German government party stays on course on euro

[December 17, 2011]  BERLIN (AP) -- Rebels in Germany's junior governing party on Friday failed to turn it against eurozone efforts to set up a permanent rescue fund, an outcome that averts a possible political crisis for Chancellor Angela Merkel.

Dissenters in the struggling pro-market Free Democratic Party had forced the ballot on whether lawmakers in the party should support the euro500 billion ($650 billion) European Stability Mechanism, which is due to take start work next year.

However, the party's embattled leader, Vice Chancellor Philipp Roesler, said that their motion was defeated by 10,841 votes to 8,809. There were 280 abstentions in the ballot, conducted by mail over recent weeks.

"The FDP is, and remains, a party with a clear pro-European direction, with the necessary economic policy good sense," said Roesler, who is also Germany's economy minister.

Leaders of the party have talked tough on Europe's debt crisis but support the rescue fund, a cornerstone of efforts led by Merkel to get the situation under control.

Health Minister Daniel Bahr, an FDP member, questioned earlier this month whether the governing coalition could continue to work if party members voted against the fund. No date has yet been set for a parliamentary vote on it.

Had the ballot gone the other way, rebels would have needed a third of party members, which number 65,000 in all, to participate for the result to be valid. But they also missed that target.

The rebels' failure gives Roesler, 38, a respite after a difficult week in which speculation swirled that his days as party leader were numbered.

Roesler took over only in May, promising that the FDP would "deliver," but he has failed to lift the party out of a poll slump.

Roesler annoyed dissenters by declaring on Sunday, two days before voting ended, that they had failed because it appeared too few votes had been cast in the ballot. A complicated voting system also attracted criticism.

One of the FDP's top officials, general secretary Christian Lindner, quit unexpectedly on Wednesday, saying that he wanted to "make possible a new dynamic."

The FDP joined Merkel's conservatives in government in 2009, winning nearly 15 percent of the vote after an election campaign focused heavily on income tax cuts -- a pledge that has been ground down to almost nothing.

The party has attracted much of the blame for frequent infighting in the coalition and has been punished by voters in state elections this year. Nationally, it regularly polls below the 5 percent needed to win seats in parliament.

[Associated Press; By GEIR MOULSON]

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