Elections gathered in Norway: the problems that give the headaches to voters and officials in “the country that has become too rich”

Public expenses, but also inflation, taxes and quality of public services were key themes in the election campaign before the parliamentary elections on Monday, write Reuters, Associated Press and Financial Times.

Norway votes on Monday in a parliamentary election dominated by the concerns of citizens on increasing living costs and turbulence in international politics.

A left block consisting of the Labor Party and four smaller parties can win 88 seats in Parliament, three more than the minimum needed to get the majority, although decreasing from the 100 combined places in 2021, according to a recent opinion polls, writes Reuters.

On the right side of the political spectrum, the progressive (populist) party, the conservatives and two smaller groups seem to win the remaining 81 seats, but the race remains in the margin of error and could depend on the results obtained by some of the smallest parties.

Inflation, taxes and quality of public services were key themes in the campaign, and the result could have an impact on the oil and gas industry and the energy supply of Europe, as well as the management of the Norway's sovereign investment fund, worth 2 trillion dollars.

But the wars of Ukraine and Gaza, as well as the return of Donald Trump to the White House, also had an important share in the campaign, and the analysts said that this could be to the advantage of Prime Minister Jonas Gahr Stoere, a former foreign minister who presents himself as a trusted person.

The final official results are expected on Tuesday and will probably be followed by weeks of negotiations for the formation of a coalition and establishing the composition of the cabinet, before King Harald can invest a new government.

The coalition “Tutti Frutti”, favorite

At least nine political parties can obtain places in the elections that end at 21.00 local time (22. Romania time), but only the leaders of the Labor Party, the Progressive Party and the Conservative Party have candidates for the position of prime minister.

Stoere governs from 2021 with the support of the agricultural party and the socialist left, but the polls show that it may have to rely on the Communist and Green Party, in a combination that some analysts called the coalition “Tutti Frutti”.

The demands of green and communists could include more severe restrictions on oil and gas exploration, higher taxes for rich and high incomes, as well as higher expenses from the sovereign investment fund of Norway, the largest in the world.

The Labor Party would earn about 27% of the votes, according to the average of the polls this month, which would make it the largest party.

In the right-wing camp, the former Prime Minister Erna Solberg, from the Conservative Party, hopes to return to power with promises of significant tax reductions for households, as well as a reduction in wealth tax, which, according to companies, discourages investments, according to Associated Press.

The Labor Party wants to maintain this tax on wealth, which has been a pillar of Norwegian politics since 1892 – a tax of up to 1.1% applied to assets and shares with a value of over 1.76 million crowns (approximately $ 176,000), although there are various discounts and exemptions.

As in other Western countries, voters are getting more and more right to right -wing options. Sylvi Listhaug's anti-immigration progress party-which some have said is inspired by the US Maga camp-has about 21% of votes, long before the Conservatives, which have 14%.

Solberg and Listhaug have open disagreements about who should be the next prime minister in the event of a victory, which makes some voters hesitate to support one of the two.

“The country that has become too rich”

Norway is one of the richest countries in the world. It has a generous social state, has billions of oil and gas barrels and has one of the largest sovereign funds in the world, worth about 20 trillion wreaths (2 trillion).

The gross domestic product per capita is the sixth largest in the world, a place above the US, according to the International Monetary Fund.

Theoretically, all of these are good things for Norwegians, but economist Martin Bech Holte also highlighted the medal's reverse, in a book entitled “The country that became too rich,” writes Financial Times.

Sylvi Listhaug, the leader of the Progress Party, also attacked this theme, claiming that Norway “throws money in problems” and concluding: “There is something wrong with the way we lead Norway Inc.”

“We are a country that spends huge amounts of money, we have one of the highest levels of taxation in the OECD. However, Norwegians do not benefit from services better than those in Denmark, Sweden or Finland,” she added.

While the statements are some electoral, writes Financial Times, analysts and business people say that criticism is justified in terms of schools that are behind poorer countries, such as Estonia, and the health system that, although not in crisis, has its problems.

“The book has reached a sensitive point and is something that resonates with people. They think it is something true in it: there is too much bureaucracy, we do not solve problems effectively, there are public infrastructure projects that have far surpassed the budget,” said Johannes Bergh, political research director at the Norwegian Social Research Institute, quoted by the financial daily.

Among the cited infrastructure projects: a tunnel for ships with a length of 1,700 meters, which could cost $ 700 million, a partial renovation of the Oslo Parliament, which exceeded the budget six times, and over 400 million dollars spent on a defective IT platform for a regional health service.

“There is always the danger of becoming too relaxed and believing that the background will save us”

Economists say that Norway has avoided the “Dutch disease”, a phenomenon in which a certain economic sector (in the case of Norway – hydrocrackers extraction) grows spectacularly and undermines the rest of the economy.

But some are afraid that the country develops a “Norwegian disease” by using an increasing piece of background every year.

This amount – which reached 542 billion Norwegian crowns ($ 54 billion) this year – represents about a quarter of the government budget. This year, she helped Norway to increase contributions to Ukraine without having to reduce expenses in other fields or increase taxes.

Disease and invalidity expenses are the largest in the group of rich OECD countries and four times higher than the average.

School dropout rates in high school are far above the European average. At the same time, the increase of productivity has slowed down, which worries the decision makers.

Jens Stoltenberg, the former head of NATO, who revived the fate of the Labor Party in power by returning to the position of finance minister in February, said that, until now, Norway has faced the situation due to the high labor participation rate.

Now, other countries, such as Sweden and the Netherlands, have surpassed Norway, while productivity has stagnated, which represents “a great challenge and real concern,” Stoltenberg said.

“There is always the danger of becoming too relaxed and believing that the fund will save us. This is not the case,” he added.

Erna Solberg, the conservative leader who is in competition with Listhaug for the position of prime minister if the center-right opposition will win the elections, she also claimed that Norway is in better form than other European countries, but that she is facing the same challenges in competitiveness.

“The feeling of emergency is less accentuated in Norway, because we can use income from the sovereign fund to cover the difference,” she added.