31 OCTOBER 1998, Page 13


Andrew Gimson on Oskar Lafontaine,

the only one strong enough to destroy the euro (unintentionally)

Berlin THERE IS nothing pallid about Oskar Lafontaine's appetite. The new German Finance Minister is greedy for wine, women, food and power. In an age when parliaments are filled with functionaries masquerading as democrats, Herr Lafontaine retains the grandeur of a prac- tising feudalist. He has tried it as prime minister of the Saarland and it worked. He is now going to try it in Europe, or Euroland as the area with the single cur- rency is becoming known.

He became ruler of the Saarland in 1985 and is a popular figure there, loved for his closeness to its people (there are just over a million of them) and for his impressive ability to slow the closure of the province's mines and steel plants by extorting huge subsidies from Bonn. He is the prince or princeling with the common touch, holding court in Saarbriicken, the provincial capi- tal on the French border south-east of Luxembourg. 'He goes to all their festivi- ties,' an acute observer says. 'I have seen him going into a tent dressed up as Napoleon. He has a certain self-irony. He's playing Napoleon and he is Napoleon. Not that he's a militarist. He's a Pacifist and he's anti-American. He's not left-wing. He's an etatiste. He's very influ- enced by Gaullism, but he hasn't learnt to be proud of his country and defend his country's interest.'

Herr Lafontaine was born in 1943, the son of a baker who was killed in the war. The Jesuits gave him a good education but he became a socialist. Helmut Kohl sel- dom let a day to go past without reminding People of his Catholicism, but the new German government is led by men who ignore or have reacted against Christianity. At the age of 32 Herr Lafontaine became the Mayor of Saarbriicken. In the Eighties he made a name for himself attacking the stationing of American nuclear weapons in Germany and anyone who supported that deployment, including the last Social Democrat (SPD) Chancel- lor Helmut Schmidt, of whom he said: Schmidt talks ... about a sense of duty,

reliability, practicality, steadfastness

• • . these are secondary virtues. Let us be precise: with all this you could run a con- centration camp'.

Herr Lafontaine here evinces the con- tempt for 'secondary virtues' which makes him such an alarming colleague and gives so many Germans the feeling that if Ger- hard Schroder, the new Chancellor, is one day found with a stiletto in his back, Herr Lafontaine's alibi should be treated with scepticism. Herr Schroder's prize might have gone to Herr Lafontaine, who stood as the SPD's candidate against Herr Kohl in 1990, but was annihilated after cam- paigning against German reunification, which he dismissed as 'national intoxica- tion' and warned it would cost a mint of money. So it did, but Herr Kohl won because after an initial period of confusion he got the politics of reunification right.

Things went from bad to worse for Herr Lafontaine. In 1990 he had the misfortune to be stabbed in the neck and nearly killed by a deranged woman at an election rally in Cologne. In the early Nineties it was revealed that he was wrongly receiving a pension for his years as a Mayor of Saar- briicken, a 'technical error', as he termed it, which meant he had to pay back about £90,000 (228,000 marks).

He managed to stop a broadcast by Ger- man state television about an alleged rela- tionship between himself and a high-class prostitute, but after other stories in the press about his alleged links with Saar- brticken's red-light district, and resulting legal action, a court ruled that he had failed plausibly to counter allegations that he had given tax breaks to a brothel while Mayor of Saarbriicken.

In 1995, however, Herr Lafontaine bounced back with a spectacular coup against Rudolf Scharping, the man who `That's what comes of having two celebrity chefs in the same kitchen.' lost the 1994 national election for the SPD. Herr Lafontaine got himself elected SPD Chairman in place of Mr Scharping and inflicted a degree of discipline on the party that none of his four predecessors had achieved. It came into this year's election campaign in better shape than for a long time, but realised that Herr Schroder rather than Herr Lafontaine was the man with the popular appeal to beat Herr Kohl.

A great many Germans do not trust Herr Lafontaine, a feeling intensified by his behaviour since the election. Many people had the impression that he went power mad. He drove out rivals, grabbed extra powers for the Finance Ministry, placed his stamp on the coalition agreement with the Greens, launched fierce attacks on the Bundesbank for concentrating on the fight against inflation and failing to create jobs, and seemed to see himself as the real Chancellor.

Herr Lafontaine shows an arrogance worthy of the French technocrats with whom he has so much in common. He real- ly does believe he knows better how to run an economy or a currency than private enterprise or central bankers do. Never mind about reforming the labour market: increase demand enough and the jobs will come. The idea that by cutting tax rates a government might actually increase its rev- enue does not seem to have crossed his mind. He proposes a tax reform which con- sists of cutting loopholes for the rich and for business in order to finance modest tax cuts and benefit increases for the poor. It is impressively unfashionable stuff, except perhaps in France and Italy, and he and his third wife have written a book of over 300 pages called Don't Be Afraid of Globalisa- tion — Prosperity and Work for All to explain what he means. 'It is a serious book, not a quick book. They worked for a year on it,' I am told.

If he can provide prosperity and work for all or at least more of the Germans then he will have repeated his achievement in the Saarland and the mighty prince will be rewarded by the gratitude of his subjects. But Herr Lafontaine himself seems to recognise what a tall order this is when he explains his plans for Europe. No other country in Euroland should be allowed to undercut Germany's high levels of tax and welfare and the European Central Bank must work to create jobs as well as ensure sound money. He and his colleagues will also tell it where to keep the euro against the dollar and the yen. He is so sure of himself, the thought sometimes crosses my mind that here at last we have a German with the self-confidence to destroy the euro, albeit unintentionally. And then it occurs to me that Herr Schroder does not love the new currency, and it would suit him rather well if Herr Lafontaine and the euro wiped each other out.

Andrew Gimson is the Daily Telegraph's Berlin correspondent.