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The postwar era in German history came to an end last fall when chancellor-forlife Helmut Kohl was turned out of office. During his 16-year rule, the Christian Democrat had helped to gain the West’s victory in the Cold War and the reunification of his nation. When the 68-year-old, pro-American chancellor became "history," many observers worried about what would happen under his younger successor, Social Democrat Gerhard Schröder. In the early 1970s, Schröder was head of the Hanover branch of the Jungsozialisten, radical youth organization of the Social Democratic Party, notes Josef Joffe, editorial page editor of the Süddeutsche Zeitung in Munich, writing in National Interest (Summer 1999). German defense minister Rudolf Scharping also had been a leader of the radical youth group, while foreign minister Josef Fischer, the leader of the Green Party (which is the junior partner in the ruling "Red-Green" coalition), had run with street-fighting anarcho-socialists in Frankfurt.

All three men, Joffe writes, "came of political age in the heady ’60s when they imbibed pretty much the same ideological brew in the ‘anti-imperialist struggle’ against the Vietnam War: anti-capitalism, anti-Americanism, and ‘anti-anti-communism,’ plus what the French call tiers-mondisme [Third World-ism] (especially of the ‘anti-Zionist’ variety) and contempt for ‘bourgeois’ political virtues such as moderation, compromise, and pluralism."

Today, Joffe says, "the only thing remotely ‘red’ about [Schröder] is his pricey Cuban Cohiba cigars," while erstwhile rock thrower Fischer, since moving to the head of the Foreign Office, wears only gray three-piece suits. When NATO’s U.S.-led air war against Serbia began last March, the former antiwar activists, whose parties had long opposed America and NATO, sent German strike aircraft into combat for the first time since World War II.

Like Bill Clinton when he first assumed the U.S. presidency, however, Schröder on taking office hit the ground stumbling, observes freelance writer K. Michael Prince in the Washington Quarterly (Summer 1999). Germany for the last dozen years has been plagued by high unemployment, now about 10 percent, and twice that in parts of the former East Germany. Schröder, while offering few specifics, presented himself to the voters as an agent of change. But early in his administration prospective economics minister Jost Stollman, who had symbolized the candidate’s "New Center" approach during the campaign, departed. Old-fashioned socialist Oskar Lafontaine then became finance minister—only to exit less than five months later, after encountering stiff opposition from German business. These sudden shifts didn’t help the Schröder administration’s reputation for disarray.

The Red-Green government does have some accomplishments, observes Andrei S. Markovits, a political scientist at the University of Michigan, Ann Arbor, writing in Dissent (Summer 1999). The most notable is "a new citizenship law that redefines what it means to be German."

Citizenship is based no longer on blood lineage but on place of birth (provided the parents are married and at least one of them has lived in the country legally for eight years or more)—good news for many of the roughly 100,000 children born each year to foreign residents. Moreover, revisions in the naturalization law shortening the 15-year residency requirement to eight years will allow roughly half of the 7.3 million foreigners in Germany to become citizens.

Nevertheless, Markovits says, the government’s overall record is mixed, and the German Left, after being in power for a year, is experiencing "its most profound identity crisis since 1968." There has been little progress on social justice or ecology, he says, and unemployment has been reduced only slightly.

Globalization means that Germany’s unemployment problem "can only be solved if the conditions for investment become more attractive," argues Gerd Langguth, a political scientist at the University of Bonn, writing in the summer issue of the Washington Quarterly. Direct foreign investment in German companies fell from 18 billion deutsche marks in 1995 to 1.1 billion in 1996; Asian and American companies in the latter year withdrew more capital from Germany than they put into it in the form of new investments.

Germany has also been experiencing "a brain drain" of medical and scientific researchers to other countries, Langguth says. He blames this, at least in part, on the ambivalence that many Germans seem to feel toward modern technology. Much criticism is leveled in Germany "against things modern, against progress, and against technology—and it carries more weight than elsewhere in the world, thus preventing social progress here. In the fields of modern biotechnology and gene technology, almost all the key patents are held by American enterprises." Much the same is true for the computer, communication, and office machine industries. In the worldwide commercial competition for markets, Langguth notes, "many states have much lower wages and impose much lighter governmental burdens (for example, regarding environmental protection) than Germany." The average gross monthly wage in the Czech Republic, for instance, was $337 in 1997, and in Bulgaria, $94—while in Germany last January, it was $2,706.

More than half of Germany’s gross national product ($2.1 trillion in 1998) is spent by the federal government, the Länder (states), or local authorities. Because of global pressures, this massive public spending must be reduced, Langguth says.

Taking a first step in that direction after eight months of economic muddle, Schröder and new finance minister Hans Eichel in June unveiled a package of budget and tax cuts. It would slash state expenditures by $16 billion next year, freeze pensions for two years, end many subsidies, and reduce the state’s share of national income to 40 percent over the next several years.

Many of Schröder’s fellow Social Democrats deem this "New Center" move a betrayal of their party’s traditions. But political scientist Lutz Erbring told the New York Times (July 25, 1999) that, in essence, Schröder "is gambling that a majority of Germans have the common sense to see that he is right."