SWEDEN'S 9/17 ELECTION: ALTERNATIVE OUTCOMES

C O N F I D E N T I A L SECTION 01 OF 02 STOCKHOLM 001421 SIPDIS SIPDIS E.O. 12958: DECL: 09/06/2016 TAGS: PGOV PREL SW SUBJECT: SWEDEN'S 9/17 ELECTION: ALTERNATIVE OUTCOMES REF: A. STOCKHOLM 913 ¶B. STOCKHOLM 952 Classified By: Polcouns Casey Christensen, reason 1.4 (b) and (d). Summary -------------- ¶1. (c) Sweden's 9/17 parliamentary election remains a neck-and-neck race (ref A),too close to call. All seven parties currently in parliament appear likely to reach the 4 percent threshold; no newcomers are likely to qualify. This means that the most likely outcomes are either a return of Prime Minister Goran Persson's Social Democrat-led government, supported by the Green and Left parties, or a government of the center-right "Alliance for Sweden" made up of the Moderate, Liberal, Christian Democrat, and Center parties, with Moderate leader Fredrik Reinfeldt as Prime Minister. In terms of foreign policy, another Persson government is likely to continue on current policy tracks. A shift to a somewhat less Euro-Atlantic-friendly orientation is possible (but not likely),and only if the Greens do particularly well and have the power to make good on their demand for ministerial posts in a Persson government. For its part, a Reinfeldt government may be more open to eventually considering a closer relationship with NATO, but this is not on the screen as a policy priority (ref b). Domestically, Reinfeldt would focus more on job creation and seek income tax reductions, particularly in the lower income brackets, but would not seek major restructuring of the Swedish welfare state model. End Summary. And the Winner is..."Undecideds" -------------- ¶2. (u) Coming into the last 10 days of the campaign, this is the tightest election Sweden has seen since 1979. The opposition "Alliance for Sweden" has led virtually all polls since the end of June, and for most of the past two years, although the size of the leads have varied from fractions of a percent to a few percentage points. However the most recent poll by the Sifo polling institute published on 9/6 gave the governing SDP and its support parties a 0.7% lead. ¶3. (c) With the SDP having governed 65 of the past 74 years, the opposition is encouraged to be running even. Key factors contributing to the opposition,s relative strength include their success in creating a united front (the Alliance for Sweden),and the Moderate's effective rebranding as a worker-friendly party, which has made it much more difficult 
for the SDP to turn the campaign into a traditional "workers versus capitalists" debate. Additionally the central question of unemployment has for the first time favored the opposition, with a majority of Swedes having greater trust in Moderate Party leader Reinfeldt on the labor market issue than in Prime Minister Persson. Disenchantment with the self-serving ways of the long-entrenched SDP has also benefited the opposition. Many voters are tired of the autocratic style of Prime Minister Persson, who has been in office for 10 years. Add in a number of minor political scandals on the SDP side, and even Sweden,s traditionally pro-SDP electorate has become wobbly. ¶4. (u) With significantly more undecided voters at this stage than there were in recent elections, the outcome if far from certain. Opinion polls indicate that none of the seven parliamentary parties are likely to fall below the 4 percent threshold required to win seats in parliament, with the result that the most likely outcomes are that one of the existing blocks, the SDP-led government (with Green and Left support) or the Alliance for Sweden, will win the elections. Small Parties on the Fringes -------------- ¶5. (sbu) We do not expect any of the small parties not currently in parliament to pass the 4 percent threshold. The most significant of the small parties is the right-wing and nationalistic Sweden Democrats, who focus on restricting immigration. They were the largest party outside parliament in the 2002 election, garnering 1.4 percent of the votes. Most recent opinion polls have given them 1-2 percent, but one poll published on 9/5 put their support at 2.9 percent. Local pollsters tell us that opinion polls generally underestimate support for the Sweden Democrats, because people are reluctant to admit they will vote for them. For the first time, the Sweden Democrats will be widely distributing campaign material, canvassing nearly all of Sweden's voters with campaign material and election ballots (making it easier to vote for them on election day). In the unexpected event that they actually enter parliament, they could hold the balance of power between the socialist and non-socialist blocks. ¶6. (sbu) The EU-skeptical June List ticket has never got traction. The Feminist Initiative, which recently enlisted STOCKHOLM 00001421 002 OF 002 Jane Fonda to support its campaign, has been registering less than one percent in recent polls. Wild Cards -------------- ¶7. (c) Political scandals are usually pretty mild in Sweden, but they can, particularly at late stages of the campaign, affect the election's outcome. The current scandal involves some prominent Liberal Party (the second-largest party in the Alliance for Sweden) officials who were caught after having hacked the SDP's internal files via the internet. The SDP waited until near the end of the campaign to pounce on this, which has been going on for long months, and the effects are certainly damaging to the Liberals, but not as much to the Alliance for Sweden. Most guesses are that most disillusioned Liberal votes will go to Moderates. Nonetheless, the scandal is a net negative for the Alliance. The SDP has been tainted with numerous earlier minor scandals, including one involving the use of the internet by high-level party insiders to spread false rumors. Foreign Policy Implications -------------- ¶8. (c) The Government in Sweden takes all major decisions collectively, that is to say each minister has a say on a big decision, even if it does not fall in his or her porfolio. Therefore, having a Green or Left party minister could make a big difference in foreign policy. The Greens and the Left are both Euro and Euro-Atlantic skeptic. The Left and especially Greens are demanding ministerial posts if the SDP forms a new government, but are unlikely to get them. For the Left (former Communist) party, voter support is limited, and they are more focused on staying above the 4 percent threshold. The Greens have been more adamant, but would likely have to settle for second and third-tier positions in ministeries in another Persson-led government. ¶9. (c) For its part, a Reinfeldt government may be more open to eventually considering a closer relationship with NATO, but this is not on the screen as a policy priority. Domestically, Reinfeldt would focus more on job creation and seek income tax reductions, particularly in the lower income brackets, but would not seek major restructuring of the Swedish welfare state model. WOOD