Sweden’s elections at the beginning of September will attract a great deal of international attention. A country that for decades has been a bastion of social democracy is witnessing a collapse of the socialist movement.
While Sweden has been admired internationally for its knowledge economy and good social outcomes, rising crime and social tensions have given a boost to the nationalist, anti-immigrant Swedish Democrats.
For decades, Sweden was seen as a model society. As early as 1976, Time described the country as a social-democratic paradise: “It is a country whose very name has become a synonym for a materialist paradise… No slums disfigure their cities, their air and water are largely pollution-free.”
Bernie Sanders campaigned on a promise to bring a Nordic social democratic model to America, while Barack Obama was reportedly fond of musing to his aides: “Why can’t all countries be like the Nordic countries?”
In many ways Sweden is a society to be admired. It combines basic welfare services with ambitious free-market reforms. Along with Switzerland, it is the most knowledge-intensive economy in Europe. Sweden is far ahead of other EU countries in this respect, with almost one in ten workers involved in so-called Brain Business.
Despite that, the economy is growing quite sluggishly, with projected growth of 2.4 per cent in 2018. And much of this is driven by a
population rise, through migration. Once the population increase is taken into account, the rate is just 1.2 per cent per capita.
Between now and 2022 the increase in living standards is expected to be a meagre 1 per cent per year. What growth there has been has been sustained by household borrowing, with average household debt now standing at 185 per cent of incomes — a record rate. Thanks to the central bank’s negative interest rate, Swede’s have been encouraged to borrow to buy new cars or do up their homes.
They are, however, less happy about the rise in violent crimes, with shootings and murders now part of the daily news cycle. The Swedish National Council for Crime Prevention begun gathering statistics on people shot to death in 2011 – before then shootings were such a rarity that statistics were not compiled systematically. In 2011 year 17 people were shot dead.
By 2017 this figure had increased to 42. This year, a new record will almost certainly be set.
For many years the Swedish social democratic party had a near monopoly on power, regularly gaining between 40 and 50 per cent of the popular vote. That came to an end in 2008 with the election of a centre-right government, which implemented significant tax cuts and privatisations.
The centre-right government also implemented an open border policy in alliance with the left-leaning Greens. Sweden, which was already accepting a high rate of refugees, was overwhelmed with new arrivals. The peak occurred after a new social democratic minority government had taken over in 2014. Stefan Löfven, the new prime minister, proclaimed that Sweden would not set any barriers in the way of immigrants and that there was no set limits on how many the country would accept.
In reality, however, the refugee influx put serious strain on both housing and public sector budgets. In 2015 the country took in nearly 163,000 asylum seekers along with many family reunion migrants — this in a country whose population is only about 10 million. The political parties and media were forced to back off from the previous open borders policies to a controlled migration approach.
The Swedish Democrats have been the main beneficiaries of popular dissatisfaction with immigration and gang-related crime.
The party, which was originally associated with the neo-Nazi movement, has steadily gained in popularity since the 1991 parliamentary elections, when it registered just 0.1 per cent of the vote. Its big breakthrough came in 2010 when it won 5.7 per cent of the vote, passing the 4 per cent threshold for seats in the Swedish parliament. In the 2014 elections they cemented their position by winning 12.9 per cent of the votes.
According to a recent poll-of-polls, the Sweden Democrats currently have the support of 20.8 per cent of the electorate, slightly above the 20.5 percent for the centre-right Moderaterna and a bit less than the 25.2 per cent for the Social Democrats. What’s more, polls have tended to understate support for the Swedish Democrats.
It’s part of a trend away from social democratic parties across Europe. Where centre-left parties have managed to turn round their fortunes, it’s by modernising their policies. The Swedish social democrats have turned from socialism to more market-friendly policies in order to attract the middle class.
But their stance on immigration and identity policies have seen them lose swathes of working class votes to the Sweden Democrats. Indeed, if it had not been for a large influx of voters with an immigrant background, who account for almost all of Sweden’s population growth, the social democrats would be even more marginalised.
While the election is still some months away, the expected outcome is a boost for the anti-immigration party and confusion about who will be able to form a government. While the Swedish democrats will expect to emerge with a significant number of seats, they will still be well short of a parliamentary majority.
Two of the right-wing parties, including Moderaterna, are willing to co-operate with the Swedish Democrats, while two other parties are more likely to side with the Social Democrats – but that would be an uneasy alliance. Either way, Swedes can expect a fragile governing coalition that could quickly fall apart.
For what that might look like, we need only look back to 2014, when a parliamentary crisis saw the Swedish Democrats sided with the center-right coalition, forcing the governing Social Democrats to operate with a budget set by the opposition. A fresh set of elections was only averted when the centre-right parties backed off and offered the government their tacit support.
The big question ahead of September’s vote is whether the government that emerges will have the strength and willingness to deal with the overheated economy, the rise in crime and the underlying social tensions. As a leading knowledge economy, Sweden has many strengths — but its political leadership is not currently one of them.
Nima Sanandaji is the author of Scandinavian Unexceptionalism, Debunking Utopia: Exposing the Myth of Nordic Socialism and The Nordic Gender Equality Paradox.