Karl-August Fagerholm - 1948 Elections and Fagerholm As PM

1948 Elections and Fagerholm As PM

When new parliament elections were held in July 1948, the Communists suffered a sharp drop in support, falling from fifty-one to thirty-eight seats. Communists had demanded the posts of prime minister and either ministry for foreign affairs or internal affairs and as the result were not included in the new minority cabinet led by Fagerholm (there was no communist participation in Finland's government again until 1966). Fagerholm's minority government mostly relied on support by deputies of the Conservative and Liberal parties plus the conservative wing of the Agrarian League. In social policy, Fagerholm’s government was notable for passing a public pension law.

As leader of the Social Democrats, he was prime minister from 1948 to 1950, despite fierce Communist opposition and accusations by the Soviet Union that he intended to undermine the Finnish-Soviet YYA Treaty by taking Finland into NATO. Even Finland's growing integration into the world economy, as demonstrated by its joining the General Agreement on Tariffs and Trade (GATT) in 1949, was viewed with similar suspicion. It did, however, serve Soviet interests in as much as it contributed to Finland's ability to meet the harsh war reparations requirements of the 1947 Paris Peace Treaty.

Opposition from the domestic Communists (under Soviet guidance) exemplified by communist strike agitators who in 1949 tried to take over the dockworker's union and indirectly threatened the stability of the government of Karl-August Fagerholm.