Country Listing

Germany Table of Contents


The Chancellor

The way the chancellor and his office, the Chancellory, deal with the economy depends very much on the incumbent's interests and personal style. For example, under Helmut Schmidt (1974-82), who was very interested in economic matters, the Chancellory shaped, directed, and coordinated the economic policy of the entire government economic apparatus. It also kept close contact with the business and financial community, including the Bundesbank, and became deeply involved in long-range planning. Helmut Kohl (1982- ), however, has operated very differently, using the Chancellory for limited day-to-day coordination but not attempting to use it to manage the economic policy of the government. He has used the political, not the bureaucratic, structure to make policy, working through the CDU/CSU and the FDP or through personal contacts. Although Kohl was definitely in charge of die Wende and other government policies, he has not usually presented himself as either the originator or the executor of economic and financial policy. He has chosen to control events from behind the scenes, reducing the government's visibility as well as its role.

The Minister of Finance and the Minister for Economy

In the cabinet, roles are more fixed, although they might change in accordance with personalities and political parties. The primus inter pares over the last several decades has been the minister of finance. He is responsible for the federal budget, which has become ever more important as the government's share of national income has grown and as governments increasingly use the budget to set priorities and guide national economic activity. The minister of finance also accompanies the chancellor to the annual financial summits and is the main German spokesperson in the meetings of the Group of Seven (G-7--see Glossary), the world's principal economic powers. He is thus in a position to manage not only domestic but also international financial policy for Germany and to coordinate the two.

The minister for economics, once the government's chief economic policy maker (especially when the minister was Ludwig Erhard), has gradually lost power as many of the important functions have been transferred to other ministries--including new ministries concerned with environment and research. Since the 1970s, the minister for economics has functioned more like a United States secretary of commerce, remaining a principal channel for contact with industry, labor, and semipublic associations. But several of the ministers have complained in bitter frustration that they were not able to carry out the policies they wanted.

Data as of August 1995