SPD defeat gives jolt to Schroeder

Chancellor Schroeder will look to strengthen his coalition, say analysts

BERLIN, Germany -- Gerhard Schroeder's Social Democrats are coming to terms with the thrashing they received in a regional election that newspapers said spelt bad news for the German chancellor's re-election hopes in September.

The centre-left SPD collapsed to third place in Saxony-Anhalt on Sunday, behind the conservative Christian Democrats (CDU) and the post-communist Party of Democratic Socialism (PDS).

"Shock for Schroeder!" wrote Bild newspaper on its front page. "Worst SPD defeat of all time!"

The SPD, who governed the poor eastern state for eight years, dropped to 19.9 percent -- 16 points down on the last election in 1998. The PDS came second with 20.4 percent.

The conservative CDU, which supports Bavarian premier Edmund Stoiber against Schroeder in the September 22 vote, were the clear winners, adding more than 15 points to 37.4 percent, according to preliminary results.

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"The federal elections in five months are still far from being decided, but the chances for a new SPD-Greens majority are now even lower than Germany's team winning the World Cup this summer," wrote Hugo Mueller-Vogg, a columnist for Bild, referring to Germany's struggling soccer team.

The CDU looks set to form a government in the state with the liberal Free Democrats (FDP), who surged to 13.3 percent from 4.2 percent in 1998. Analysts say that could be a precursor for a CDU-FDP coalition at federal level after September.

"It was vote primarily against SPD state premier Reinhard Hoeppner," said Juergen Falter, political scientist at Mainz University, adding voters were fed up with the SPD's inability to cut unemployment in the state. "It wasn't a pro-CDU vote."

Boost for CDU

Saxony-Anhalt has the lowest per capita income of any German state and the highest jobless rate -- twice the national average at more than 20 percent. Since reunification in 1990, its economy has fared worse than conservative-governed parts of former East Germany to the south.

Sunday's result in the state is not expected to be replicated in September but it does give conservatives new political ammunition for their campaign to beat Schroeder.

"It wasn't a test election but it has turned into an important signal," said the Frankfurter Allgemeine Zeitung newspaper. "It shows that the CDU lead in the voter surveys can be converted into election victories. It's an enormous boost for the CDU."

Franz Muentefering, Schroeder's deputy in the SPD and the party's campaign manager, said he was confident his party would win in September but admitted the contest would not be easy.

"This was a terrible defeat for the party and for Saxony-Anhalt," Muentefering told ARD television on Monday.

The liberal Sueddeutsche Zeitung newspaper said the Saxony-Anhalt result made it more likely Schroeder would opt to add the PDS to his SPD-Greens coalition in September to stay in power, even though Schroeder has so far ruled the PDS out.

"First of all, Schroeder will have to help the Saxony-Anhalt SPD out of their deep shock -- and then he will look to hold all options open. Schroeder will do everything he can (to stay in power) -- including adding the PDS to his coalition.

"The outlook may look better for Stoiber now, but Schroeder has the most options to choose from," the Sueddeutsche said.

The SPD lags two to five percentage points behind the CDU in national polls. The SPD and Greens would fall short of a majority but could take a narrow majority by adding the PDS.