Observations on Sweden
"No mandate for a system shift," declared the Swedish tabloid Aftonbladet, and there was little doubt about it. The narrow election defeat of the Social Democrats does not mean the death of the famed "Swedish model", with its huge welfare state, that the party spent the past 70 years creating.
In a striking reversal of the political trends in most of the rest of Europe, the non-socialists owe their victory not to promises of radical tax cuts, deregulation and reductions in state spending, but to the clear abandonment of any suggestion that they will do those things.
Far from pledging to destroy the model, the incoming prime minister, Fredrik Reinfeldt, leader of the so-called "new" Moderate Party, and his coalition partners, the Liberals, the Centre Party and the Christian Democrats, have promised to improve it.
Defeated four years ago on a more conventional right-of-centre manifesto, this time they took care to reassure Swedish voters that there was never any hidden neoliberal agenda to dismantle their beloved social and economic system, which combines a competitive economy with a compassionate society and has achieved the rare feat of delivering both affluence and equity.
During the campaign, Reinfeldt, a charismatic 41-year-old, emphasised his social conservatism rather than any modernising zeal, and made the creation of jobs and full employment the first priorities.
His "Alliance for Sweden" raised its standard in classic Social Democrat territory, with a relentless attack on the country's high unemployment, especially among young people - an embarrassment to the Social Democrats, who always took great pride in their successful labour-market programmes.
As a strategy, it succeeded. A small but significant number of traditional left voters backed the Moderates this time because of their commitment to the creation of jobs. Such shifts of voters between left and right are almost unknown in Sweden.
Whether Reinfeldt and his colleagues can now deliver those jobs through the mixture of tax incentives and subsidies they propose is questionable. What may help them is the booming Swedish economy, one of the strongest in the world - with high trade and current account surpluses, low inflation and a growth rate above 5 per cent this year.
During their two previous periods in government in the past 30 years - the mid-1970s and early 1990s - Sweden's non-socialist parties were unlucky enough to face economic crises that overwhelmed them. Now they can build from an enviable economic strength. No doubt, David Cameron's "new" Conservatives will be watching with interest.
For the Social Democrats the result is disastrous, one of the worst in their history, although the left bloc is only seven short of a majority in parliament.
Its leader, Göran Persson (once close to Tony Blair, but less so recently), ran a lacklustre campaign and announced his resignation as both prime minister and party leader on election night after ten years in office. A new leader, probably a woman, will be elected next spring and the Social Democrats can be expected to begin a fundamental renewal in opposition.
At least they can draw some comfort from knowing that the Reinfeldt government will have to accept and run what remains essentially a social-democratic system. In his radical-right youth, Reinfeldt once called it an "impossible construction", but he knows now that if he tried to destroy it, his time as Swedish prime minister would be short.
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