Signal: Sweden in Pieces – Tiger Politics – Who Curates Corruption?

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SWEDEN IN PIECES

In Sweden’s national elections over the weekend, the anti-EU, anti-immigrant Sweden Democrats continued their political rise, while the main center-left and center-right blocs suffered. Full tallies are here, but here are three quick thoughts on what this election tells us about the shifting political winds in Europe.  

Right wing populism can thrive even where the economy is strong.

Explanations for the rise of populist, anti-establishment politics often look at income inequality, slow economic growth, or weak social safety nets. Sweden has none of those problems. The economy is growing faster than the EU average, and its society is among the most equal in Europe. Unemployment is low, the government runs a budget surplus, and social services are expansive. So what’s going on? Well, the government’s generosity is, in fact, precisely the reason for the backlash against foreigners. When the government does so much for a society, the question of who gets to belong to that society can become controversial very easily.

In recent years, Sweden has accepted more migrants per capita than just about any other EU country (see graphic below). And because Swedish policies give huge benefits to migrants while also (because of strong unions) making it difficult for them to find jobs, the Sweden Democrats have ably made the case to many voters that refugees are scarfing down a disproportionate share of the country’s generous social benefits without integrating or paying their way.

Sweden’s experience points to an uncomfortable question that voices on the right are posing in some of Europe’s most prosperous democracies: can a generous welfare state continue to coexist with liberal immigration policies?

But Sweden's election is about something more than immigration.

The leading losers in this election were the top establishment parties. Yes, the governing center-left Social Democrats came in first, but they rang up their worst performance in more than 100 years, costing them 12 spots in the 349-seat legislature. The center-right Moderates who lead the opposition, meanwhile, lost 14 seats.

But while the anti-immigration Sweden Democrats picked up 13 seats, an increase of 16 seats went to the socialist-leaning Left Party (+7 seats) and the centrist Centre Party (+9), neither of which campaigned against immigrants. Both actually proposed better ways to integrate immigrants.

So while the rise of the anti-immigrant, euroskeptic far-right is one story, Sweden’s election falls into a broader narrative that we’ve seen in elections in France, Germany, and Italy—as well as further afield in Mexico and Pakistan—in the past 18 months: leading establishment parties and traditional party blocs are fading fast.

There are no good options to form a government.

As of this writing, the three party center-left bloc (led by the Social Democrats) has a razor-thin margin over the center-right bloc of four parties, led by the Moderates. Both blocs are far short of a majority, and overseas vote tallies could affect the final count. It will probably take weeks to form a government, as neither of the two main blocs wants to work with the Sweden Democrats, but they will also have a hard time burying decades-old disagreements. While it’s nearly impossible to imagine the center-left working with Sweden Democrats, a more interesting choice awaits the center-right Moderates. Party leader Ulf Kristersson says he won’t reach out to them. But will he change his mind if inviting that party to join his bloc is the only way he can form a government?

The bottom-line: These results are more a rejection of the establishment than a clear call for new immigration restrictions. Yes, the Sweden Democrats gained 13 seats, but three small parties with a very different attitude toward migrants gained a total of 23 seats. The fragmentation of Sweden’s politics is a bigger story than any lunge to the far-right.

GRAPHIC: ABSORBING THE MIGRANT WAVE

During the height of the European migrant crisis in 2015 and 2016, more than a million asylum seekers, refugees, and economic migrants from North Africa, Syria, and South Asia sought shelter in Europe. Their arrival has changed politics in Europe, giving rise to anti-migrant backlashes in a number of countries. Here is a map that shows the recent increase in migrants as a percentage of the population in the 28 countries of the European Union. 

READING BETWEEN THE STRIPES: INDIA EDITION

Over the past two years, a wild tigress has stalked and killed more than a dozen people near a village in central India. The New York Times has a superb story about it, which you can (and should) read here: it’s got gruesome maulings, orphaned cubs, altruistic suicide-seekers, and heavily armed elephant rides. But it’s also a subtle portrait of many of the political and social challenges that India faces today. Here’s a brief look behind some of the story’s best lines.

“India’s Hindu nationalist governing party, the B.J.P., has cracked down... on the slaughter of cows, an animal Hindus revere. This has created enormous herds of mangy, unproductive, unwanted cattle that herders don’t dare to kill, either because of specific cow protection laws that vary state by state or because they are terrified of being lynched by Hindu extremists.”

The BJP, led by current Prime Minister Narendra Modi, swept to power in 2014 on an assertively Hindu nationalist platform. As it happens, the powerful traditionalist organizations that support the BJP demand better protection of cows – which enjoy nearly god-like status among devout Hindus. As a result, the BJP – which controls more than half of India’s states in additional to the national government – has sought to expand cow protection laws significantly over the past several years. At the same time, Hindu “cow vigilantes,” some of which reportedly have links to the BJP, have killed dozens of (mostly Muslim) cattle herders, and extorted many more.

The result is: lots more cows around, which milk farmers can’t support but are scared to kill. From the tigers’ perspective this is a massive enticement to come out of the forest for a bite – and into closer contact with humans. The problem reflects the larger story of escalating sectarian tensions as the world’s largest democracy heads for national elections in 2019. Modi wants to keep the traditionalists on side, and the cow issue is a winner with that base.

“Many tigers are now running out of space… all across India, islands of forest are shrinking”

This is also a story about India’s growing urbanization and dwindling natural space. While conservation efforts have caused the tiger population to rebound over the past decade, their natural habitats – several dozen tiger reserves and related forest corridors – have either failed to grow apace or have actually been reduced by massive new infrastructure and construction projects. Since coming to power, the BJP has sought to loosen some of India’s extensive environmental regulations in order to boost investment and growth, while also giving the green light to several infrastructure projects that directly threaten tiger habitats. The government says economic growth is the priority, as you might expect in a country that needs to create a million new jobs every month just to keep pace with a swelling population.

“‘If I die, will you give my family the money?’”

The government has offered up to $14,000 to the families of the victims of tiger attacks. For perspective on just what that means, that’s about seven times per-capita GDP. Over 20 percent of Indians still live on less than $1.90 a day. Rural wages have actually declined over the last two years. So while India has made extraordinary strides in poverty reduction in recent decades, with more than 270 million poor (most of them in rural areas), there is still a reason that the elderly man quoted above was found milling about a tiger bait station, hoping to get mauled.

GZERO WORLD WITH IAN BREMMER: TURKEY, TRUMP, FACTS, FICTIONS

In this week’s GZERO World, Ian explains why the nosedive in US-Turkey relations isn’t good for either country, and sits down with The New Yorker's Adam Davidson to discuss where Trump’s money trails may lead. In Puppet Regime, Trump goes to Moscow for some hacking help.

THE ENABLERS: DIRTY MONEY IN “CLEAN” COUNTRIES

If money is laundered in a forest and no one is around to see it, is it still a crime? Yes, of course, it is. But more than that, you can’t launder money in a forest, or anywhere else, without banks or other financial institutions willing to overlook the putrid provenance of dirty money. And according to a new EU report seen by the Financial Times, a number of those banks are located within the European Union.

Recent big time scandals in Europe include, for example: the Latvian bank that bankrolled the North Korean nuclear program; the $8.3 billion in allegedly suspicious money from the former Soviet Union that flowed through the tiny Estonian branch of Danske Bank in a single year; and the $10 billion in Russian cash that Deutsche Bank laundered via “mirror trades” (which earned the firm a fine of $640 million).

And of course it will surprise precisely no one to hear that over the past 10 years the London property market has soared to dizzying highs on cash infusions from corrupt leaders and business people with ties to the Middle East, Africa, and Russia. Earlier this year, British lawmakers launched an investigation into the matter, though chiefly in the context of growing tensions with Russia after the poisoning of a former KGB officer in the UK.

In fairness, Europe has particular challenges when it comes to stamping out dirty money. As the EU report seen by the FT points out, oversight bodies are understaffed, and regulation is decentralized. In a common economic bloc of 28 countries where regulatory supervision and enforcement varies, the EU’s ability to tackle illicit money flows is only as good as the convictions of its weakest members. The Baltics and the Balkans stand out as particularly porous entry points for dirty money, but a report last year found that in two-thirds of EU countries firms are too lax in flagging suspicious cash. There have been calls for a centralized authority to not only assess how banks run, but also what they run. A single clearing house for oversight, information-sharing, and enforcement would obviously be a good step.

Until then, here’s something to bear in mind: When we write about corruption, we often look chiefly at the countries where kickbacks and graft are a way of life. We cite the well-known Transparency International rankings that tell us that corruption is rife across much of Africa, the former Soviet Union, Latin America, and Asia – and that Russia and Mexico are the two most corrupt of the world’s large economies. We rightly criticize leaders who enable, encourage, and thrive in these systems. And we write about how graft shapes voters and elections around the world.

But the point is that corruption thrives in “dirty” countries in no small measure because of financial institutions and banks in “clean” countries that are willing to play ball. It’s good to shed light on corrupt actors, but the enablers of corruption are often closer to home than you might think. 

HARD NUMBERS

30,000: More than 30,000 Syrians have fled their homes in the northwestern province of Idlib since a government military offensive began there last week, according to the UN. A UN official said fighting in Idlib could provoke the worst humanitarian catastrophe of the 21st century.

34: Traffic delays cost Los Angeles and New York around $19 billion and $34 billion, respectively, in 2017. The two US cities were among top 5 most congested in the world last year, joined by Moscow, Sao Paulo, and San Francisco, according to a new report from INRIX.

20: Around 20 percent of arrests in China in 2017 took place in the western province of Xinjiang – where the country’s large Muslim Uighur population is concentrated – despite the province only accounting for about 1.5 percent of China's population. That doesn’t include an estimated 700,000 to 1 million Uighurs who’ve been detained in government “re-education” camps.

5: Support for far-right Brazilian presidential candidate Jair Bolsonaro has jumped by 5 points to 26 percent since he was stabbed during a campaign rally last week. Bolsonaro, who lost 40 percent of his blood as a result of the attack, is in stable condition after undergoing medical treatment.

0: In contrast to previous years, North Korea displayed no inter-continental ballistic missiles in the massive military parade to celebrate the anniversary of the country’s founding, which took place over the weekend. Instead of flexing its military might, the Kim regime touted progress in economic development and improving living standards.

SOUNDTRACK: This edition of Signal written while listening to Living Colour’s “Cult of Personality.” A thirty-year old song, written about political figures from decades earlier that's suddenly topical again. Come for the lyrics about truth-bending demagogues, stay for the otherworldly guitar solo by Vernon Reid, the “Jackson Pollack” of guitarists…