In February 2003, elections took place in the states of Hessen and Lower Saxony, both leading to overwhelming victories for the conservatives. In Hessen, the CDU minister president Roland Koch was re-elected, with his party CDU gaining enough seats to govern without the former coalition partner FDP. In Lower Saxony, the former SPD minister president Sigmar Gabriel lost the elections, leading to an CDU/FDP-government headed by new minister president Christian Wulff (CDU). Both elections are seen as symptomatic for a widespread criticism against the current federal red-green government.
The protest against the Iraq war changed this situation a bit, favouring SPD and Greens.
The latest election in the state of Bavaria led to a landslide victory of the conservatives, gaining not just the majority (as usual), but two thirds of parliamentary seats.
In April 2003, chancellor Schröder announced massive cuts in the social systems, called Agenda 2010. The changes include much-disputed reforms to the labour market and unemployment system, known as Hartz I - Hartz IV.
The European elections on June 13, 2004 brought a staggering defeat for the Social Democrats, who polled only slightly more than 21 %, the lowest election result for the SPD in a nationwide election since the Second World War. Liberals, Greens, conservatives and the far left were the winners of the European election in Germany, because voters were disillusioned by high unemployment and cuts in social security, while the governing SPD party seems to be concerned with quarrels between the party wings and unable to give any clear direction. Many observers believe that this election marked the beginning of the end of the Schröder government and indicates a process in which the SPD party seems to shrink and/or fall apart.