From the TUC

German TUC: dealing with a multi-party world

16 May 2010, by in International, Politics

The DGB is the German TUC, and I’m at its four-yearly Congress. In the opening speech, President Michael Sommer has asked the Chancellor of Germany, Christian Democrat Angela Merkel, how she intends to deal with the damage inflicted on the real economy by hedge funds and the rest of the financial sector, including by imposing a Financial Transactions Tax.

Of course, trade union leaders always throw down such rhetorical challenges to political leaders at their conferences. But at the DGB Congress, it’s not a rhetorical flourish – the Chancellor is the next speaker and will have to respond. The DGB certainly handles relationships with political parties rather differently from the TUC.

Having the leader of a Christian Democrat-led Government to speak at Congress isn’t the only difference. The DGB’s five member Executive Board has three members of the SPD (the Social Democrats, Labour’s sister party), one Christian Democrat (the Vice President) and a Green. Indeed, the leader of ver.di, Germany’s second biggest trade union, is a Green party member.

On Tuesday, the DGB Congress will hear from a panel of all the parties in the German Parliament, CDU, SPD, Greens and also the ultra-liberal FDP and the Left Party.

Yet no one doubts the DGB’s pretty tribal support for the Social Democrats. The opening video was an anti-Nazi tirade and Michael Sommer called for a ban on the neo-Nazi NPD. The Congress hall is decorated in red.

So what did Chancellor Merkel say? She didn’t duck the questions Michael Sommer asked – indeed perhaps one of the key advantages of the DGB’s approach was to force her to focus totally on the economy. And she engaged with the audience – it wasn’t a rhetorical speech, but a conversation.

She set out what her Government was doing on bank bonuses and EU regulation, including hedge funds – noting that she would need to outvote the United Kingdom on the issue!

She stressed the need for difficult discussions at the global level – including the Canadian G20 – but praised the role of the trade unions in that process (and specifically Michael Sommer who is about to take on the Presidency of the International Trade Union Confederation). She endorsed the bank levy proposal of the IMF, which Sommer had said was “no alternative” to a Financial Transactions Tax.

On the FTT, she claimed that her support for the issue at the G20 had pushed the IMF to advocate the FSC and FAT, but that the IMF were worried about the impact on business generally. She avowed support for an FTT but said she would vote for what she could get. If campaigners like unions could secure support from other world leaders, she wouldn’t stand in their way.

On Greece and the problems faced by the euro, she said that economic restructuring was vital – such as longer working lives, cutting budget deficits and government borrowing. She welcomed the role that employer and union co-determination had enabled Germany to survive the recession, and acknowledged the potential risk to fairness of the measures she advocated – making clear that daycare programmes and education would be defended.

To combat youth unemployment, she announced a guarantee of a job or a training place within 6 weeks for anyone under 25. Finally, she disagreed with the proposal for a statutory minimum wage, but urged a stronger role for collective bargaining, especially in the services sector. She committed herself, in the difficult times ahead, to deeper discussions with the unions.

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