Merkel has criticised statements by CSU leaders and insisted she wants Greece to remain in the euro zone.

The differences in tone have been so pronounced that the first thing she does when taking her place on the stage, near the brass band, is try to reassure her audience, decked out in lederhosen and dirndl dresses and munching on pretzels and sausage, that both parties think the same.

"We are two parties. We are good sisters. Sometimes we have differences of opinion, but we are always on the same path, and when it really counts, we hold together," she tells the audience.

Merkel's pledge not to allow the European Union to become a "union of debt" draws enthusiastic applause. Her appeal to show solidarity and remember Germany's own tough times, markedly less.

LOCAL POLITICS

Privately grass-roots CSU members admit the more aggressive statements on Greece are in part designed to attract votes in the state election.

Once the monopoly party, as synonymous with Bavaria as brass bands and beer, the CSU has seen its support slide. In 2008 for the first time in more than 40 years it found itself having to enter a coalition with the liberal Free Democrats.

Merkel needs the CSU to do well. Together they form a Conservative block in the national parliament, and have joined forces in every legislature since 1949. The CSU's 44 Bundestag seats are crucial to the ruling coalition's majority, which is dominated by the CDU's 193.

As sister parties they represent the same political turf, but needn't always speak with the same voice. Sometimes the CSU can afford to say what the CDU daren't.

"The CSU is very nervous about next year's election, much more so than the CDU. They worry about holding power in Bavaria, and that is why they are spreading messages they don't stand behind," said Hubert Aiwanger, leader of the Free Voters party.

His party won 10 percent of the vote in Bavaria in 2008 and is targeting 15 percent in 2013.

It will also mount a national campaign for the federal election. Aiwanger opposes bank bail-outs and would like to see Greece and other countries reintroduce national currencies if they cannot meet euro zone rules. This has put added pressure on the CSU to take a hard line.

Still, with the exception of high-profile euro sceptic rebels such as Peter Gauweiler, the CSU has supported Merkel's euro policy in parliamentary votes in Berlin.

Dobrindt, mingling with the revellers, says the CSU and CDU have a common position, but insists the alternatives for Greece must be voiced.

"I've made clear that I hope Greece is successful, but we have to think about and name the options if they are not."

News

Friday, September 07, 2012

Merkel braves Bavaria beer tent to pitch euro message

By Alexandra Hudson