Rival hammers Merkel at biggest campaign rally to date

German Chancellor Angela Merkel's struggling rival in next month's general election attempted to revive his campaign at the weekend by attacking her euro policy at his biggest rally to date.

Peer Steinbrueck, candidate for the main opposition Social Democrats (SPD), said Merkel was hurting both Germans and the citizens of the ailing eurozone countries with an unwavering focus on enforcing budgetary rigour rather than spurring growth.

"Cuts, cuts, only cuts -- that is not going to get the (eurozone) countries out of trouble," said Steinbrueck, who served as finance minister under Merkel during her first 2005-2009 term in a left-right "grand coalition."

Blasting a yawning wealth gap in Europe's top economy, he also called for an across-the-board minimum wage in Germany, which has done without one until now.

"It's not only fairer but also makes sense economically because it creates spending power," Steinbrueck said, in a full-throated, 40-minute speech that was frequently interrupted by applause.

"Freedom, justice, solidarity -- those are the values I want to promote as chancellor."

Steinbrueck, 66, was speaking at a celebration of the SPD's 150th birthday at Berlin's Brandenburg Gate running throughout the weekend, where the party said up to 300,000 people had gathered on Saturday alone.

But he is the clear underdog in the September 22 vote, as a new poll on Sunday showed.

Merkel's conservative Christian Democrats have 40-percent support, according to the survey for Bild am Sonntag newspaper, while the SPD scored just 24 percent -- one point above its record-low result in the 2009 election.

Merkel's pro-business coalition partners, the Free Democrats, tallied six percent, potentially giving the allies another ruling majority with five weeks to go until election day.

The race has proved lacklustre so far, with Merkel only returning from a two-week holiday in the Alps last week.

The centre-left Tagesspiegel recently printed a political cartoon showing Steinbrueck exhausting himself with shadow boxing while Merkel snoozed in an easy chair.

Meanwhile Steinbrueck has stumbled into a series of gaffes that have led even senior Social Democrats to question his strategy.

He has complained that the chancellor's salary is too low, suggested that Merkel owes her success to being a woman and recently questioned her "passion for Europe" because she grew up in the former communist east.

"(Many Social Democrats) are talking about what's gone wrong during the campaign, as if they're already anticipating the discussion that will come after the election -- who's responsible for the bad outcome," political scientist Jens Walther of Duesseldorf University in western Germany told AFP.

Merkel, for her part, never mentions her opponent by name in public, but said in a recent interview that the SPD's plans to hike income taxes on the wealthy would be economic "poison."

She got another boost last week when data showed that the eurozone economy had emerged from an 18-month recession, appearing to back up her claim that her austerity drive to battle the debt crisis is panning out.

Merkel, who is widely seen as a foregone conclusion to remain chancellor, said Saturday she could well imagine a rerun of a grand coalition if her alliance with the FDP failed to muster a majority.

"I led a grand coalition once so I wouldn't be credible at all if I ruled one out," she told the daily Frankfurter Allgemeine Zeitung, while stressing her strong preference was for a centre-right government.

But she warned against too much pre-election swagger at a rally in the northern town of Cloppenburg Saturday. "The election is many things but it's certainly not wrapped up," she said.

Steinbrueck has said he would not take part in another grand coalition and the prospect of a second link-up with Merkel fills the party with dread.

The SPD watched helplessly as Merkel took credit for the government's achievements including an improving economy.

Those in the crowd in Berlin said that Steinbrueck had touched on issues that mattered to them such as growing economic inequality.

"I was moved by the speech. He touted basic values -- it would be great if he could put them in action," said Christine Rieger, a pensioner from Duesseldorf.

But she admitted it would be an uphill battle.

"They won't manage to beat Merkel, she's too strong," she said, adding that she, like about a quarter of Germans, wanted another grand coalition.