Chancellor’s Hard Decisions Erase His Soft Image at Home

BERLIN — What a difference a war makes.

Only three months ago, Gerhard Schroeder was being maligned as the “Cashmere Chancellor,” too soft to endure the arduous labors of leading Europe’s most powerful country.

But having acquitted himself admirably as head of the European Union over the past six months, from January’s trouble-free introduction of the euro common currency to June’s political triumph in helping broker a peace agreement in Kosovo, Schroeder’s profile as an able statesman has been elevated both at home and abroad.

As the leader of the group of the world’s leading industrial powers--a role he held simultaneously with the rotating EU duties--the 55-year-old government chief finally moved out of the shadow of his powerful predecessor, Helmut Kohl, with deft direction of the diplomatic traffic between the wealthy seven nations and Russia.

Contributing significantly to the metamorphosis of Schroeder’s image from cashmere to khaki, he supervised the first combat activity of German military forces since the savage assaults waged by Adolf Hitler, transforming the profile of Germans in uniform from pariahs to defenders of peace.

“Many of my countrymen are now in the state of shock that the chancellor they elected on domestic considerations conducted himself so successfully in the midst of the toughest foreign policy challenges we’ve faced in decades,” says Martin Mantske, an analyst with the German Society for Foreign Policy here.

Like other surveyors of the political landscape, Mantske credits Schroeder’s turnaround to sage advice from his chief international affairs aide, Michael Steiner, and an unexpectedly strong synergy of the “crisis trio”--Schroeder, Foreign Minister Joschka Fischer and Defense Minister Rudolf Scharping, who all count a pacifist phase in their pasts.

Voter approval ratings for the trio soared over the three-month course of the undeclared war and are expected to rise higher when the June rankings of the monthly ZDF television poll are released.

“An unbelievable task” confronted the German chancellor over these past few months in his joint roles as EU and G-7 leader, French President Jacques Chirac observed this week as the Group of Seven nations plus Russia concluded their annual summit in Cologne. As the alliance batons are about to be passed respectively to Finland and Japan, Chirac proclaimed Schroeder’s stewardship “very, very well-done.”

Schroeder himself took a bow in Cologne, declaring himself very satisfied with the gathering that tackled a collective postwar Balkans policy, world debt relief, financial market controls and the task of mending strategic fences with Russia.

The negotiated end to the war in Kosovo also coincided with unexpected good news for the troubled German economy: The gross domestic product grew a modest 0.4% the first quarter of this year, surprising economic analysts who had unanimously predicted further shrinkage. Manufacturing orders, another key growth index, rose a robust 3.3% in April, according to figures released last week, bolstering the euro, which has slid in value since its introduction, and spurring government predictions of economic recovery by year’s end.

But Schroeder is unlikely to parlay his newly earned political capital into long-term economic reform, because he faces fierce opposition within his own coalition of Social Democrats and environmentalist Greens to budgetary belt-tightening as well as to the market deregulation he has urged, along with British Prime Minister Tony Blair, to wrest Europe from its dependence on ever-rising taxes.

What is viewed as a success for Germany this month--the end of NATO airstrikes against Yugoslavia and the moral rehabilitation of the military--could come back to haunt Schroeder on the economic front if Germany is made to bear the brunt of reconstruction costs in the Balkans.

Wolfgang Roth, the vice president of the European Investment Bank, reckons that reconstruction will cost at least 100 billion marks ($53 billion).