1998-2005 - Gerhard Schröder

The Social Democrat Chancellor Gerhard Schröder / Gerhard Schroeder [not to be confused with Gerhard Schröder, the CDU minister - including Foreign Minister - in the 1950s and 1960s], whose party ruled in the Red-Green coalition with the environmental-orientated political party, Greens (die Grüne), was elected as the first Federal Chancellor in 1998. The Social Democratic Party (SPD), one of the oldest organized political parties in the world, narrowly emerged as the winner, with 38.5 percent of the vote, in the September 2002 elections. Most of the support of the SPD came from industrialized zones and big cities.

His chancellorship was defined by the NATO mission in Kosovo, the phasing out of nuclear power and the Agenda 2010 reforms. During the elections to the Bundestag in 1998 the SPD and Alliance 90/The Greens won a majority in the Bundestag. Gerhard Schröder became the leader of the new SPD/Green coalition.

In one of the better known anecdotes about Gerhard Schröder, the ambitious young politician is climbing up on the railing outside the chancellery of the then-capital Bonn -- perhaps after a drink or two nearby -- while shouting "I want to get in there!" The story, whether true or apocryphal, illustrated well the fact that Schröder made it to the very top of German politics, and indeed, into the chancellery, thanks to driving ambition and single-minded purpose. This was not a man born with a silver spoon in his mouth and groomed for greatness from early on. In fact, his childhood and upbringing were anything but auspicious.

He was born on April 7, 1944, in Mossenberg, in Lower Saxony, into war and biting poverty. His father, who he never met, was an unskilled laborer who was killed in Romania while serving in the German army. His mother, a cleaning woman, had six children to raise and little money to do it with.

Breaking out of that world was not easy. After Schröder graduated from secondary school he worked in a hardware shop and as a construction worker. Determined to make a name for himself, he later went back to night school to get his Abitur, the degree which would enable him to attend university. He enrolled at the University of Göttingen in 1966 and got his law degree in 1970. He opened a law practice in Hanover in 1976.

Influenced by the strong social democratic ideals of his mother and his idol, Social Democrat and German Chancellor Willy Brandt, Schröder began to get more involved in party politics, although he had already joined the Social Democratic Party (SPD) in 1963. In 1978, he became head of its youth organization, the Young Socialists. For a time, he embraced leftist politics and causes, making a name for himself as a defender of then left-wing terrorist Horst Mahler and taking part in anti-nuclear demonstrations.

Schröder used to be a leftie: in the 1970s he was a leader of the Jusos, the fiercely anti-American, anti-nuclear youth wing of the Social Democratic Party. But it was also during this time that Schröder began to develop a penchant for cigars and expensive suits, qualities that earned him little admiration from more left-leaning members of the SPD. But such tastes coincided with his journey from the left wing to a more centrist position within the party.

In 1980 he was elected to the German parliament and in 1986, he became head of the SPD parliamentary group in the state legislature in Lower Saxony.

During the next four years, Schröder learned how to maneuver through the halls of power, and how to package political content for easy media consumption -- skills that turned out to be essential to his later success.

In 1990, he unexpectedly defeated Ernst Albrecht, the Christian Democratic premier of Lower Saxony, who was weakened by scandal. During his two-term leadership, Schröder put such a stamp on the state that even today, he is indelibly linked with it.

Schröder conquered the chancellery in 1998 promising to end 16 years of "stagnation" under Helmut Kohl and to rule from the "New Middle," a version of the Third Way made popular by former U.S. President Bill Clinton and British Prime Minister Tony Blair. At home, the government reformed the tax system and nationality law, for instance. The phasing out of nuclear power and better promotion of renewable energies meant Schröder’s government set a new course in energy policy. The “Alliance for Work” comprising the government, employers and employees was successful in stemming the high rates of unemployment.

While he governed for a while with the environmentalist Green party, the always independent Schröder was not shy about sidling up to business interests. He had many friends among the heads of corporate Germany -- in the automotive and steel industries, shipyards, airlines and utilities. That, along with his slick media savvy and roguish charm -- not to mention the expensive cigars -- earned him the distrust of the SPD's left wing and his one-time coalition partners, the Greens. He earned a reputation as a narcissist and some SPD members derided him as "Comrade Boss."

The cash version of the euro was introduced in Europe in 2002. In addition, during Gerhard Schröder’s period in office many Eastern European countries acceded to the EU. At the same time Germany played a key role when it came to reforms to ensure an enlarged Europe remained capable of effective action.

The center-left coalition government of Chancellor Gerhard Schroeder that took office in late 1998 consolidated its position and embarked on a number of economic reforms considered necessary to sustain economic growth and job creation, consolidate public finances, and improve Germany's investment climate. The government secured parliamentary approval in July 2000 for significant new tax reforms that to be phased in over 2001-2005.

During the 1998 election, Chancellor Schroeder promised that he would reduce unemployment (then over 4 million) to 3.5 million by the end of his four-year term. Unemployment began to decline (from 10.5 percent in 1999 to 9.6 percent in 2000) due to demographic trends and job creation resulting from strong economic growth. Since the beginning of the year 2001, however, economic growth weakened and employment creation stagnated.

The domestic policy debate on the “Agenda 2010” program of reforms defined Gerhard Schröder’s second term of office. Unemployment had risen to oppressively high levels and spending on unemployment benefit and unemployment assistance was becoming unmanageable. “The courage to change” was what the Chancellor called for in this period. The Agenda 2010 reforms aimed to make the country capable of effective action once more. The German Government also called on its citizens to play their part. For example, unemployment benefit is now generally only paid for one year, the aim being that the unemployed should do more to find work themselves. At the same time those people who look for work themselves receive more support.

In the summer of 2002 severe flooding along the banks of the Elbe River caused serious damage. The German Government’s resolute crisis management mitigated the consequences for thousands of people affected.

The SPD stressed social-welfare programs and strongly supported German ties with NATO. The Greens emphasized environmental, ecological, and peace issues and maintain a strong base that is anti-NATO, anti-nuclear, and anti-military. Over the years, the inclusion of the Green party in the ruling coalition greatly influenced Germany's energy and environmental policy objectives.

Germany's energy consensus talks, ongoing since March 1993, were brought to unsuccessful end on 26 October 1993. Representatives from the Social Democratic Party (SDP), led by Lower Saxony's prime minister, Gerhard Schroeder, failed to get approval from party leaders on continued development of advanced reactors with enhanced safety - notably the Siemens/Framatome-designed 1500-MWe European pressurized water reactor (EPR) plan, for which the prospective schedule envisages a construction start in 1998. Nor would the SDP leadership accept the continued operation of existing nuclear plans to the end of their design life (some 20 to 25 years).

From phasing out nuclear power to promoting energy efficiency and renewables, Germany became a pioneer in reducing greenhouse gas emissions and in making alternative fuel sources viable. As a result, Germany has become the world's leader in wind energy, having an estimated 39% of the world's installed capacity. On 11 June 2001 German Chancellor Gerhard Schroeder and leading energy companies sign an agreement that will shut down 19 nuclear power plants in Germany. The agreement limits nuclear plants to 32 years of operation, meaning that all nuclear plants in Germany could be shut down by 2021.

At times it appeared that Schröder enjoyed focusing on global affairs instead of messy domestic problems, like welfare and labor reform. As the first German chancellor to grow up after World War II, Schröder has not been afraid to push for a more active role for Germany on the world stage. He campaigned for a permanent seat on the United Nations Security Council for Germany, something that none of his predecessors would have ever considered doing.

Shortly after taking office, Gerhard Schröder and his government were faced with having to decide whether to send German soldiers into armed conflict for the first time since the Second World War. After years of civil war on the Balkans the former Yugoslavia was falling apart. People were being persecuted, murdered and displaced in Kosovo. That was why Germany decided to take part in the NATO intervention to establish peace in Kosovo.

The United States’ military campaign in Iraq took place during Schröder’s second period in office. Gerhard Schröder openly opposed long-time ally the United States by refusing to support the invasion of Iraq, and declined to involve German troops in the campaign. However, the Bundeswehr did take part in the fight against terrorism and the reconstruction of Afghanistan.

Gerhard Schröder regarded the attacks on the World Trade Center in New York on 11 September 2011 as an attack on Germany’s liberal model of life. He was convinced that democratic countries had to stand together in the fight against international terrorism. Within a week after the attacks on September 11, Federal Chancellor Gerhard Schroeder's promise of military assistance to the United States received parliamentary approval. Legislation was enacted a month later to allow the German authorities to prohibit religious associations with a terrorist agenda. And, by the end of 2001, a reform package had been enacted that enhanced the investigative powers of law enforcement and intelligence agencies. The new legislation constituted a shift in the balance between privacy and security interests that nevertheless attempted to stay within the German constitutional framework.

National elections on September 22, 2002 returned the incumbent Social Democratic-Greens coalition to power under Chancellor Gerhard Schroeder. Gerhard Schroeder led the party to victory in 2002 on a platform strongly opposing the war in Iraq. Most observers agree that since reaching a low-point in the lead-up to the Iraq war in 2003, relations between the United States and Germany have improved. US officials and many Members of Congress view Germany as a key US ally, have welcomed German leadership in Europe, and voiced expectations for increased US-German cooperation on the international stage.

An October 2003 PRC White Paper on PRC-EU relations stated "The EU should lift its ban on arms sales to China at an early date so as to remove barriers to greater bilateral cooperation on defense industry and technologies." This White Paper was released weeks before a high-profile Summit of EU leaders in Beijing in November 2003. Then, in early December 2003, German Chancellor Gerhard Schroeder called for the embargo to be lifted during a visit to the PRC. Barely two weeks later, at an EU summit in Brussels, French President Jacques Chriac's called for the end of the embargo.

At its height in 2004, the Iraq Coalition included 21 nations from Europe, and nine from Asia and Australasia. Twelve of the 25 members of the European Union were represented, as were 16 of the 26 NATO (North Atlantic Treaty Organization) member states. The opposition of French President Jacques Chirac and German Chancellor Gerhard Schroeder to the U.S.-led liberation of Iraq was not representative of Europe as a whole.

Two years into his second term, Schröder faced near record low popularity levels and his party was losing members as he had been hit by a stubborn economic slowdown and a series of reform measures that proved unpopular with grassroots members of his own SPD. He handed over the leadership of the party to a deputy who enjoyed more support from the rank and file. The Agenda 2010 and especially the labor market policy it entailed, which had since become known by the name of “Hartz Reforms”, were highly contentious issues. As a result the SPD lost several elections to Land parliaments.

In the face of the great resistance to his policies, Gerhard Schröder ultimately brought forward the elections to the Bundestag by one year. They were held on 18 September 2005. Unlike most parliamentary legislatures, the Bundestag cannot remove the chancellor simply with a vote of no-confidence. The Basic Law allows only for a "constructive vote of no-confidence." That is, the Bundestag can remove a chancellor only when it simultaneously agrees on a successor. This stipulation was a source of controversy when ex-Chancellor Gerhard Schröder called for a vote of no-confidence to trigger an early national election in September 2005. President Köhler and the Federal Constitutional Court decided that this step was consistent with the Basic Law.

Following the elections in September 2005, the moderate-to-conservative Christian Democratic Union/Christian Social Union (CDU/CSU), headed by Chancellor Angela Merkel, and the center-left Social Democratic Party (SPD), headed by Kurt Beck, which were normally bitter rivals, joined forces in an unusual "Grand Coalition" when neither was able to form a majority with its preferred coalition partner.

Schröder was accused of many character failings. He was said by his critics to haveno deep-rooted convictions, to be devoid of vision, to be both ambitious andpersonally insecure: hence his love for the trappings of success, such as expensiveclothes and Cuban cigars, given his humble origins as the son of a widowedcleaning lady.

Germany already imported 40 percent of its gas from Russia, more than any other west European country; by 2020 this figure was expected to reach over 60 percent. The most notable of the new gas projects is the Nord Stream gas pipeline that will connect Russia and Germany. This politically divisive project was headed by Gerhard Schröder, who extended $1.2 billion credit guarantee to this pipeline just prior to stepping down as German Chancellor. Within weeks of leaving office, the same German chancellor took on the lucrative job of the head of the consortium building this pipeline.