GERMANY: The German Chancellor, Mr Gerhard Schröder, has attacked leading officials in the European Commission for pushing "neo-liberal policies that have nothing to do with modern economic policy".
Two months before he faces voters, Mr Schröder described his Social Democratic Party (SPD) as a "bulwark" against neo-liberalism and the rising far-right.
"I have noticed a strange approach among those I would like to call the professors of the Commission, or those who think they are, that exceeds even the neo-liberalism of the US," Mr Schröder told Berlin's Tagesspiegel newspaper yesterday.
Mr Romano Prodi, the Commission President, and Mr Mario Monti, the Competition Commissioner, are both former professors of economics.
Berlin has clashed with Mr Monti over his plans to end the car industry's exemption from the European single market. Mr Schröder has criticised plans for a takeover law that would make German firms takeover targets, a year after German MEPs vetoed a similar law.
Mr Monti has criticised Mr Schröder's habit of bailing out ailing companies with cash injections.
Mr Schröder stepped up his rhetoric yesterday that the Commission favoured economies based on service industries at the expense of manufacturing-based economies such as Germany.
"There are strong forces in Brussels who think it is enough to have a high level of services in Europe and to organise financial markets properly, but that it's all right to neglect industry," he said. "But industrial production remains the basis of Europe's economic welfare, on which the service and financial sectors are dependent."
He said neo-liberal Brussels officials were creating "a culture of short-term availability and total fixation on share prices".
"This is now coming to an end in America while some in Europe still want to prescribe us the wrong medicine."
Mr Schröder said the fixation on share value was undermining Europe's social character just as the rise of the far-right was undermining "Europe's constituent idea, that of enlightenment".
Two months ahead of elections, the SPD is trailing the opposition conservatives by 4 per cent in opinion polls. However Mr Schröder is determined that his party will not join the list of social democratic governments to lose power in Europe this year.
