Germany’s ruling Christian Democrat party (CDU) suffered another defeat at the polls this weekend. After losing their majority in the industrial western state of North Rhine-Westphalia last year, Chancellor Angela Merkel’s conservatives were decimated in local elections in Hamburg where the Social Democrats (SPD) nearly won an outright majority — a novelty in coalition heavy German politics.

The loss of North Rhine-Westphalia robbed the federal government of its majority in the upper house of parliament last May after Germany agreed to participate in a bailout scheme for ailing Greece.

As Europe’s largest economy, Germany has contributed nearly €120 billion to a stabilization fund that is designed to fend off concern of sovereign default in countries as Portugal and Spain. Voters are coping with austerity measures at home though while their government is apparently subsidizing weak economies in the south where people enjoy far more generous welfare provisions.

The liberals, the minority partners in Merkel’s cabinet, did relatively well in Hamburg this weekend where voters awarded the largest opposition party SPD with a spectacular 48.3 percent of the vote. Nationally however, the Free Democratic Party, favoring lower taxes and limited governments, has bore the grunt of dissatisfaction with the ruling coalition. As the government is enacting spending cuts, opposition parties are naturally gaining strength.

The SPD hopes that its victory in the city state that is Hamburg could herald a national resurgence. The party saw its support plummet in the most recent general election, winning a meager 23 percent of the vote in 2009 — its worst performance since the end of World War II.

The conservatives fear a repetition of Hamburg in the southern state of Baden-Württemberg, a traditional CDU bastion where there will be an election next month.

While the far left has also been on the rise, the conservative newspaper Die Welt doesn’t see a future in a coalition of Social Democrats, Greens and Die Linke. “Power lies in the center,” they believe.

According to the Frankfurter Allgemeine Zeitung, the conservatives’ alliance with the Green Party, inspired by a need to appeal to young, urban voters, has also failed. The CDU should ask itself: “What could a modern, urban center-right party, that does not depend on the Greens as a coalition partner, look like?”

The leftist Die Tageszeitung doesn’t rule out a federal coalition of conservatives and Greens however. As labor parties all across Europe are struggling to regain relevance, the SPD hasn’t yet managed to reinvent itself as a broad and centrist platform for reform. Young urban professionals prefer the more cosmopolitan Green Party while the CDU continues to depend on a largely rural and aging constituency.