By GEIR MOULSONAssociated Press
BERLIN (AP) - Chancellor Angela Merkel and her center-left rival sparred over Europe's debt crisis and how best to keep Germany's economy strong as they faced off Sunday in a televised debate ahead of Sept. 22 elections, with Merkel's challenger insisting that it makes no sense to apply a "deadly dose" of austerity to eurozone strugglers.
Challenger Peer Steinbrueck went into the 90-minute debate - the pair's only direct TV encounter of the campaign - facing a daunting poll deficit and needing a strong performance after a summer in which the opposition has struggled to land blows on the popular conservative incumbent.
Neither contender scored a knockout blow or made a major mistake, and polls conducted by broadcasters showed no clear winner. In his opening statement, Steinbrueck portrayed Germany as having "gone round in circles, without direction" under Merkel's center-right coalition over the past four years.
Merkel has benefited from a healthy economy, low unemployment and perceptions that she's managed Europe's debt crisis well. She touted that record as the debate opened, pointing to high employment and portraying Germany as "the motor of growth" and "the anchor of stability" in Europe.
Merkel's finance minister last month said that there will have to be a third aid program for Greece after the current one ends last year - something that the chancellor again insisted is nothing new.
Germany, with Europe's biggest economy, is the biggest contributor to the 17-nation eurozone's rescue programs. Merkel has pursued a hard-nosed approach - insisting that struggling countries get their finances in order, take responsibility for their own problems and enact economic reforms.
Steinbrueck asked "whether, with the announcement of a third Greek package, we shouldn't admit to ourselves that the crisis strategy to date - largely put forward by this government - has failed." He argued that "what is lacking is a rebuilding program, what is lacking is a growth impulse, what is lacking is the fight against youth unemployment."
"I would have said, of course there must be consolidation of public budgets - but please not in a deadly dose for these countries," he said.
Merkel noted that Steinbrueck's Social Democrats have voted for the various measures she has put forward in the crisis - including a European budget-discipline pact - and insisted that her approach is the way to fix the eurozone's troubles.
"Do we help by expressing regret about the difficult situation in these countries, or do we help by encouraging them to conduct the necessary reforms?" she asked.
"What is important now is not to show false solidarity, but to follow a principle - and this principle is ... solidarity and responsibility, and if we do not follow this through we will see that these countries don't regain more jobs," she said. Merkel pointed to efforts that have been made to encourage growth in Europe.
On the home front, Steinbrueck said he wants to ensure greater "social justice," introducing a mandatory national minimum wage - which Merkel rejects, preferring sector-by-sector agreements between employers and employees.
He defended plans to raise income tax for top earners. Merkel argued that raising taxes would risk endangering jobs, and pointed to the government's high tax take at present - "we must get by with that and we can get by with that."
Steinbrueck said that "we don't want to raise all taxes for everyone." He argued that the gap between rich and poor in Germany has widened over recent years, and the richest "have a responsibility to contribute more strongly to public financing," for example to pay for education and cut government debt.
The challenger insisted that Merkel's government still hasn't cleared up "what damage arose" to Germany as a result of surveillance by the U.S. National Security Agency - an issue that so far has failed to shift polls.
"On German soil, we have no reason at the moment to say that the NSA spies widely on Germans," Merkel said.
Recent surveys have given Merkel's conservative bloc a large lead over Steinbrueck's Social Democrats and suggested that her current center-right coalition can hope to win re-election.
Steinbrueck was Merkel's finance minister in her 2005-9 "grand coalition" of right and left - an experience that both insist they don't want to repeat, but could emerge from an indecisive election.
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