July, 2011

by Manuel Alvarez-Rivera, Puerto Rico

Despite increasing its overall share of the vote in a general election held yesterday, the four-party, center-right coalition government of Swedish Prime Minister Fredrik Reinfeldt has apparently lost the narrow parliamentary majority it held since 2006 in the Nordic country’s unicameral Parliament, the Riksdag. The ruling Alliance for Sweden – comprised of Reinfeldt’s Moderate Party, the Center Party, the Liberal Party and the Christian Democratic Party – scored a clear victory over the “Red-Green” alliance of the left-of-center Social Democratic Party, the ex-communist Left Party and the environmentalist Green Party, but the far-right Sweden Democrats almost doubled their share of the vote and secured parliamentary representation for the first time ever, depriving the government of an overall majority in the process.

Nonetheless, the workings of Sweden’s proportional representation electoral system – reviewed in Elections to the Swedish Riksdag (which has preliminary 2010 election results) – also played a role in pushing the ruling parties further away from an overall majority. Specifically, in the first stage of Sweden’s two-tier mechanism for distributing mandates in the 349-seat Riksdag – since 1994 elected every four years – 310 permanent seats were allocated in twenty-nine multi-member constituencies among the eight parties that polled at least four percent of the nationwide vote, with the following results:

Social Democratic Party (S) – 113
Moderate Party (M) – 107
Green Party (MP) – 18
Liberal Party (FP) – 17
Center Party (C) – 21
Sweden Democrats (SD) – 14
Christian Democratic Party (KD) – 11
Left Party (V) – 9

Now, while multi-member constituency seats are distributed by proportional representation (using the adjusted odd-number method, also known as the modified Sainte-Laguë procedure), the allocation of seats on a constituency-by-constituency basis introduces significant disparities between the distribution of votes and seats. Thus, the Social Democrats were noticeably over-represented, winning 36.5% of the constituency seats with 30.9% of the vote, while the Left Party, with 5.6% of the vote, came up distinctly under-represented with just 2.9% of the seats.

Nevertheless, the Riksdag also has 39 adjustment seats, whose purpose is to bring about a proportional allocation of parliamentary mandates. To apportion these seats, all 349 Riksdag mandates were distributed on a nationwide basis by the adjusted odd-number method among parties polling at least four percent of the vote, with the following results:

S – 109
M – 106
MP – 26
FP – 25
C – 23
SD – 20
KD – 20
V – 20

The nationwide distribution of Riksdag seats would have left the Alliance of Sweden parties with a total of 174 mandates, or one seat short of an overall majority. However, both the Social Democrats and the Moderates won more constituency seats than the total number of mandates they were entitled to receive at the national level. Both parties kept the extra seats, but their constituency seats were subtracted from the total number of Riksdag seats, leaving 129 seats to be apportioned among the other six qualifying parties. Consequently, the allocation of Riksdag mandates changed as follows:

S – 113
M – 107
MP – 25
FP – 24
C – 22
SD – 20
KD – 19
V – 19

Because the Social Democratic Party won four mandates above the total it needed to be proportionally represented in the Riksdag, the ruling coalition’s seat total was further reduced to 172 – three seats short of an absolute majority. In fact, while the Social Democrats scored a very disappointing result – the party’s share of the vote fell to its lowest level since 1914 – they nonetheless had a somewhat stronger-than-expected performance and (contradicting most opinion polls) remained Sweden’s largest party, albeit just barely ahead of the Moderates, who had their best result since 1914.

Interestingly, the election outcome leaves Reinfeldt’s government in a situation very similar to that faced by Sweden’s previous 1991-94 center-right cabinet, headed by then-Prime Minister (and currently Foreign Minister) Carl Bildt. At the time, the four right-of-center parties held 170 seats – five short of an overall majority – and the right-wing, populist New Democracy (NyD) effectively held the balance of power with twenty-five seats; Bildt’s government lasted out its entire three-year term in office with NyD’s tacit backing. That said, at this juncture the Alliance for Sweden parties (or for that matter the opposition “Red-Green” parties) won’t have anything to do with the anti-immigration, anti-Islam Sweden Democrats; instead, Reinfeldt’s government is attempting to win over the Green Party, which polled its best Riksdag election result ever. However, the Greens don’t appear to be interested so far in backing Reinfeldt, who nonetheless will remain in office unless he chooses to step down or the Riksdag brings down his government in a vote of no-confidence.

There’s also the possibility that the ruling Alliance for Sweden could secure a narrow Riksdag majority once votes cast by Swedish expatriates or electors voting outside their places of residence are tallied later this week. A comparison of election night and definitive figures for the past three general elections shows small percentage increases for the center-right parties in the final tallies, but this year’s election outcome has been skewed by the four extra seats won by the Social Democratic Party at the constituency level, and a slight shift in the nationwide vote totals is less likely to change the distribution of Riksdag seats. As things stand right now, the center-right parties would win a one-seat majority if they captured three constituency seats narrowly won by the Social Democrats in Kronoberg County, in the Municipality of Göteborg and in Värmland County, respectively (over the Moderates in the first case and the Liberals in the latter two).

At any rate, the continuing decline of the Social Democrats – who have ruled Sweden for all but thirteen of the past seventy-eight years – has led to much speculation about the end of an era of Social Democratic dominance. That could possibly be the case, and the party may eventually go the way of its Danish counterpart, which lost its political dominance at the beginning of this century and has yet to recover it. All the same, it should be remembered that following a disastrous result in 2001, the Labour Party in neighboring Norway bounced back in 2005, and has remained in power since then. From that perspective, only time will tell if the Social Democratic Party will continue to lose ground or reverse its declining electoral fortunes.

This article is from the RIIB blog of July 13, 2009.

The debate over health care reform in the United States is on and Canada is featuring prominently in it. From the US right come ads detailing claimed shortcomings of Canada’s health care system. From the Great White North comes the “Jack Layton Goes to Washington” show, with Layton and company seeking to debunk “myths” perpetrated by the right. Certain facts are not in dispute. Approximately 46 million Americans have no health insurance and health care expenditures are more than 16 percent of US GDP. In Canada all are insured and health care expenditures amount to only about 10.5 percent of GDP. In Jack Layton’s words, “The Canadian system produces better health outcomes, reaches everybody and is less expensive to operate than the U.S. system”.

Whether 16 percent of GDP is too much to spend on health care or 10.5 percent too little is open for debate. The fact that 46 million Americans are uninsured does seem to be a problem. Focussing narrowly on these issues, however, misses the real problem facing the US health care system, and the real reason reform is needed. Contrary to popular belief in Canada, the US does not have a fully private health care system. About 50 percent of health care payments there come from public sources. The Medicare and Medicaid programs in the US account for most of these payments. Unless the government gets health care costs under control, Medicare threatens to bankrupt the US. Estimates for Medicare’s unfunded liability – the additional tax revenue required today to cover future Medicare expenditures – range as high as $ 90 trillion. To cover this liability the US government would need either massive spending cuts or huge tax increases. As a practical matter, the unfunded liability is so large that neither one is realistic. The only real route open to the US is health reform that reduces the cost of health care.

As we give advice on health care reform to our neighbour to the South, we in Canada should not be smug about our own health care system. A recent study by Peter Dungan and Steve Murphy from RIIB’s Policy and Economic Analysis Program indicates that Canada too is facing large future health care costs (An executive summary for the study can be found on the RIIB web page.). Dungan and Murphy construct population and demographic profile estimates for Canada out to the next century. They match these estimates with the 2006 National Health Expenditure Trends from the Canadian Institute for Health Information (www.cihi.ca) that gives health care expenditures in 2006 by age group and by sex. This allows Dungan and Murphy to estimate what expenditures on health care would be today if the population demographics were those of 2025, say.

Looking only at provincial health care expenditures, which account for about 65 percent of total expenditures in Canada, they find that, were the 2025 demographics in place today, expenditures would be almost 20 percent higher, coming in at $ 115 billion. With the demographics of 2050, provincial health care expenditures would be over 40 percent higher ($ 137 billion or 9 percent of GDP). These estimates are likely on the conservative side. The CIHI report estimates that real expenditures on health care by the provinces will have increased by an estimated $ 7 billion, or by about 10 percent, by 2008. Should anything like this trend continue into the future, real provincial expenditures on health care will be significantly higher than the Dungan and Murphy estimates.

Much of the increase in health care expenditures projected by Dungan and Murphy comes from the aging of the population. In 2006 approximately 13 percent of the population is aged 65 and over. Dungan and Murphy estimate that, by 2025, 20 percent of the population will be over 65. It is well known that health care expenditures fall disproportionately in the later years of life. This aging of the population also means that, at the same time as health costs are going up, the group of working age individuals who would pay these costs is shrinking. This combination of rising costs and shrinking tax base is a serious problem. The system we have now, with doctor shortages, crowded emergency rooms and wait lists for care, is barely affordable. What will we face 15 years from now?

The long and the short of it is that the problem that Medicare faces in the US is a problem confronting Canada as well. Canada cannot afford to be complacent. Health care reform is not just a US problem!