World IN BRIEF / GERMANY : Ruling Party Loses in 2 State Elections

Chancellor Gerhard Schroeder lost a key electoral test when his governing party ceded a majority in two states that have been Social Democratic strongholds. The elections in eastern Brandenburg state and tiny Saarland near the French border were considered referendums on Schroeder’s centrist policies and unpopular reforms to Germany’s generous social welfare state. Schroeder said controversial budget cuts that he is pushing are critical to ensuring Germany’s economic recovery. The results will cost the Social Democrats several seats in the upper house of Parliament. That will make it harder for Schroeder to push through planned $17-billion cuts in social spending that have split his own party and hurt its image at the federal level. Schroeder said he was dismayed that voters in Brandenburg gave 5.5% of the vote to the right-wing German People’s Union, allowing it into the state assembly. The party conducted a massive advertising campaign that blamed Germany’s woes on foreigners.