"I would have said, of course there must be consolidation of public budgets â¿¿ 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 â¿¿ including a European budget-discipline pact â¿¿ 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 â¿¿ 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 â¿¿ 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 â¿¿ "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 â¿¿ an issue that so far has failed to shift polls.