Ideology, Welfare and Social Cohesion

Presentation by Peter Gustavsson, Uppsala Party Dictrict of the Swedish Social Democratic Labour Party

(SAP).

Democratic Party Youth, Serbia, December 9-10 2005

To Compare Social Models

• A social model is a result of certain values applied to a certain context. What works in one place won’t necessarily work in another place.

• The Swedish Model is Social Democratic values of liberty, equality and solidarity applied to Swedish preconditions. It’s in constant change.

Sweden 100 Years Ago

• 5,1 million citizens (today 9 million)

• Infant mortality rate 100/1000 (7/1000)

• Average age: men 53, women 58 (74/80)

• Average working hours a week: 75 (38)

• Average income/hour: 0,45 SEK (115)

• Price of pork/kg: 1 SEK (75)

Sweden 100 Years Ago

• Number of doctors: 1 131 (today 20 000)

• Number of hospital beds: 16 000 (120 000)

• The employers also owned the houses people lived in, and the stores you shopped in

• Blacklisting, starvation and lousy living conditions

When We Started

• Sweden was one of the poorest countries in Europe

• Starvation and poverty• Bad living conditions• Blacklisting and harrassment by police/military• Strong patronage system• Factory owners and land owners who also had the

political power ( no democracy)

The Background and Founding

• 1889 the Social Democratic Labour Party was founded by trade unions – mostly labour issues in the beginning

• To be able to concentrate on the political work, the party formed and founded LO, the trade union congress, 1898

• Ever since then, there has been a very close cooperation between LO and the party

The Background and Founding• 1932 election was a big land slide for the Social

Democrats• Social Democrats has been governing 1932-76, 82-91

and 94- (next election is 2006)• Reform policy and governing has been made possible

because of cooperation with and support and criticism from the trade unions

• Ever since then, the main issue for the party has been to win elections, and implement our political agenda.

How Long Time Did It Take?

• Organising/struggle for democracy, 29 years (1889-1918)

• Fighting to win power, 14 years (1918-1932)

• Reformation of society/creating a welfare state, 30 years (1945-1975)

• Financial crises during the 30’s and second world war delayed the development

The Swedish ”Model”

Make sure that everyone has a job and can support

themselves

Redistribution and Solidarity

Everyone pay taxes

Education

Economic growth

Security

The Strong Society I: Universal Welfare

• Universal welfare: the benefits are for all, not only for the poor.

• ”The paradox of redistribution”: As everyone gets something out of the system, high taxes can be maintained and public support for the system is high

The Strong Society II: Public Sector and Social Insurances

• Public sector: Schools, hospitals, elder care, kindergartens, roads etc.

• Free of charge or strongly subsidized. • High quality - Only the best is good enough for

the people.• Social insurances: Pensions, unemployment

benefits, health insurance, parental leave etc. • Income security: level of benefits related to

previous income.

The Strong Society III: Collective bargain treaties

• Trade unions negotiate on wages with employers’ organizations. Collective agreements to achive high wages and to avoid companies using low wages as a means of competitition.

• Solidaric wages policy – more to those with lower wages. Wages increase with the rise of productivity.

• Politics for full employment, active labour market policies, high unemployment benefits and strong labour laws to protect collective bargaining.

• Low-wage competition from abroad threatens collective bargaining. The labour movement want everyone who work in Sweden to get wages according to colletive bargain treaties.

Basic Principles for the Tax-paying System (1)

• From each and everyone out of capability, to each and everyone out of their needs

• Redistribution between generations, groups and over the lifetime (you get the first and last 20 years, you pay the 40 years in between)

• Income from work and capital shall be equally taxed

Basic Principles for the Tax-paying System (2)

• You contribute and you benefit

• During different periods of life the needs are different, as well as the capability

• We have a common responsibility

How Much Do You Pay?

• Everyone with an income pay tax to the municipality (30% of your income to municipality, province, church)

• If you have a high income, you also pay tax to the state (20% of the higher income)

• VAT 25%, taxes on petrol, real estate, vehicles, liquor and tobacco etc

• Payroll tax on 32% (Paid by the employers)

The Strong Society and Women• The discontent of rising expectations • Gender equality at first a result of reforms for the

working class. • Elder care, hospitals, kindergartens made it

possible for women to take part in the labour force• Trade union demands for equal pay resulted in

higher salaries in ”female jobs”• Today – the Social Democratic Labour Party is a

feminist party

The 1980’s and 90’s• Stronger international competition,

globalisation, neo liberal ideological turn internationally (Reagan, Thatcher...)

• Social Democrats on the defence – ”save what can be saved”. Partial adaption - the ”Third Way”

• Cuts in the welfare state, privatisations etc• High unemployment, especially for young

people and immigrants

The Pendulum Goes Back• Sweden as ”the bumblebee”• Even the Conservatives embrace the Swedish

Model • Higher self-conscience among Social Democrats,

we were right and they were wrong• The 1990’s are over – first budget without any

cutbacks• ”The most successful society the world has ever

known” (Polly Toynbee, The Guardian, October 25th 2005)

Workshop on Ideology, Welfare and Social Cohesion

• What do you think about the Swedish Model?

• What parts of the Swedish Model could be good if it was introduced in your country?

• What should Sweden change and learn from your country?

• The Swedish Model is developed according to Swedish political, economic and social conditions. What obstacles do you see to an introduction of Social Democratic policies in your country?

• What would a Social Democratic Model in your country look like? How could it be achieved?