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Denmark went to the polls on Thursday, and it ended in a narrow left wing victory, ending 10 years of conservative government.

The result is not likely to fundamentally alter the country's very tight immigration policy, but the immigrant bashing seems to have left centre stage. Politics is back to being about the economy.

Social Democrat Helle Thorning Schmidt will be the next prime minister - and the first woman on the post - but she will have to govern on four parties spanning from the somewhat libertarian social liberals to the very left wing Unity list. This will be no easy task.

Just as significantly the election handed the first defeat to the far right Danish Peoples Party, and will also leave the party pretty marginalised.

First a little bit about the Danish political system.

All citizens are automatically registered to vote, and turnout is traditionally high. This time it went even higher than usual and ended at a whopping 87 percent.

The seats in parliament are distributed proportionally according to the nationwide vote among all parties getting over the 2 percent threshold. This has brougt no less than 8 parties into parliament - the same as last time - and coalition making and political compromises are a national art form.

On a general note it must also be said than with the exception of immigration policy the political centre is well to the left of America. The tax burden is the heaviest in the world (about 50%), and there is little questioning of public health care, subsidized daycare for kids, free universities etc. The government cutting back an early retirement scheme and shortening the unemployment benefit period from 4 to 2 years has been major issues though.

The outgoing government under Lars Løkke Rasmussen has been a coalition of his Venstre (a liberal party in the European sense of the word - tax-weary, business friendly and tightening social services) together with the conservatives. But the coalition has been a minority dependent on the far right Danish Peoples Party, which is very populist, also to some extent on economic issues. The party has pulled the debate on immigration very far to the right and into outright nastiness, especially on an anti-islamic rhetoric. On their initiative the current government has tightened immigration laws to the extreme, getting it hard to get foreign spouses into the country, even for citizens.

In the election Lars Løkke Rasmussen actually managed a small gain and kept the status as the largest party at 26.7 percent. But the coalition conservatives has positively imploded after several rounds of infighting, lost more than half of their votes, landing at their worst result since WWII - only 4,9 percent. And for the first time since it was born in the late 1995 the Danish Peoples Party has lost seats - and were not able to dominate the campaign.

Economy has. When the economic crisis hit in 2008 the economy had been roaring ahead for more than a decade. Unemployment was down to 1,4 percent, public budgets had had solid surpluses for years and the trade balance was flashing green. But this boom had also created wages running ahead of the neighboring countries and a housing bubble that the government had foolishly inflated by loosening lending regulations.

So the crisis has hit relatively hard and the country has not really been able to get back on the growth track like, even though neighboring Sweden and Germany have had decent bounce back booms. Public budgets are back in the red, and unemployment, though still low by international standards, has more than tripled. Both the housing and the labor market is very slow.

So in the end a narrow majority has chosen the opposition, but the internal shift of seats in the left wing bloc has been no less dramatic.

The social democrats, which will head the government, actually lost a bit and landed at their worst since the war too - 24,9 percent. As many of the old european labor parties it has continued its downward trend, as its traditional voter demographic is vanishing. Precincts like my own in one of the classic working class neighborhoods in central Copenhagen, would a few decades ago have delivered 60 % + results for the party, but now relegates it to third place and less than 20 %. Much of the remaining working class especially in the housing projects in the suburbs have also been veering off to the Danish Peoples Party, promting the social democrats to promise to largely leave the tight immigration party in place, killing the issue, but at the price of continuing a policy that is on the verge of breaking human rights and definatly far off any decency.

The likely coalition party to the left of them, the socialist peoples party, has tied itself closely to the social democrats, and this will bring them in government for the first time ever. But the tagging to the right has cost dearly in votes and the party took a drubbing by the voters.

So the coalition will be dependent on both the far left in the Unity List and the social liberals. Both parties have had a very good election, especially in the cities - for the Unity List far the best ever, and from election after election just making the 2 percent threshold, they have more than tripled.

The social liberals are actually economically quite right wing, but is to the left of the social democrats on social issues, including immigration, environment, education etc., and that has landed them firmly in the left wing camp. They might join the government, if a coalition agreement can be reached.

The new government will likely do part of the policy across the aisle, but on some issues they will be dependent on the far left in order to survive.

So amongst the four parties economically two are mainstream left wing economically, one is far left to the point of wanting nationalisations and one wants tax cuts in the top end bracket. On the other hand two want to loosen immigration policy, the leading party is terrified by the issue and won't touch it and one has just paid dearly at the ballot box for accepting this.

It will not be smooth sailing...

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