Election is vote on euro, says Merkel

Chancellor Angela Merkel says that Germany’s election in four days will be a referendum on the euro’s future stability, as she appealed to voters to reward her handling of the debt crisis with a third term.

Merkel, speaking at a rally of her Christian Democratic Union party in the eastern city of Magdeburg, cast the national vote on Sept 22 as a decision between her policy of conditional bailouts for weaker euro countries and what she portrayed as plans by Germany’s opposition to pool the currency bloc’s debt.

“As we stabilise the euro — and that’s one thing you are deciding about on Sunday — there are different approaches,” Merkel told the crowd of several thousand, some of whom held aloft orange “Angie” signs. “We offer aid when we get something in return.”

The Social Democrats led by Peer Steinbrueck and the Greens, which aim to unseat Merkel and form a coalition, advocate a joint debt repayment fund and other options that would “throw all of the debt into one pot,” she said. “That is why your decision is also about Europe’s future path.”

Merkel, in power since 2005, is campaigning on her economic stewardship and her insistence on reforms in exchange for aid during the debt crisis that began in Greece in 2009 and spread to Ireland, Portugal, Spain and Cyprus. Her message of a safe hand on the tiller was bolstered yesterday as German investor confidence climbed to the highest level in more than three years after the benchmark DAX index rose to a record.

Steinbrueck says her austerity push has divided Europe and advocates more emphasis on growth. At home, she has neglected Europe’s biggest economy, showing “guidelines but no direction,” he said at a separate rally in Wuppertal.

“The gap between rich and poor has clearly grown in Germany,” Steinbrueck said, defending SPD plans to raise the top rate of income tax to 49% from 42% and to impose a “wealth tax.”

Latest polls suggest the race is too close to call. Support for Merkel’s Christian Democratic bloc held at 39% in a weekly Forsa poll for Stern magazine published today, while her Free Democratic coalition partner lost a percentage point to 5%, the threshold to win parliamentary seats.

Steinbrueck’s SPD was unchanged at 25%, and the Greens held at 9%. The anti-capitalist Left had 10%, also unchanged.

That leaves neither main bloc with a majority, according to Stern.

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