Sweden: Goodbye to All That

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For the Social Democrats, architects of Sweden's cradle-to-grave welfare system, it was the worst trouncing at the polls since 1928. All told, they won only 138 seats in the 349-member Riksdag, or Parliament, and just 38% of the popular vote. Behind their defeat was widespread discontent over the high cost of social benefits. Pensions and health and other programs are generous, but the top tax rate of about 70% is the highest in the Western world.

Prime Minister Ingvar Carlsson resigned immediately and is likely to be succeeded by Moderate Party leader Carl Bildt, 42, who hopes to form a government soon. That will not be easy. By failing to deliver an absolute majority to Bildt's coalition, voters ensured that their country's vaunted politics of cooperation would be sorely tested. Bildt will need at least the tacit support of the new right-wing protest party, New Democracy, which won 25 seats by advocating curbs on immigration and cuts in foreign aid -- policies that are anathema to the rest of the nonsocialist bloc and to the socialists as well. Even then, he will face the daunting task of cutting taxes and government spending while not obliging his countrymen to give up too many of their customary benefits too soon.