Germans are getting old, Chancellor Merkel noticed

It turns out that Germans are old, active, and bereft of penny-pinching habits.  An article in today's New York Times tells of Chancellor Angela Merkel's strong effort to protect the pension plans of 20.2 million Germans--a bloc that composes right around a quarter of Germany's population.  Most of the time, the two main political parties butt heads and rabble-rouse. With elections looming in the fall, however, Merkel's administration and her counterparts in Berlin were almost unilaterally decisive in fixing pension figures. No one wants to look like the bad guy in this case.

The old law (last touched upon 22 years ago, according to the article) stipulated that pension rates varied according to the average income for working Germans. That way, Grandpa Dieter couldn't take too much of the pie. But with an important election starting to creep into voters' minds, Chancellor Merkel wanted to leave a strong first impression for her re-election bid. The political stalemate only serves the large (and probably ornery) voting group of pensioners. By simple economic reasoning, working Germans will have to incur slightly higher taxes for the foreseeable future. It's not too big a deal, but the decision bears some implications for the future.

The pension edict shows that the 20.2 million person bloc figured out how to employ its political clout. This could spell interesting things for the near future of German policy making. Suppose the car industry tanks (again) or Germany's financial markets crash (again), and inspires legislation to either increase taxes or reduce pensions to stockpile money for a bailout. Will the 20.2 million voting group speak up again? You bet. If politicians neglect or piss off the elderly, they'll get the axe. It is important to note that Germany will continue to get older, meaning more pensioners will join the voting mass. Give it some time, but I have the feeling this will be popping up again in headlines soon.

If you want to take a lookie-loo, here's the article:  http://www.nytimes.com/2009/05/07/world/europe/07pension.html?_r=1&adxnnl=1&ref=europe&adxnnlx=1241733639-BqinGbkYbA+dOZENuJHwdQ