Chancellor Gerhard Schroeder's party suffered humiliating defeats in regional elections in the German leader's home state of Lower Saxony and in the state of Hesse today. Voters punished the national government for the country's economic stagnation and brushed aside Schroeder's attempts to capitalize on his opposition to a possible war in Iraq.

The conservative opposition Christian Democrats won 48 percent of the vote in Lower Saxony, according to exit polls, and would take control of the statehouse by governing in a coalition with the pro-business Free Democrats.

Schroeder served for eight years as governor of Lower Saxony before becoming chancellor in 1998. His party, the Social Democrats, slumped to 33 percent, ending 13 years of party rule in the northern state. The conservatives' tally jumped 12 points.

In Hesse, home to the nation's financial capital, Frankfurt, the governing Christian Democrats surged 11 points to 50 percent of the vote. The Social Democrats had 28 percent, down from 39 percent in the last election, according to exit polls.

Today's results underscored the widespread unpopularity of the national coalition government of Social Democrats and Greens, which after winning federal elections by the narrowest of margins last September introduced a raft of new taxes to close a widening budget deficit. But the measures were widely seen as disastrous -- failing to improve Germany's economic growth rate, which at 1 percent is the lowest in the European Union, or to lower the unemployment rate, which has topped 10 percent.

The loss of Lower Saxony, where the Social Democrats were in coalition with the Greens, will solidify the opposition's control of the upper house of the federal parliament, where membership is determined by the strength of parties in the states. That will handicap the ability of Schroeder's government to pass legislation without the conservatives' approval.

Schroeder had galvanized voters last fall with his opposition to a war in Iraq, and his party continued to push the issue last week.

The leader of the Social Democrats in Lower Saxony, Sigmar Gabriel, suggested that the United States was motivated only by its thirst for oil. "I am not prepared to send boys and girls into a war solely for that purpose," Gabriel said in a televised debate. "I think that's wrong."

The opposition interpreted today's results as a rebuke of the government's foreign policy.

"It especially pleases me [that Schroeder] was not successful a second time in exploiting the fears of people with populism regarding Iraq," the conservatives' leader, Angela Merkel, said at a jubilant party headquarters in Berlin tonight. "This is also a very important signal for our allies."

Germans remain solidly opposed to war in Iraq, however, even if it is sanctioned by the United Nations, a recent poll showed. But as that cause faded as a campaign rallying point, economic issues returned to the fore, exposing Schroeder to the electorate's dismay.

Some German analysts say Schroeder will be forced into a de facto alliance with the conservatives to push through difficult welfare and labor market reforms.

"Disenchantment with the government is at an enormous high," Tilman Mayer, professor of political science at the University of Bonn, said in an interview. "Schroeder will have to function as a statesman now, above party lines. He will need to include the opposition, and he will move towards them."

Wolfgang Clement, the federal economics and labor minister, suggested last week that the government would soon make common cause with the conservatives. After the elections, he said, would be a good time to open "the window for reforms."

But such change is anathema to trade unions, a critical grass-roots base for the government. Clement, however, appears to want to marginalize the unions through an informal alliance with the conservatives -- if the suddenly ascendant opposition is willing to help shape policy.

"I'm optimistic when the election campaigns are over the government will put its foot on the accelerator and the opposition will cooperate," Michael Rogowski, head of the Federation of German Industry, said in today's Welt am Sonntag newspaper.