Socialism Fading in Europe as it Engulfs U.S. with Obama's Fiscal Fog (CPB) Or is this Reverse Psychology? (POTC)

PARIS (AFP)--The defeat of the Social Democrats in German elections dealt a setback to European Socialists struggling to make their voices heard during economic hard times.
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German Chancellor Angela Merkel won re-election at the head of a new center-right coalition in the vote Sunday, ending four years of power-sharing with the Social Democrats.
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A debacle also looms for the U.K.'s Labour Party, with polls showing its 12 years in power will come to an end in June elections, while French Socialists remained bogged down in squabbling.
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Socialists in Portugal won a second term in weekend elections, but lost their absolute majority.
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The blow to Germany's SPD Social Democrats comes four months after European conservatives won a decisive victory over center-left parties in European Union parliamentary elections.
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Prominent French Socialist Jean-Christophe Cambadelis called the German election outcome a "dark day for social democracy" that keeps right-wingers firmly at Europe's helm.
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"The Merkel-Sarkozy-Barroso axis has moved further to the right, further toward free-market liberalism as a result of this election," said Cambadelis, referring to French President Nicolas Sarkozy and European Commission president Jose Manuel Barroso.
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"The SPD has registered a sharp drop which reflects the breakdown of social democracy in Europe," said Cambadelis.
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Spain's Socialist Prime Minister Jose Luis Rodriguez Zapatero said the Social Democrats "had obviously undergone a correction" but insisted there was no major change to the European political landscape.
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"Is the tide turning in favor of conservatives? That's not true. Each country votes according to its national circumstances," said Zapatero, who won re-election last year for a second four-year term.
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Zapatero argued the Social Democrats had lost support due to the change of leadership and their role as a junior coalition partner, overshadowed by Merkel's conservatives.
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"It is a situation in which, in the end, you cannot define your own political identity and your project," he said.
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The Social Democrats won 23% of the vote, their worst result since World War II, but the far-left Die Linke made its best showing yet with 13%.
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The poor showing of the Social Democrats was closely scrutinized by Socialists in France, who have been bogged down in squabbling and unable to mount a challenge to the right.
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France's main opposition Socialist Party has lost three consecutive presidential elections and Sarkozy appears in a strong position to seek re-election in 2012. Two prominent French Socialists pointed to the SPD debacle as a sign the left must shun alliances that dilute its left-wing agenda.
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"The SPD's alliance with the right resulted in its lowest score ever. The big winners of this political confusion are invariably the conservatives and free-market advocates," said Benoit Hamon and Henri Emmanuelli.
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The Social Democrats' defeat must serve as a warning to leftists to seek broad reforms and present fresh ideas, said French Socialist deputy Claude Bartolone.
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"We can see that there is a strong expectation, even among the Germans, for another system, another economic model," said Bartolone.
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But the French governing right seized on Merkel's victory as a sign that in times of economic crisis, voters preferred right-wingers, even though Merkel's Christian Democrats made their worst showing in five decades, with 34%.
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The German election outcome shows that "when the right is managing Europe's affairs, in particular during times of crisis, it enjoys the people's trust," said Patrick Devedjian, France's minister for economic recovery and a close aide to Sarkozy.
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(END) Dow Jones Newswires
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September 28, 2009 11:16 ET (15:16 GMT)- - 11 16 AM EDT 09-28