German Strikers Seek Better Deal
The German government is back at the negotiating table with public-sector unions, with a slow economy as a backdrop to the wage dispute
BONN — CHANCELLOR Helmut Kohl faced pressure from all sides this week. German trade unions turned on the heat just as the finance minister tried to put a lid on spending to overcome the country's worst economic crisis in years.
Mr. Kohl's position was further complicated by bitter squabbling in his government coalition.
Escalating action in the 11-day-old strike by public-sector unions brought the government back to the negotiating table Wednesday night. But bargaining proved tough. The government has fought hard to keep a wage increase below 5 percent. The parties to the talks eventually moved toward a compromise that would limit increases for top earners and give more to others.
The negotiations broke down March 20. The government took an unusual step of rejecting on April 1 a mediator's compromise proposal of a 5.4 percent wage increase for the 2.3 million public-sector workers.
The strike has caused serious disruptions to air traffic, public transport, mail distribution, and garbage collection.
The stakes in the strike are higher than the percentage figures indicate. The bitterness reflects fears that the prosperity western Germans have grown accustomed to is at risk. Cost of reunification
Kohl holds that western Germans have to start getting used to a more modest lifestyle. He has told them there is a price to pay for reunification with the formerly communist eastern states. The calls for solidarity with eastern Germany meet with little enthusiasm, now that the jubilation which marked the reunification has died down.
In an interview with the eastern German Leipziger Zeitung daily this week, President Richard von Weizsaecker complained that there were "far foo many people in the west [of Germany] who carry on blithely and do not realize what the unification process implies and what legitimate demands it makes on them."
Chancellor Kohl has warned on several occasions that Germany could not afford to become "a vacation republic" and pointed out that German workers were among the world's best-paid, with the longest vacations: six weeks a year. Economic tide turns
Western Germany's postwar success was largely rooted in close cooperation between labor and industry. The strong economy enabled employers to keep pay rises high. But economists are now warning that a failure to keep pay increases at "reasonable" levels would plunge the country into a price spiral, which in turn would cost jobs. Eastern Germany's already ailing economy would be the hardest hit.
There was little support for the strike in eastern Germany, where workers get 60 percent of their western counterparts' pay and unemployment has soared to 15 percent, compared to just over 5 percent in western Germany.
Some economists predict it will take eastern Germany at least 20 years to catch up with the west. The government is more optimistic. But Kohl has admitted he initially widely underestimated the massive amounts needed to rehabilitate eastern Germany's economy after four decades of communist central command and industrial mismanagement.
This week, Finance Minister Theo Waigel unveiled an austerity plan that should help provide the $100 billion the state will pump into eastern Germany this year.
The plan, which Mr. Waigel described as "hard-as-nails," gave Germans a first hint of the kind of sacrifices they are facing. Waigel said he intended to halve the federal deficit to 25 billion marks ($15 billion) over the next few years and will only allow government spending to grow by 2.5 percent a year.
The plan has come under attack from the opposition Social Democratic Party, which claimed it would severely affect welfare services.
Kohl has a rare 18-month election-free period ahead of him to implement the plan, which is certain to prove unpopular. The strain of the exercise is already evident and a deepening rift is showing in the chancellor's center-right coalition.