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Behind the Swedish verdict

The victory of Sweden's Centre-Right coalition against the country's oldest party, the Social Democratic Party, in the recent general election is in line with a trend witnessed in recent years across major European countries — the trend of the political Right re-inventing itself by seeming to move towards the `Centre.' Key elements in the Centre-Right agenda are, of course, tax cuts, privatisation, and deregulation but the combination tends to project itself as a pragmatic defender of Europe's cherished cradle-to-grave welfare state. The foreign policy orientation varies, of course, from country to country. A parallel process is the rightward movement of sections of the European `Left.' The Swedish verdict revealed the electorate's disenchantment with the incumbent government despite positive factors such as robust economic growth, a low rate of inflation and low interest rates, and a relatively low level of unemployment in comparison with other major European economies. The conservative Moderate Party seized the advantage early in the campaign and forged a four-party coalition — the Alliance for Sweden — that included the Christian Democrats. Learning from the setback it suffered in the 2002 election, the Moderate Party was careful to distance itself from the image of a party of hard-boiled free-marketers. At the same time, Fredrik Reinfeldt, its 41-year-old leader who will become Sweden's next Prime Minister was able to sell the traditional conservative plank — of `rolling back the state' and easing restrictions on the labour market — as a more effective strategy to raise economic growth and generate jobs than the Social Democrats' proposal of increasing unemployment benefits.

Mr. Reinfeldt is expected to take office after the Riksdag, the Swedish parliament, convenes on October 2. Under the Swedish system, if the electorate votes for a new government, the Speaker proposes a candidate for the post of Prime Minister after holding consultations with party leaders; the Riksdag then votes on the proposal and if approved, the Prime Minister-designate forms the government. What is clear is that, under European conditions, there is growing support for the view that while the social safety net needs to be protected, the provision of welfare on a mass scale can be sustained over the long term only under conditions that can boost productivity and generate employment. On the other side, the implementation of structural adjustment policies by social democratic and Centre-Left governments in recent decades has made them virtually indistinguishable from Centre-Right dispensations and has inevitably led to electoral disenchantment. The Swedish Social Democrats and their allies in the Left and Green parties will have plenty of time to rethink their strategy and tactics as the coalition led by Mr. Reinfeldt goes about the tricky business of negotiating the political shoals.

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