Germany

In September 1998, the Social Democratic Party of Germany (SPD) was able to win the most votes in a federal parliamentary election for the second time in the history of the Federal Republic. The 1998 change of government was also the fi rst time that the governing parties were completely replaced by opposition parties. After 16 years of conservative-liberal government under the leadership of Helmut Kohl, the supporters of the red-green government had high expectations. They hoped for an end of the so-called Reformstau (reform deadlock) in Germany (Egle et al. 2003a). While a number of environmental and civil rights issues were addressed with reform measures (Zohlnhöfer 2003c: 400), the social democratic government’s fi scal, labor market, and social policies largely lacked direction and consistency (Egle and Henkes 2004; Zohlnhöfer 2004). At fi rst the government pursued a traditional social democratic course, but it increasingly made decisions that can be attributed to the infl uence of integrated markets. Many critics called the “Agenda 2010,” announced in March 2003, a fundamental break with social democratic values. In the 2005 parliamentary elections, a considerable number of traditional social democratic voters switched their allegiance to the Left Party/ Party of Democratic Socialism. As a result the red-green coalition lost its majority after seven years in offi ce (cf. Table 5.1). The SPD, however, remained in power by forming a grand coalition with the Christian Democrats.