Senior leaders in the Social Democratic Pary (SPD) have decided that Steinmeier will run against incumbent Chancellor Angela Merkel in next year's federal elections, according to reports on Saturday, Sept. 6, by the Berliner Zeitung and Spiegel Online.

The two Web sites reported, without citing sources, that Steinmeier's candidacy would be announced at Sunday's party conference.

Though the Social Democrats appear to have reached one important decision in selecting Steinmeier, their meeting comes at a time of deep internal divisions.

Widespread dissatisfaction over the leadership of party chairman Kurt Beck and the zig-zag course he has followed in dealing with the rise of the new socialist Left Party have alienated many in its traditional support base.

Even in Beck's home state of Rheinland-Palatinate, where the SPD has held power since 1991, voters are swinging to Chancellor Angela Merkel's Christian Democrats (CDU).

A poll published Friday showed 38 percent of the electorate backing the CDU, against just 36 percent for the SPD, which secured 45.6 percent of the vote in the March 2006 state election -- a fall of almost 10 percentage points over little more than two years.

Rise of the Left

The dilemma facing the party is illustrated by another poll published this week. In the small western state of Saarland, the traditional party of the left has fallen to 23 percent -- behind the Left Party on 24 percent.

The Left has been boosted by the announcement that Oskar Lafontaine will lead the party in state elections next year. Lafontaine enjoys great popularity in the state, where he was SPD premier for 13 years to 1998.

Until this year, the SPD had seen itself as immune to threat from this flank, at least in the states of the former West Germany -- the bulk of post-1990 reunified Germany.

Split over Schroeder's reforms

But the Left Party, which draws its main support in formerly communist East Germany, has bounded ahead in the West as well, attracting disgruntled trade unionists and eating into the SPD's traditional support base.

The SPD is bitterly divided over the legacy left it by former chancellor Gerhard Schroeder when he was voted out of office in September 2005.

Schroeder's Agenda 2010 reform program is widely credited with cutting unemployment by two million over the past three years and with putting the German budget on course towards balance in 2011.

But those on the left of the SPD are scathing about its effects on the marginalized in German society, who have seen their social security benefits slashed.

State exemplary of new party landscape

The split in the SPD is exemplified in another western state -- Hesse -- where local SPD leader Andrea Ypsilanti narrowly failed to oust CDU premier Roland Koch in elections in January, leaving the state legislature without a clear majority and Koch in power at the head of a caretaker administration.

The 5.1 percent secured by the Left, contesting the Hesse election for the first time, effectively blocked an SPD victory.

Ypsilanti backtracked on a campaign pledge not to enter into any kind of cooperative agreement with the Left and said she would seek to form a minority government with the Greens on the basis of tolerance by the Left.

Beck flip-flopped on the move, but finally gave it his blessing, only to see it founder on opposition within the SPD at state level.

Now Ypsilanti is set to try again, despite widespread fears within the party that any association with the former communists could prove electoral poison for the SPD in next year's federal elections.

In this divided atmosphere, party chairman Beck is under pressure on all sides.

Strong support for Steinmeier

There has been a growing wave of support for Frank-Walter Steinmeier to stand for the chancellorship in September next year. The foreign minister has the highest approval ratings of any German politician in the polls, surpassing even Merkel herself.

But, as Schroeder's chief of staff while in office, the charismatic foreign minister is closely associated with the former chancellor's policies and would be unlikely to countenance any kind of deal with the Left, whether at state or federal level.

Steinmeier has another disadvantage. He has not come up through the party ranks the way Beck, who has been premier of Rhineland-Palatinate since 1994, has and thus lacks backing within the party establishment.

Possible kingmaker returns

Meanwhile, another heavyweight from the Schroeder era has returned to the fray -- Franz Muentefering, Labor Minister in Merkel's cabinet until resigning last year to care for his terminally ill wife.

At a rally of the Bavarian SPD in Munich this week, "Muente" signalled his comeback, drawing an ecstatic response from party supporters in the city's Hoffbraeukeller ahead of Bavarian state elections at the end of the month.

He explicitly backed Schroeder's Agenda 2010 reforms, urging the party to show pride at its achievements and greater self-confidence.

At 68, Muentefering is unlikely to be a direct threat to Beck but could prove kingmaker if he throws his weight behind Steinmeier.

And that in turn could set the SPD, Germany's oldest political party, on a course away from any deals with the Left.