1950s
The war and the post-war times of economic hardship had motivated government control of prices and wages attempting to hamper inflation. One of the themes in the elections and one of the important objectives for Fagerholm's government was to transfer the handling of incomes policy to negotiations between the unions and employers' organizations. In January 1950, the Parliament agreed to increase wages and end wage controls.
Soon after this a minority cabinet under Kekkonen assumed power. Wage negotiations ended in an impasse in the spring. A warning of general strike was issued, in order to speed up the negotiations. In this tense situation, Fagerholm, now Speaker of Parliament, brokered a solution which was supported in ballot by a clear majority of trade union members.
Fagerholm's relation to the aged Finnish president Paasikivi remained controversial, although the release of the latter's diary has thrown some light on the issue. Supporters of Fagerholm argue that Fagerholm's line in foreign politics was considerably closer to that of Paasikivi, but Fagerholm, in many aspects, was ideologically remote from the Conservative fennoman Paasikivi. Supporters of Kekkonen argue that Fagerholm's contact with the United States embassy, and pecuniary support from the US, could not have been approved by Paasikivi. Although Paasikivi considered both contenders for the position as Prime Minister as skilful and politically capable, he did in fact come down more often in favor of Kekkonen, who enjoyed the support of the Soviet leadership.
In the presidential elections of 1956 Fagerholm would have one if one elector jad voted otherwise; he got 149 votes to Urho Kekkonen's 151. Fagerholm instead succeeded Kekkonen as Prime Minister for a four-party coalition cabinet.
Read more about this topic: Karl-August Fagerholm