Poll leaves Denmark’s leaders walking a political tightrope

Never expect gratitude from voters. Winston Churchill learned that bitter lesson when he lost the 1945 UK general election in a landslide, despite having inspired the West to victory over the Nazis. Now Danish Prime Minister Mette Frederiksen, one of the few world leaders to stand up to US President Donald Trump, has seen both her party and governing coalition go down to defeat — though she may yet return as prime minister in a new coalition. 

At a time when many European countries are struggling to cope with the challenge posed by populist and nationalist parties, Denmark under Frederiksen’s government appeared to be an exception. Following the 2022 election, a majority government was formed by unifying the political center. The two traditional rivals of Danish politics — the Social Democrats and the liberal “Venstre” (it actually means “left,” even though it is on the right) party — joined with the newly established Moderates, led by the former Prime Minister and Venstre breakaway Lars Lokke Rasmussen, to form a durable parliamentary majority. 

The government was unique in Danish political history. Denmark has a long tradition of minority governments. Indeed, previously, no Danish government comprising parties from both sides of the political aisle had ever completed a full term in peacetime. So Frederiksen’s achievement in this regard was remarkable. 

But as they say in the medical profession, the operation was successful, but the patient died. 

The experiment in a variant of what the French call cohabitation has now been rejected, despite broad agreement that the government delivered stability, increased defense spending to 3.5 percent of gross domestic product — without raising a single tax or cutting public spending elsewhere — and maintained Denmark’s role as one of Ukraine’s most reliable allies. 

Another achievement was the government’s steadfast handling of the profound rift with the US following Trump’s bullying over Greenland. And although the government was born out of a sense of crisis following Russia’s invasion of Ukraine, it has benefited from strong economic tailwinds, with booming growth supporting a near-historic expansion of fiscal space. 

The Danish parliament has never been more fragmented.

Thomas Bernt Henriksen

And yet, despite forging broad parliamentary consensus on defense, managing major foreign policy challenges, and overseeing buoyant economic conditions, voters have turned their backs on Frederiksen, Rasmussen, and Defense Minister Troels Lund Poulsen. They have shifted their support toward anti-immigration parties, particularly the Danish People’s Party on the right, as well as toward the Socialist People’s Party on the left. 

One possible reason for the government’s loss of support among voters was its 2023 decision to strengthen the public finances by abolishing Great Prayer Day as a public holiday. This seemingly minor decision, especially when compared to the Ukraine war and standing up to Trump, nevertheless triggered a major backlash, not least from trade unions. 

A striking feature of the election campaign was that issues such as animal welfare in pig production and the protection of clean drinking water overshadowed concerns about the current oil crisis or global security. Immigration also remains a strongly divisive issue and may evolve in the coming years into a broader debate about migrant workers, who currently account for around 10 percent of total employment. 

Another defining moment of the campaign was the debate over the Social Democrats’ proposal to introduce a wealth tax of 0.5 percent on fortunes above 25 million krone ($3.9 million). Frederiksen expected the proposal — intended to finance an ambitious reform to cap smaller schools’ class sizes at 14 pupils — to boost support. Instead, it triggered strong opposition from businesses and startups. The election results imply that Denmark will not introduce a wealth tax. 

Even so, with its strong economy and highly developed welfare state, Denmark might have been expected to avoid the political polarization and fragmentation seen elsewhere. But no party received more than 22 percent of the vote, and all 12 parties that stood in the election will be represented in parliament. The Danish parliament has never been more fragmented. 

Voters are increasingly aligned with issues rather than ideology.

Thomas Bernt Henriksen

While Frederiksen’s Social Democrats remains the largest party, the Liberal Party is now smaller than the Socialist People’s Party and is increasingly challenged by other right-leaning parties, such as the Liberal Alliance. This shift in party allegiance probably reflects Danish voters’ increasing alignment with issues rather than ideology. For some, the key concern is the plight of rural areas. For others, the salient issues are immigration, business conditions, climate policy, or animal welfare. As in many other countries, party membership has declined sharply over the past half-century, and parties have become heavily reliant on state funding. 

Whatever their causes, polarization and fragmentation threaten political stability, and place a growing burden on political parties’ ability to form stable and effective governments. This is the central challenge facing Frederiksen, who remains the most likely figure to become prime minister. The governance challenge is particularly complex for her. She is committed to maintaining a strong stance on immigration, while also positioning herself as a pan-European stateswoman with a tough-minded foreign policy and a willingness to embrace EU economic reform. On these issues, she is often closer to parties on the right than those on the left. 

The greatest risk Denmark faces may not be Trump or the Kremlin, but a return to 1970s-style instability, characterized by frequent elections —  roughly every two years — and weak economic performance. Fortunately, Denmark’s strong tradition of cooperation and broad parliamentary consensus on major issues provides some grounds for optimism that the country can manage its growing political fragmentation. 

Many of Frederiksen’s European colleagues will most likely welcome her remaining in office. Last year, Politico named her Europe’s second most powerful politician. But that may pose another risk to political stability: There is speculation that, like former Liberal Prime Minister Anders Fogh Rasmussen, who went on to become secretary-general of NATO, she could be appointed to a major international position in the not-too-distant future. 

• Thomas Bernt Henriksen is Chief Business Commentator at Berlingske and a former council director of the Council of Economists at the Conference Board.
Copyright: Project Syndicate