Unequal Grand Coalition

All eyes were on Merkel as leaders from the European Union's 27 countries gathered in Berlin over the weekend to celebrate the EU's 50th birthday. From her first appearance on the European stage, Merkel has impressed many with her ability to forge a consensus among the bloc's leaders.

While her reputation as a no-nonsense leader has helped her internationally, her Christian Democratic Union has also scored points at home on issues that used to be the main plank of the Social Democratic Party's policies, including childcare, and at the same time forcing the SPD to agree to a corporate tax reform.

As growth approaches 3 percent and some 600,000 people have come off the unemployment rolls, many in Germany are wondering who to thank for the recent upswing which economists say is likely to continue.

SPD making Merkel look good

"The SPD is in an existential crisis," Manfred Güllner, head of the Forsa research company, told Reuters news service. "Merkel looks so strong right now in part because her coalition partners are so weak."

With his party at an all-time low, Social Democratic Party leader Kurt Beck has taken credit for the country's economic improvement, saying it is the belated effects of former Chancellor Gerhard Schröder's extensive social and labor reforms that "created the conditions to put us back in the right direction."

"There is no question about it," he told Germany's mass-market Bild newspaper. "The current economic upswing is our upswing."

But Germans say they aren't convinced. Some 69 percent of Germans said neither the current nor the previous government was behind the current economic recovery. Ten percent said they thought Mekel's government was behind the upswing and 14 percent said Schröder's policies were responsible, according to a Forsa study conducted last week for TV news channel n-tv.

The study also showed Mekel to be Germany's most well-liked politician, followed by Foreign Minister Frank-Walter Steinmeier.

US missile defense separates parties

A controversial anti-missile shield, parts of which the United States wants to station in Poland and the Czech Republic, is an issue the SPD have been trying to use to separate themselves from the CDU.

While Merkel has insisted the issue be taken up by NATO, Defense Minister Franz Josef Jung threw his support behind the US plan on Monday.

"With a foreseeable increase in the number of long-distance attack missiles we should be thinking of our national security interests," Jung told the Handelsblatt newspaper.

Beck and Steinmeier -- as well as much of the SPD -- have warned that the United States must take care not to start another arms race with Russia, which has vehemently objected to an anti-missile shield in its former sphere of influence.

Anti-Americanism not a knee-jerk reaction

Though the SPD has reaped the benefits of shifting the focus to foreign policy when in a domestic crisis, including when Schröder vocally opposed the Iraq war and won re-election as a result, SPD General Secretary Hubertus Heil said his party should be allowed to address foreign policy issues without being accused of having a second agenda.

"I think it is amazing that party tactics are always mentioned when we in the SPD take a position on foreign policy," he said in an interview with Berlin's Tagesspiegel newspaper on Sunday. "Sometimes the same commentators writing who sharply criticized our stance against the Iraq war. We proved to be correct."

Labor Minister Franz Müntefering (SPD) said he was optimistic the Social Democrats would be able make it clear to voters that the grand coalition's successes were achievements for his party.

"The point now is to make social democratic ideas part of everyday political life," he told the Bild am Sonntag over the weekend. "We are doing that with the grand coalition's policies in a number of areas. My party will profit from it at the next election in 2009 when we are back in the chancellery."