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Cablegate: Spd's New Direction to Face Test in Hesse Election

VZCZCXRO6439
RR RUEHAG RUEHDF RUEHLZ
DE RUEHFT #4823/01 3061153
ZNR UUUUU ZZH
R 021153Z NOV 07
FM AMCONSUL FRANKFURT
TO RUEHC/SECSTATE WASHDC 3843
INFO RUCNFRG/FRG COLLECTIVE

UNCLAS SECTION 01 OF 02 FRANKFURT 004823

SIPDIS

DEPARTMENT FOR EUR/AGS

SIPDIS

E.O. 12958: N/A
TAGS: PGOV PREL GM
SUBJECT: SPD's New Direction to Face Test in Hesse Election

REF.: Berlin 1977; Berlin 2004

Sensitive but unclassified; not for internet distribution.

1. At the October 26-28 Social Democratic Party (SPD) national
convention, the party's decision to adopt a platform advocating
greater "social justice" bolstered the prestige of the Hesse SPD.
Facing a state election in January 2008, Hesse SPD candidate Andrea
Ypsilanti gained influence and esteem during the convention as the
national party's agenda moved closer to her own. The Hesse election
will test not only Ypsilanti's popularity with the electorate, but
also the popularity of the SPD's new platform in an important German
state. END SUMMARY.

National Party Follows Hesse to the Left
----------------------------------------

2. The SPD national convention in Hamburg saw several grassroots
initiatives push the party agenda slightly to the left, more in line
with the direction advocated by Hesse Party Chairperson and Minister
President candidate Andrea Ypsilanti. The proposal to put technical
restrictions on the building of coal-fired power plants began as an
initiative of the Hesse SPD. The Hesse SPD leadership has also long
advocated the creation of people's shares (Volksaktien) in the
Deutsche Bahn ownership structure as a way of warding off foreign
buyers, an idea that carried the day at the convention over the
national party leadership's wishes.

3. In another clear victory for the Hesse SPD, Ypsilanti received
444 votes for the national party board, second only to party
chairperson Kurt Beck and ahead of Foreign Minister Frank-Walter
Steinmeier. The result bolsters Ypsilanti, a relative unknown
outside Hesse and the SPD, in an election year and affirms the
national party's support for her politics. The Party Whip of the
Hesse SPD, Norbert Schmitt, told Pol Specialist that the
"consistent, critical but constructive approach of the Hesse SPD and
its many initiatives in recent years have been acknowledged and
rewarded. The Hesse SPD feels that its course has been confirmed by
the national convention."

Ypsilanti - From Outlaw to Emblem
---------------------------------

4. Ypsilanti has long been identified with the SPD's left-wing and
is well known for her opposition to the Agenda 2010 economic reforms
pushed through by former SPD Chancellor Gerhard Schroeder. At the
time, she criticized the Agenda 2010 and Harz IV reforms as
economically unjust, prompting Schroeder's famous remark: "I will
not let the Ypsilantis of this party dictate my politics." Under
Beck, the SPD appears to have chosen to move in the direction of
Ypsilanti's original politics instead of reaffirming Schroeder's
reforms and taking credit for the subsequent economic upswing.
Ypsilanti's selection as Hesse SPD chairperson in December, 2006
signaled the Hesse SPD's shift to the left, in opposition to the
more centrist course advocated by her party rival, Juergen Walter.
Her selection, unpopular among SPD voters in Hesse at the time,
presaged the current divisions within the national party over the
Schroeder reforms.

A House Divided
---------------

6. The Hesse SPD remains divided going into the 2008 state
election. With current polls showing the SPD at 30% and the CDU at
43%, the centrists of the Hesse SPD argue that the party needs to
take credit for the current economic upswing by trumpeting its role
in the Schroeder reforms. Walter, an unwavering supporter of Agenda
2010, told Poloff that "this is no way to win an election," arguing
that the party should be reaching to the center to appeal to a wider
electorate. Walter pointed to the party's 20% poll numbers in
Frankfurt calling them "a disaster." For Walter, the change in
direction may have bolstered Ypsilanti in the party, but it only
forces the party to compete with the Left Party for left-leaning
voters, rather than reaching for the larger amount of voters in the
center.

7. COMMENT (SBU): Two short years have brought the rise of
Ypsilanti from a maverick under Schroeder to an influential leftist
voice in the SPD. Before the SPD's national convention in Hamburg,
party members often called the Hesse SPD "the last village in Gaul
to resist Roman rule." The question now becomes whether Ypsilanti
can translate her popularity in the party to electoral success among
an electorate which has approved of the government's economic reform
programs in the past. Ypsilanti runs the risk of failing to appeal
to both the moderate center and more left-wing voters. Voters will
decide on January 27 whether Ypsilanti's call for social justice in
a time of economic growth resonates outside the party. The national
SPD will pay close attention as its new direction is put to its
first test in Hesse. END COMMENT.

8. This cable has been coordinated with Embassy Berlin.

FRANKFURT 00004823 002 OF 002

POWELL

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