Hans Eichel - Political Career

Political Career

From 1975 to 1991, he was the mayor of Kassel, initially gaining the office at the age of only 33. From 1991 to 1999, he was Premier (Ministerpräsident) of Hesse in a coalition with the Greens. The coalition won again four years later and was the first red-green coalition to serve two consecutive terms. However, he unexpectedly lost the state elections in February 1999 to Roland Koch's CDU and lost his office. However, in March Oskar Lafontaine resigned as German finance minister and Eichel replaced him a month later. Eichel also served as President of the Bundesrat from November 1998 to April 1999. He has been a member of the Bundestag since 2002, but has announced to retire in 2009.

At the beginning of his term of office, he tried to decrease the German federal deficit and wanted a balanced budget until 2006. Initially he was successful and earned the nickname Iron Hans or Iron Minister because of his ability to exercise strict budget discipline. Despite initial success, due to constraints by the cabinet and by the worsening economic situation after the short boom in 1999/2000, he had to abandon these plans. Moreover, during the 2002 election campaign when the SPD was suffering from bad opinion poll figures, it was speculated that Eichel could become Vice Chancellor under a new Chancellor Edmund Stoiber. Schröder was not happy with this and though he was kept as minister in the cabinet, Eichel had fallen from grace. After the election Eichel had to recalculate the budget due to the deteriorating economy and found that he would have $18 billion less taxes than expected. The German budget deficit soared to 3.8%, the highest of all EU members (also above the 3% limit set by the EU's Stability Pact). Eichel missed to push the deficit below 3% for the rest of his tennure until 2005.