Chancellor Gerhard Schroeder's ruling Social Democratic Party suffered serious losses in two state elections today, reflecting the unpopularity of a controversial austerity program that the German leader says is necessary to revitalize the world's third largest economy.
In the eastern state of Brandenburg, the Social Democrats won about 39 percent of the vote, a drop of 15 points from the previous election that will cost the party its absolute majority in the state assembly. Voter dismay with rampant joblessness was reflected in a breakthrough for the far-right German People's Union, or DVU, which cleared the 5 percent hurdle needed to gain seats in the state parliament with its vitriolic anti-immigrant platform.
In tiny Saarland near the French border, the Social Democrats lost control of the state legislature to the Christian Democrats for the first time in 14 years. The swing to the conservatives will complicate Schroeder's efforts to secure approval for his reform program from the upper house of the federal Parliament, which is structured to reflect the balance of power among Germany's 16 states.
"There is no reason to beat around the bush, we have clearly lost both elections," Schroeder said at party headquarters here. "I am sad and disappointed, but you should not confuse this with a lack of a desire to fight."
Schroeder upbraided left-wing critics within his party for speaking with "too many voices" and acknowledged that the fierce squabbling over plans to cut $16 billion in pensions and welfare payments contributed to its demise. But he emphasized that his "Red--Green" government of Social Democrats and Greens remained committed to streamlining Germany's bloated welfare system to cope with competitive pressures in the global economy.
Schroeder said the Social Democrats must learn from their electoral setback, starting with the failure to rally behind their leader and his austerity message. Reinhard Klimmt, the outgoing Saarland premier, was one of the chancellor's leading critics who accused him of selling out the interests of the party's working class constituency.
In Brandenburg, where the Social Democrats must now choose between ruling in tandem with former Communists or the Christian Democrats, Schroeder deplored the vote share of "the right-wing morass" that he lamented as "a shocking blow" to Germany's image.
The rise of the DVU, whose xenophobic policies are winning support among alienated youths in eastern Germany, has been orchestrated and financed by millionaire Munich-based publisher Gerhard Frey. The far-right party won nearly 13 percent of the vote last year in Saxony-Anhalt and followed the same campaign strategy in Brandenburg, where it spent more money than any other party on direct mail appeals to every voter under 30.
CAPTION: Chancellor Gerhard Schroeder says he is "sad and disappointed" with losses in two state elections, but vows to fight for his economic plan.