For Swedes, Pride Turns to Anger

Each afternoon, they gather at the Sibelius bar, on a well-trod pedestrian lane in this suburb of Stockholm: the flotsam of a system that wasn’t supposed to let anyone down.

There is Steiner Holth, once a highly paid pressman who, at 47, was forced out of his job just in time to sample the cutbacks in Sweden’s unemployment-compensation program.

There is Karin Skognstad, who broke her wrist and discovered how much the national sick-pay rate had been rolled back.

There is Ingmar Gesmo, a 50-year-old bus driver whose employer was privatized and who was given a choice: longer hours and a pay cut, or a layoff, in an economy where unemployment is close to 14%.

Amid the bike paths, parks, libraries and day-care centers of their amply provisioned little corner of the Swedish welfare state, these unfortunates and their unemployable friends while away the afternoons in a beer joint, passing around dog-eared copies of the Stockholm tabloids and venting steam over the outrages reported inside.

For not only has Sweden--burdened by a yawning budget deficit and little possibility of increasing tax revenue--been struggling to slim down its famous welfare state these last few years. It turns out that some of the very people once trusted to administer the system--members of the political circle now telling Holth and Skognstad and the rest to pull up their socks, that a little sacrifice would be just the thing for Swedish society--are playing the system in ways people here expect to see in a Third World backwater but not in their own correct Nordic state.

“If you ask me, they should all be in jail,” says Sibelius regular Brittmarie Heydorm, a 53-year-old former government researcher who, since she was laid off, has been making a living nursing the elderly.

Recent months have seen scandal follow scandal within Sweden’s Social Democratic Party, which has ruled this country for all but 10 of the last 64 years, and which put in place the womb-to-tomb welfare state after World War II.

Most of the wrongdoing involves municipal politicians and such small-time incidents as taxpayer-subsidized trips to restaurants and strip clubs. But what makes the scandals matter here is, well, this is Sweden--a proud society, with dour Protestant understandings about hard work, honesty and civic responsibility. Egalitarianism is the bedrock concept of the culture here, the way individual liberty is in the United States.

Wrongdoing in public office “clashes with the idea of most people in this country,” says Jan Guillot, a popular Swedish novelist. “We’re not used to this.”

More than almost any other people, Swedes have grown accustomed over the years to an enemy-free status in the world, and to the admiration of most nations. Modern Sweden stayed out of both world wars and until recently had been ranked at or near the top of all manner of achievement and standard-of-living ratings. It was virtually unchallenged in everything from longevity to the generosity of its foreign aid.

With a neutral foreign policy, a set of ancient and liberal assumptions about press freedom, a handsome record on the succoring of refugees and a relatively likable royal family, Sweden for years could fill a position as the “world’s conscience,” a shining example to less tolerant and less generous nations.

“We have felt that we were a country chosen by God,” says Jan Herin, chief economist of the Swedish Employers Federation. “No wars. No social conflicts. No poor people in the streets. We are Lutherans--not in the religious sense, but in terms of our work ethic.”

Drawing particular international interest was Sweden’s economy. Throughout much of the Cold War, Sweden seemed near-miraculous proof that it was possible to combine the protections of democratic socialism with the dynamism of capitalism--to find a successful Third Way.

“Delegation after delegation came up to Sweden, to see if they could copy it,” Herin recalls.

From 1949 to 1989, Sweden boasted a mix of near-zero unemployment, robust multinational companies, clean and safe city streets, and--until the 1970s, at least--low state spending. In 1950, public spending was proportionally among the lowest in the industrialized world when compared with economic output.

It is achievements like these, and the assumptions about self and nationhood they engendered, that make today’s political grime and economic setbacks--chronic double-digit unemployment and the never-ending search for “fat” to trim--so painful.

At a table crowded with beer glasses and coffee cups next to the big front window, Mats Jonberger--another Sibelius regular--spreads out a couple of newspapers. The daily Dagens Nyheter features a chart ranking Sweden 14th in world economic competitiveness.

The daily Aftonbladet has a long expose comparing the tax load borne by a lot of old Swedish families to the families’ annual receipts in the form of European Union farm subsidies. Invariably, the aristocrats are getting more from Brussels than they are paying into the Swedish exchequer. A photo shows one of the families in a poolside frolic.

“That’s the taxpayers’ money,” Jonberger says. To him, the old-name types seem to be taking a free ride on the farm subsidies. The former limousine driver has lost his wife, his apartment and his job--all in about three years.

At 56, he has little prospect of getting a new job. Most of the Sibelius regulars belong to Sweden’s least employable age category; they readily admit that the main reason they go for job interviews is to remain eligible for unemployment benefits, not because they feel any hope.

“You can see why this is sticking in our eyes,” Jonberger says.

Sweden’s new season of political unease began in 1995, when the front-running contender for prime minister, Mona Sahlin, was reported by the tabloid Expressen to have used her state-provided credit card to pay for such personal items as snacks and auto rentals.

Sahlin, who was then deputy prime minister and sexual equality minister in the Social Democratic government, had paid the amounts back, but it sometimes took her a month or more to do so.

To jaded Americans, capable of digesting and forgetting accounts of presidential telephone conversations overheard by call girls, this may sound like tame stuff. Sahlin’s “crime” amounts to a series of unauthorized, interest-free loans, usually in the low three figures.

But given Sweden’s sturdy traditions of probity and fairness, Sahlin felt obliged to step down after the revelations hit print. Former Finance Minister Goran Persson became prime minister.

The Sahlin episode inspired regional newspapers in Sweden to have a look at who else might be breaking the rules. What they turned up has outraged hard-pressed ordinary citizens:

* In Gavle, north of Stockholm, records suggest that city and county politicians charged visits to a Brussels porno club to their government credit cards while supposedly attending a European symposium on traffic problems.

* Gavle’s chapter president of the Swedish Assn. of Local Authorities is reported to have used his expense account to cover more than $100,000 in gambling debts.

* In Motala, a city about 150 miles southwest of Stockholm, politicians are revealed to have treated themselves and their wives to taxpayer-funded meals, clothing and pleasure trips to Berlin and the French Riviera.

* In Orebro, west of Stockholm, the governor, who was also serving on a panel inquiring into the 1986 killing of Prime Minister Olof Palme, allegedly doctored his receipts with scissors and cellophane tape, and sent duplicate copies to more than one reimbursing body. The governor denies any wrongdoing but has resigned his post on the Palme panel.

* In September, a prominent politician in Linkoping, in southern Sweden, resigned after a newspaper accused him of taking a taxpayer-financed hunting trip to Poland, disguised as a tour of a steel mill.

Recent months have also brought hard-to-take revelations about gaudy severance packages for senior bureaucrats, and bloated salaries and pay raises in the civil service.

“The director general of the Swedish Post Office fired a lot of mailmen to reduce costs, so the level of postal service went down too,” recalls Guillot, the novelist. “Then he raised his own salary five or 10 times and gave himself a golden parachute. The explanation was that guys like him take such extraordinary risks in the market, but that’s ridiculous. There’s no market for mail delivery. It’s a monopoly.”

Officeholder misbehavior compounds the struggle Swedes already are engaged in trying to come to terms with a string of ugly, and most un-Swedish, incidents dating to the slaying of Palme on a Stockholm sidewalk.

It is a testament to Sweden’s sense of security and civility back then that the prime minister was out walking with his wife on the dark, snowy streets after a movie, without so much as a bodyguard. After he was shot, public buildings were fitted with bulletproof glass and other security measures, and Swedes consider themselves diminished as a result. The crime has never been solved.

Much different in nature--but still deeply unsettling here--was the sinking in September 1994 of the Baltic ferry Estonia, with the loss of nearly 1,000 lives, most of them Swedes. In a country unaccustomed to war and great natural disasters, the incident marked the largest loss of life in one day since the Napoleonic Wars.

The loss of the Estonia was also framed by two gun massacres--the sort Northern Europeans associate with the United States’ mean streets but not with their own cobbled lanes and tree-bordered squares. In the summer of 1994, a Swedish army lieutenant stationed in the city of Falun went on a rampage and shot seven bystanders to death. And in December 1994, a young man denied entry to a popular Stockholm discotheque came back and opened fire with an assault rifle, killing four patrons.

All this came on top of the pain of 1993, when the “Swedish Model” economy hit a stone wall.

Growth, which had been faltering ever since the oil shocks of the early 1970s, petered out completely; the Social Democrats’ attempts to spend their way back to growth and full employment led to a huge budget deficit. Suddenly, the country that had never known unemployment had a rate as high as 14%, depending on the measurement technique, and government spending had reached 73% of economic output.

Today, many economists applaud Sweden’s ongoing efforts to restore economic order, bringing inflation well under control and reducing certain public benefits that were well above the European average. Budget reductions are said to be on track, and the public debt is expected to stabilize by 1998.

But the unemployment rate is stuck at calamitous levels. And there has been fundamental change in public attitudes. A society once admired for its trust, generosity and high moral standards has become harder, less self-confident, more suspicious.

“We have a proverb in Sweden: When the hay in the stable runs short, the horses start to bite,” Herin says. “It’s sad but true. We have had quite serious fights about wealth distribution. There is more and more tension in our society. Nobody is out protesting in the streets, but that is coming. People don’t trust the politicians.”

Back at the Sibelius, Jonberger agrees.

“The state gives with one hand and grabs back with the other,” he says. “And it grabs back more. These [austerity] cuts wouldn’t be necessary if you sort of spread the wealth around, instead of increasing state salaries.”

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A Plunge in Prosperity

From 1970 to 1994, Sweden fell from 4th to 17th position in rankings of the world’s richest countries.

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1970 1980 1990 1. Switzerland 1. U.S. 1. Luxembourg 2. U.S. 2. Switzerland 2. U.S. 3. Luxembourg 3. Luxembourg 3. Switzerland 4. Sweden 4. Canada 4. Japan 5. Canada 5. Iceland 5. Belgium 6. Denmark 6. France 6. Canada 7. Denmark 7. Sweden 7. Denmark 8. Netherlands 8. Netherlands 8. Norway 9. Australia 9. Austria 9. Iceland 10. New Zealand 10. Belgium 10. Austria 11. Britain 11. Denmark 11. France 12. Belgium 12. Australia 12. Germany (western) 13. West Germany 13. Italy 13. Australia 14. Austria 14. Norway 14. Italy 15. Italy 15. West Germany 15. Netherlands 16. Finland 16. Finland 16. Britain 17. Japan 17. Japan 17. Sweden 18. Iceland 18. Britain 18. Finland 19. Norway 19. New Zealand 19. New Zealand 20. Spain 20. Spain 20. Ireland

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Note: Based on per capita gross domestic product

Source: OECD