Downed and Out

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Wolfgang Schäuble always seemed like the perfect No. 2, his fate interlaced with that of his mentor, former German Chancellor Helmut Kohl. His ambition and loyalty to Kohl propelled him steadily higher in the ranks of the Christian Democratic Union, Germany's center-right party, even after a would-be assassin's bullet left him paralyzed in a wheelchair. When Kohl lost an election in 1998, it seemed only fitting that he handpicked Schäuble as his successor.

But with Kohl's fall from grace in the wake of an ongoing party finance scandal, Schäuble's fortunes still seemed entwined with those of Kohl: last week Schäuble announced his resignation as head of the opposition CDU's parliamentary group, and announced that he would not seek re-election as party chairman at the next CDU congress in April.

In announcing that he would step down, Schäuble told a news conference that he had "become convinced that the [CDU] cannot free itself from the clutches of this crisis without a visible fresh start, which means a fresh start from the point of view of personalities." While Schäuble was publicly saluted for making an honorable exit in the best interests of the party, it was clear that his departure was not entirely voluntary. At a late-night meeting of the party's parliamentary group, he was bluntly told by his colleagues in the CDU's parliamentary delegation that his continuation as party leader was unacceptable.

The CDU finally decided to act after a stunning $21 million fine was levied against it by parliamentary president Wolfgang Thierse. Among the many ironies in the campaign finance scandal, Thierse hails from the eastern part of Germany, which Kohl--the "Chancellor of Unity"--was instrumental in joining with western Germany in 1990. Thierse said the party should repay the money, which it received as a subsidy from the federal government, because it broke the law on campaign contributions. Party leaders immediately said they would appeal the decision, which they claimed could bankrupt the party. "The reaction of the CDU shows they just don't get it," commented Chancellor Gerhard Schroder, who is also head of the Social Democratic Party. But CDU leaders were clearly also hoping to make a fresh start to avert disaster in the state elections in Schleswig-Holstein this Sunday (see Reversal of Fortunes) and in North Rhine-Westphalia in May.

The 57-year-old Schäuble will be succeeded as CDU parliamentary leader by Friedrich Merz, a 44-year-old expert on the federal budget and tax matters. His successor as party chairman is still up for grabs, with Angela Merkel, the party's general secretary, vying with a number of state leaders for the post. Like Schäuble, though, Merkel also suffers from her former close relationship with Kohl.

Germany's most serious post-war political crisis stemmed from a confession by Kohl in November that he had operated a series of secret bank accounts used to conceal unreported--and thus illegal--contributions to the party. Kohl said he used the money to finance election campaigns by CDU officials in the newly annexed states of the former East Germany in the early 1990s. But he has refused persistent demands that he name the donors, saying his silence is a matter of personal honor.

That stubbornness has cost his party dearly, as many Germans regard Kohl's position of putting his personal word before constitutional requirements to disclose political funding as extreme arrogance--and flagrant disregard for the law. The party forced Kohl to relinquish his title as honorary chairman of the CDU, and before his own resignation Schäuble appealed repeatedly and unsuccessfully for Kohl to break his silence.

Schäuble, a former Interior Minister under Kohl, was personally drawn into the scandal in January when he belatedly admitted meeting an arms dealer, Karlheinz Schreiber, and receiving a $50,000 cash contribution from him. The money subsequently vanished without being declared. In subsequent weeks, Schäuble has found his version of events publicly contradicted both by Schreiber, who is fighting extradition to Germany from Canada, and from former party treasurer Brigitte Baumeister. The story now has so many questions surrounding it that Schäuble's credibility has been fatally undermined in the eyes of many voters.

And if that weren't bad enough, the CDU faces another crisis in the state of Hesse, where party officials have been forced to admit having squirreled away $10 million in questionable funds in Swiss bank accounts and then reimported the money without declaring it. The former party leader in Hesse, Manfred Kanther, has already resigned his seat in parliament. The current leader, Hesse premier Ronald Koch, has admitted that he lied in his account of the illegal funding but has so far refused to step down, causing further uproar. The leadership of the Free Democratic Party, the CDU's coalition partner, has begun a campaign to force Koch's resignation. If that results in new elections, it could change the political landscape in Germany, since state parliaments control the upper house of the German federal parliament.

There seemed to be relief at Schäuble's decision to step down. His departure, said the newspaper Die Welt, "is like the final act of a Shakespearean play. More and more, he became the tragic hero in the tragedy of his party." What's not clear is whether Schäuble's efforts to save the party from further scandal will have any effect. A succession struggle to fill his job as party leader now looms, a battle which could lead to even more backstabbing among party members. A parliamentary investigation of the campaign finance scandal has been launched to determine if the Kohl government granted political favors in return for the cash donations, something Kohl has vehemently denied. And Kohl himself still faces possible prosecution for his handling of the undeclared contributions. Kohl may now be in semi-retirement, but it's clear that the fate of his party is still very much in his hands.