Just 11 months after the creation by neo-communists and defectors from the centre-left Social Democrats, Die Linke, or The Left, is now Germany’s third largest political force.

With increasing discontentment in Europe’s biggest economy over rising prices and the growing gap between the rich and poor, support for the party and its populist agenda has rocketed.

It now holds seats in 10 of Germany’s 16 states, not only in the deprived, formerly communist East Germany but also in four states in the wealthier former West.

Fiercely pacifist, the party wants Germany to withdraw its 3,200 troops from Afghanistan and to take Germany out of the NATO military alliance. It also has strong misgivings about the European Union.

This surge of support has made it more popular with voters than the traditional kingmakers in Germany’s previously cozy political scene, the Greens and the liberal Free Democrats (FDP).

Chancellor Angela Merkel’s conservative Christian Democrats (CDU) have been in an uneasy governing coalition with the SPD since 2005, and all the parties are now looking ahead to the next elections in September 2009.

Die Linke, having shaken up the political scene, could make things interesting. Opinion polls suggest it could win 14 percent of the vote.

Both the SPD and the CDU want to win enough votes to ditch the other in order not to have to endure another four years of their grand coalition.

But they are unlikely to win enough votes to govern alone, so both are starting to look around for possible partners.

The combinations are not obvious. The CDU’s traditional allies are the FDP, but it is uncertain they will garner enough seats between then, a situation shared by the SPD and their partners between 1998 and 2005, the Greens.

The SPD’s only choice may be to work with Die Linke, but the reaction to talks about such a tie-up at regional level showed SPD members were fiercely opposed.

Oskar Lafontaine, the charismatic former chairman of the SPD and now one of the heads of the Die Linke, feels he has the other parties on the run.

“The wind of history is blowing in our sails,” Lafontaine told the 562 party faithful who made the journey to Cottbus near Berlin, promising on Sunday to “change politics.”

“Other parties are adopting our positions … Let us be a party that dares to go against the spirit of the times,” Lafontaine told the crowd from an all-red podium in a speech citing Marx, Engels and even Mikhail Gorbachev.

The party members adopted a motion that would see an increase of €50 billion ($78 billion) in annual spending on health care, education, the environment and public services.