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Greens OK Effort to Boost German Economy

June 15, 2003

COTTBUS, Germany (AP) _ Chancellor Gerhard Schroeder’s junior coalition partner, the Greens, gave tentative backing Saturday to his plans to trim the welfare state to try to revive Germany’s stagnant economy.

At a special party conference, 360 delegates chose a motion backing a rash of reforms proposed by Schroeder. Two rival motions were discarded. The delegates were to consider proposed amendments to the motion before voting on it Sunday.

Germany, Europe’s biggest economy, is mired in a third year of near-zero growth that has seen unemployment rise to post-reunification records. Schroeder has responded with reform pledges intended to create jobs and ease burdens on the government and employers.

Schroeder’s Social Democrats already backed the package at their own special meeting two weeks ago, and the Greens were expected to follow suit after their leaders tried to defuse criticism that the plan was too hard on poorer Germans.

Foreign Minister Joschka Fischer, the left-leaning party’s most senior politician, said painful adjustments to the welfare state now would help ensure its long-term survival. Spurring investment and economic growth was essential to provide the resources, he said.

``We’re in a very difficult situation,″ Fischer told the conference in the eastern city of Cottbus. ``If we can reduce this unemployment, social justice has a chance in this country. If we can’t do it ... there will be nothing for it but cuts and more cuts.″

Still, dissidents said the plan does too little to stimulate growth and called for a tax on the wealthy so they can shoulder more of the burden.

``Is it really courageous to start cutting with those who have the least?″ said Barbara Steffens, a party official from North Rhine-Westphalia state. ``Wouldn’t it be courageous at least to cut at the same time with those who have a lot?″

Schroeder, who has staked his political authority on the plan, argues that Germany must trim the generous pension and health care systems built up by governments of the left and right since World War II to prevent them from collapsing completely.

Business groups long have lobbied for an easing of rules that make it hard to fire workers _ a situation they say makes employers reluctant to hire in the first place. Cuts in jobless benefits and employer contributions to workers’ sick pay are supposed to ease the overall staff bill for companies.

Backing from the Greens would clear the way for Schroeder to try to guide the plan through parliament later this year. His coalition has only a four-seat majority in the lower house and lacks one in the upper house, and it remains unclear whether a handful of left-wing lawmakers opposed to his plans would defy him in a vote.

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