BERLIN -- Battling to win re-election, German Chancellor Gerhard Schroeder on Sunday continued his shift to the left with an attack on U.S. economic practices and big business.

Speaking in Berlin to leaders of his Social Democratic Party (SPD), Schroeder drew long applause when he pointed an accusing finger at the United States, DPA reported.

"Undesirable developments" are washing over from the U.S. such as stressing shareholder value and not paying enough attention to the rights of workers, Schroeder warned.

"This has nothing, absolutely nothing to to do our idea of economic values," he said, adding that the economy was there for the people and workers were not there to simply serve the economy.

"It must be clear...we don't want to have this in germany," said Schroeder.

The German leader is struggling to win a second term in September 22 general elections. Schroeder trails his conservative challenger, Edmund Stoiber, in all opinion polls by four to seven percentage points.

In past weeks the chancellor has turned up leftist rhetoric and seemingly abandoned what he termed the "new center" in his successful 1998 election victory over conservative chancellor Helmut Kohl.

Schroeder attacked German business leaders for rejecting his labor market reforms hammered out under Volkswagen AG Personnel Chief, Peter Hartz.

"Stop blocking this reform!," said Schroeder to applause of party leaders who voted to approve the Hartz package as SPD policy.

Schroeder grumbled that big business should embrace the plan as German trade unions have done.

The Hartz Commission says it can cut German joblessness by 50 percent to two million by 2005 with billions of euros in low-interest loans and equity injections and streamlining state job-placement agencies. Workers would get certificates which could be cashed in by companies which hire them under the proposals.

But the plan brushed aside more radical calls to reduce unemployment benefits or loosen Germany's strict laws protecting workers from being fired.

Business leaders have rejected the Hartz proposals as "watered down" and insufficient to cure German unemployment which is almost 10 percent and rising.

The news magazine ****Der Spiegel*** quoted Switzerland's Prognos Consulting Group as predicting the Hartz reforms would create at the most 100,000 to 200,000 new jobs.

Turning to Iraq, Schroeder repeated his opposition to any U.S.-led strikes on Baghdad despite having received an unusual rebuke from Washington.

The American Ambassador to Germany, Daniel Coats, went to the chancellery last week to deliver a message of Washington's displeasure over Schroeder's anti-Iraq war remarks.

"Washington is not happy at the accusation that it is not consulting with its allies or that U.S. President George W. Bush is a 'trigger-happy Texan'," said a report in the *****New York Times***** quoting a senior American official.

Schroeder, who earlier this month vowed Germany would send neither troops nor funds for an Iraq war, again warned that strikes on Iraq would unleash a crisis.

"Friendship does not mean we say 'yes' and 'amen' to everything," said Schroeder.