The foreign service, the defense ministry and other departments are also slated for budget cuts. But it is the cutbacks in the welfare system that have split the party. One of Schroeder's most public opponents within the SPD is the leader of the party's left wing, Reinhardt Klimmt, premier of the province of Saarland. Another internal critic is Richard Hoppner, premier of the province of Saxony Anhalt, in what was formerly communist east Germany. A group of trade union leaders recently issued a statement acknowledging that Schroeder's goal is to make Germany more competitive and to bring unemployment below the current 10 percent.
Public reaction is still unclear.
For Schroeder personally, the key date is the SPD party congress in December where representatives of all factions in the party will debate his program. Some draw parallels with the historic congress in Bad Godesberg in 1959. Most German economic analysts agree that Germany's rigid system, including its labor market rules, must be overhauled if it is to remain competitive. This appears to be borne out by the latest rankings of global competitiveness by the World Economic Forum. They show that Germany has slipped to 25th place.