Conservative Merkel captures 2nd term in Germany

By GEIR MOULSON and MELISSA EDDY
Associated Press Writers
September 27, 2009

BERLIN (AP) — German Chancellor Angela Merkel on Sunday won the center-right majority that eluded her four years ago – nudging Europe’s biggest economic power to the right as it claws its way out of a deep recession.

Voters sent the nation’s main left-wing party, the Social Democrats of Foreign Minister Frank-Walter Steinmeier, into opposition after 11 years as part of the government. It was the party’s worst parliamentary election result since World War II…

…Merkel and Westerwelle will now have to figure out how to deliver on pledges of tax relief – promises that Steinmeier had said were unrealistic as the government is running up huge debts to tackle the country’s economic crisis.

Both argued that tax cuts would boost the economy, ultimately leading to higher tax revenue.

Yet Merkel has called for modest middle-income tax relief, while Westerwelle – who successfully portrayed his party as a champion of the middle class and small business – has called for far deeper tax cuts, with significant reductions in both the top and bottom rates.

“That will be the Achilles’ heel of the Free Democrats and the (new) coalition as a whole, because it will not be possible to cut taxes,” predicted Heinrich Oberreuter, a political science professor at the University of Passau.

One change should be easy: Both the conservatives and the Free Democrats want to halt a plan to shut down Germany’s 17 nuclear power plants by 2021, and extend the lives of some until more renewable energy is available…

The entire article is here.

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