EU Trade Rules Could Water Down Sweden’s Temperance Movement

Sweden’s 150-year-old temperance movement has been so successful in wresting this country from the Vodka Belt, people like to say that more Swedes live from alcohol now than die from it.

With Europe’s highest taxes on tipples, the welfare state’s coffers get an annual infusion of $1.3 billion from drink sales--and the resulting high prices have depressed consumption and alcohol-related deaths and illnesses to one of the lowest levels in the developed world.

But those enviable achievements are now under assault in the name of consumer harmony on the Continent. The European Union’s trade policies have forced Sweden to ease restrictions on alcohol imports, which could drastically cut domestic revenue from state-monopoly wine, beer and spirits sales unless the government agrees to lower taxes to make purchases here competitive with neighboring countries.

The changes imposed by EU membership also coincide with an emerging sentiment among the responsible-drinking majority in this nation of 8.9 million that it is their business--not the government’s--how much they consume in the safety and privacy of their homes.

“The voices speaking against the ‘Big Brother’ issue have become stronger since we joined the Union,” Bjoern Hibell, director of the Swedish Council for Information on Alcohol and Narcotics, says of the changing public attitudes since Sweden became an EU member in 1995.

Inspired by a history of massive alcohol abuse in the 19th century, the Swedish government has long assumed the role of moral judge and has used taxes and import restrictions to discourage Swedes from drinking.

But Hibell and others charged with analyzing Swedish drinking behavior contend that many Swedes are tolerant of the alcohol tax bite because they recognize the hidden costs of health care for abusers as well as lost labor efficiency and drinking’s contribution to violent crime.

“If you want to be an alcoholic, that’s your business, of course. But most people think alcohol problems are not just a problem for the individual but for the whole society,” says Bjoern Rydberg, spokesman for the state-owned Systembolaget monopoly on alcohol sales and distribution.

Officials are weighing an alcohol tax cut in the face of slumping revenues in southern Sweden since July, when the new import quotas kicked in and a bridge to Denmark opened, allowing consumers to save mightily by doing their booze shopping abroad and taking advantage of more liberal personal import volumes. Without tax relief, Swedes will spend their liquor kroner elsewhere, depriving the country of income that might be used to combat drinking’s related health problems.

An Alcohol Action Plan submitted this fall to the Riksdag, Sweden’s parliament, puts off the divisive tax issue until spring but earmarks about $45 million for local public awareness projects and self-help groups for abusers.

Research across Europe, however, consistently shows that pricing policies, monopoly control, a higher minimum drinking age and low blood-alcohol driving limits are vastly more effective in reducing consumption than information campaigns, says Sven-Olov Carlsson, president of Sweden’s chapter of the International Order of Good Templars.

“The sad thing is that all the discussion now is about Sweden moving toward the EU position, while it would make more sense for other European countries to take steps toward Sweden,” Carlsson says.

While that isn’t in the cards, he predicts that EU enlargement to include the heavy-drinking populations of Eastern Europe will force the alliance to put public health concerns above those of trade and agriculture now driving the drinking debate.

Carlsson recently traveled to Latvia, the tiny Baltic state that is among the candidates for EU membership, where he was appalled to discover that there are 40,000 shops authorized to sell alcohol for the 2.3 million people, compared with 411 stores throughout Sweden, which has four times Latvia’s population.

The temperance leader also bemoans the mixed message that Sweden sends abroad with the highly successful marketing and sales of Absolut vodka--a product of the wholly state-owned Vin & Sprit company that is forbidden to promote its flagship tipple in the homeland.

Sweden’s powerful temperance movement grew out of the enormous abuses prevalent in the mid-19th century, when manual laborers like miners and loggers were often paid in spirits.

Per capita consumption of liquor at that time was 46 liters a year--about six times today’s level in Sweden and three times that of the Continent’s heaviest drinkers, in Portugal, Luxembourg, France, Ireland and Germany. Of 39 developed countries tracked by Swedish researchers, the United States ranks 26th in per capita consumption, with Sweden No. 31 and Turkey the most abstemious of those studied.

“Taxation has proved to be the most effective means of reducing consumption, especially together with the monopoly sales system,” says Gerd Knutsson, the Ministry of Health and Social Issues’ chief advisor on alcohol problems.

Sweden’s blood-alcohol limit for drivers is also among the lowest in the developed world at 0.02%--one-fourth the level allowed in California. The low threshold for defining drunk driving, coupled with staggering fines and risks of jailing, has been successful in keeping alcohol-related traffic accidents the lowest in Europe, Knutsson says.

One persistent problem cited by both proponents and opponents of lower alcohol taxes is the Swedish predilection for binge drinking. Only in the past 20 years has consumption of beer and wine been rising to reflect a shift from total inebriation to social drinking. Sales of the high-proof aquavit infusions for which Sweden is renowned remain strong, and health researchers report that less than 10% of the population accounts for more than half the total alcohol consumption.

“Particularly in rural areas, a lot of Swedes still drink to get drunk, not to enhance food or to be social,” says Hibell, whose state-run institute forecasts an accelerated rise in what are already growing consumption levels.

He notes that Sweden’s steadily improving economy also contributes to rising consumption because more money is available for luxuries like wine and spirits, the prohibitive taxes notwithstanding.

“Alcohol is like any other commodity,” he says. “The cheaper it is, the more you can afford to buy.”

The same bottle of whiskey selling for $11 in Germany retails in Sweden for $25. Wine averages about twice the price here as elsewhere in the EU, and beer costs about 40% more.

Since July, the more liberal EU import allowances permit Swedes returning from trips abroad to bring back up to 20 liters of wine and 24 liters of beer, a twentyfold and twelvefold increase, respectively. Beginning in 2004, the limit on spirits will also rise tenfold, to 10 liters per trip, and the wine and beer allowances to 110 liters for each.

Not everyone will take full advantage of the relaxed import quotas, observes Gunnar Agren, director of the National Institute of Public Health. “For one thing, it would be very heavy and difficult for anyone traveling without a car,” he says of the 2004 quantities, which allow travelers to bring in 2.6 gallons of hard liquor, 157 bottles of wine and 333 12-ounce cans of beer.

Researchers at Agren’s institute predict a 10% increase in consumption from the relaxed import allowances, with a simultaneous loss of revenue from sales by the state liquor monopoly as Swedes dodge the tax burden by buying more abroad.

“We think it’s important to lower taxes before it becomes a habit among Swedes to go to Denmark or Germany to buy their alcohol,” warns Systembolaget spokesman Rydberg. “This is a pity, because taxation is the most effective way to bring down consumption, but it is no longer possible without losing control over the whole system.”

Per capita consumption of pure spirits by Swedes older than 15 is about 8.2 liters per year, which compares favorably with the EU average of 12 liters. But that will rise to 9 liters with the more liberal import quotas and to as much as 11 liters if the Riksdag decides to lower taxes to put Swedish prices at the Danish level, Agren says, basing his prediction on the institute’s extensive consumer research.

While the import levels have eased to conform to EU standards, other changes are being tested because of Swedish consumer demand. Until earlier this year, the Systembolaget shops operated only Monday through Friday from 9 a.m. to 6 p.m., but a few stores in major cities now have Saturday shopping until 2 p.m. That extension is cast as a one-year experiment, but authorities concede that it would be difficult to rescind what is a convenience for the majority because a small minority might show signs of further abuse.

The country does have a history of reversing policy in the face of worsening problems, though. To encourage a shift away from drinking hard liquor, the Swedish government in 1965 allowed grocery stores to sell beer and lifted the tax on national brews. But that liberalization was revoked 12 years later, when it became apparent that underage Swedes were more readily able to obtain beer and were increasingly showing up in traffic, health and crime statistics.

Despite a general trend toward loosening the state’s chokehold on drinkers, there is little public pressure for lifting a ban on all alcohol advertising or even ending the state outlet monopoly that so severely restricts retail sales.

“Much depends on how the questions are posed,” says Carlsson of the temperance movement. “If you ask people if they want lower taxes, of course they will say yes. But if you ask them if what has been a successful alcohol policy should be changed, with all the social and health damage that implies, most Swedes would support the higher taxes.”