secret financiers, who, he acknowledged, had anonymously provided some DM 2 million (about $1.2 million) in funding between 1993 and 1998. One major casualty of the scandal was party chief Wolfgang Schäuble, Kohl’s longtime protégé, who had taken over the CDU in 1998. On February 16 Schäuble announced his intention to give up leadership of the party as well as his position as whip of the CDU faction in the Bundestag (second house of parliament) after it came out that he had personally accepted a briefcase containing more than DM 100,000 (DM 1 equaled about $1.62 in 1993) in cash in the early 1990s from arms dealer Karlheinz Schreiber. Schäuble had earlier denied even knowing Schreiber.
A succession of revelations and rumours throughout the early months of the year kept the story bubbling in the media. Kohl steadfastly refused to name the donors of the illegal funds, asserting that his word of honour was more precious than the law. Kohl gave up his ceremonial chairmanship of the CDU but refused to yield his seat in the Bundestag, where his obduracy soon began to impede the party’s desire to put the scandal in the past and get down to the business of legislating. Awkward questions were raised as well by Kohl’s planned participation in ceremonies in October commemorating the 10th anniversary of German unification. Ultimately he chose not to attend after the issue had been debated within the party and examined minutely in the media for months on end.
The CDU’s troubles detracted attention from pressing policy issues, such as reforming the Bundeswehr (armed forces) to keep pace with post-Cold War defense requirements. This issue, together with the related political, economic, social, and foreign policy dimensions, was studied by an independent 21-member commission appointed by Schröder and headed by former president Richard von Weizsäcker. The commission’s report, released on May 23, concluded that “the Bundeswehr has no future in its current structure” because it had produced a surplus of manpower but a shortage of operational forces. The commission recommended that the size of the conscript pool be reduced and that the Bundeswehr be reduced in size over a 10-year period from a peacetime force of about 320,000 to 240,000.
Defense Minister Rudolf Scharping disagreed with some aspects of the report, including the overall target size of the force and the reduction in the number of conscripts. Proponents of universal military service argued that democracy depended on the armed forces’ representing a broad cross section of German society. In addition, they pointed out, approximately 50% of the professional military found its way into the Bundeswehr through conscription. Scharping’s proposal to maintain a peacetime armed force of 255,000 was accepted by the cabinet in June, with the Greens, who favoured abolishing conscription altogether, dissenting. At a conference of business leaders on May 4, Schröder and Scharping proposed partial privatization of the military. They stressed the importance of modern management methods and said that projected savings would be reinvested in the Bundeswehr to ensure its readiness to meet NATO responsibilities.
Another issue closely related to belt-tightening was the question of continuing subsidies for the development of eastern Germany. A report by the Ifo Institute, a prominent think tank for political and economic research, argued that unification had not yielded economic reunification of the two Germanies, even 10 years and many billions of Deutsche Marks later. Growth in the east had been stagnant since 1996. On the eve of the 10th-anniversary celebrations, in a paid advertisement in a major newspaper, the rhetoric of a 1996 speech by ex-communist politicians from the former East Germany was replayed with heavy irony: “German unity will be completed when the special judicial treatment of the east Germans ends, when wages in the east and west are the same, when there are as many east German homeowners on the island of Sylt as west Germans on the island of Rügen [popular vacation resorts], whe