But an upsurge in extreme right activity, centered in Dresden and the surrounding state of Saxony, may not be so easy to quell. The National Democratic Party of Germany (NDP) has found a potent new issue that it has already used to win 12 seats in the 124-seat state parliament -- the labor reforms of Chancellor Gerhard Schröder's center-left government. The reforms, which took effect in January, cut benefits for many unemployed people, who make up 19.6% of the workforce in Saxony and a record 5 million people, or 12.1%, nationwide.
A new generation of media-savvy far-right leaders, eschewing the skinhead look in favor of suits, is using Schröder's reforms to score points with voters in the western state of Schleswig-Holstein, which holds elections on Feb. 20. The NDP portrays itself as the party that will revoke the reforms and restore full employment. "Racial slogans are in the background, social issues are in the forefront. That is a more sophisticated and very dangerous strategy," says Hauke Hartmann, an expert on extremism at the Bertelsmann Foundation, a Gütersloh think tank.
Other far-right parties, such as the German People's Union and the Republicans, have put aside their differences to work together. If the NDP gets more than 5% of the Schleswig-Holstein vote, the threshold for winning seats, it would be a step closer to its goal of representation in the national Parliament. "If we succeed in campaigning as a single force, then we will succeed in becoming a nationalist voice just like other nationalist parties have done in France, Belgium, Italy, and other countries," says Johannes Müller, a physician turned politician who is a member of the NDP's delegation to Saxony's legislature.INFIGHTING
So far neither Schröder's Social Democrats nor the Christian Democrats has found a coherent strategy to deal with the far right. On the contrary, the rise of the NDP -- dramatized by demonstrations on the Feb. 13 anniversary of the allied fire-bombing of Dresden -- has inflamed a power struggle within the center right. Bavarian Prime Minister Edmund Stoiber accused Schröder on Feb. 9 of creating fertile ground for extremists by failing to cut unemployment. But critics say Stoiber, who boasts of his success marginalizing the far right in Bavaria, is using the issue to displace rival Angela Merkel, chairman of the Christian Democrats, as center-right candidate for Chancellor.
Experts in extremism say party infighting plays into the hands of the right wingers. Instead, the mainstream parties need to better explain how reform will lead to faster growth. "The best protection against right-wing radicalism is a healthy economy," says Matthias Jung, director of Mannheim-based pollster Elections Research Group.
Meanwhile, right-wing groups are softening their image further by offering social programs for young people. "They try to dismiss us as a fringe group. We come from the center of society," declares Matthias Paul, a clean-cut 27-year-old in the NDP's Saxony delegation. The NDP has also established ties with similar parties throughout Europe. They will not be able to seize power. But they are sowing confusion amid the forces of democracy. By Jack Ewing in Frankfurt, with William Boston in Dresden