several articles on social democracy, peace, crisis of capitalism, DNC

8 Sep

FOR IMMEDIATE RELEASE
September 5, 2012
5:52 PM

CONTACT: Center for Economic and Policy Research (CEPR)

Alan Barber, (202) 293-5380 x115

Share of Bad Jobs Has Risen Since 1979

WASHINGTON – September 5 – Almost one-fourth of U.S. workers are in a bad job, according to a new report from the Center for Economic and Policy Research (CEPR). Despite substantial increases in the education, age, and quantity and quality of technology over the last three decades, the share of workers with a “bad job” has risen since 1979, the CEPR researchers concluded.

The report, “Bad Jobs on the Rise,” defines a bad job as one that pays less than $37,000 per yeardoes not have employer-provided health insurance, and lacks some kind of retirement plan. The $37,000 figure (which translates to about $18.50 per hour, full-time) is equal to the inflation-adjusted earnings of the typical male worker in 1979, the first year of data analyzed in the report. The new report complements earlier CEPR research documenting the decline in good jobs over this same period.

By this definition, in 2010, 24 percent of the workforce had a “bad job,” up from 18 percent in 1979.

Compared to the end of the 1970s, the typical worker today is almost twice as likely to have a four-year college degree, is about seven years older, works with about 50 percent more physical capital, and uses much more advanced technology. Despite this, the share of bad jobs has grown.

“The increase in the share of bad jobs has little to do with the Great Recession,” said John Schmitt, a senior economist at CEPR and one of the report’s co-authors “Almost all of the increase we document had already occurred by 2007, before the downturn.”

The main driver of the rise in bad jobs, the report argues, was the systematic decline in workers’ bargaining power since the end of the 1970s.The reports’ authors point to the fall in the inflation-adjusted value of the minimum wage, the decline in union representation, trade deals, and high unemployment as some of the key factors reducing the bargaining power of workers relative to their employers.

The full report can be found here.

###

The Center for Economic and Policy Research (CEPR) was established in 1999 to promote democratic debate on the most important economic and social issues that affect people’s lives. In order for citizens to effectively exercise their voices in a democracy, they should be informed about the problems and choices that they face. CEPR is committed to presenting issues in an accurate and understandable manner, so that the public is better prepared to choose among the various policy options.


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from Yahoo news:
Elizabeth Warren expresses our frustrations:

CHARLOTTE, N.C.–In her speech to the Democratic National Convention on Wednesday, Massachusetts Senate candidate Elizabeth Warren said that the American system of government is “rigged” against the middle class.

People feel like the system is rigged against them. And here’s the painful part: they’re right,” Warren said in her first address to a party convention. “The system is rigged. Look around. Oil companies guzzle down billions in subsidies. Billionaires pay lower tax rates than their secretaries. Wall Street CEOs—the same ones who wrecked our economy and destroyed millions of jobs—still strut around Congress, no shame, demanding favors, and acting like we should thank them. Anyone here have a problem with that? Well I do.”

Warren is running against Republican Massachusetts Sen. Scott Brown, who won the seat in a 2010 special election following the death of former Sen. Edward Kennedy.

Her full remarks:

 

Thank you! I’m Elizabeth Warren, and this is my first Democratic Convention. Never thought I’d run for senate. And I sure never dreamed that I’d get to be the warm-up act for President Bill Clinton—an amazing man, who had the good sense to marry one of the coolest women on the planet. I want to give a special shout out to the Massachusetts delegation. I’m counting on you to help me win and to help President Obama win.

I’m here tonight to talk about hard-working people: people who get up early, stay up late, cook dinner and help out with homework; people who can be counted on to help their kids, their parents, their neighbors, and the lady down the street whose car broke down; people who work their hearts out but are up against a hard truth—the game is rigged against them.

It wasn’t always this way. Like a lot of you, I grew up in a family on the ragged edge of the middle class. My daddy sold carpeting and ended up as a maintenance man. After he had a heart attack, my mom worked the phones at Sears so we could hang on to our house. My three brothers all served in the military. One was career. The second worked a good union job in construction. The third started a small business.

Me, I was waiting tables at 13 and married at 19. I graduated from public schools and taught elementary school. I have a wonderful husband, two great children, and three beautiful grandchildren. And I’m grateful, down to my toes, for every opportunity that America gave me. This is a great country. I grew up in an America that invested in its kids and built a strong middle class; that allowed millions of children to rise from poverty and establish secure lives. An America that created Social Security and Medicare so that seniors could live with dignity; an America in which each generation built something solid so that the next generation could build something better.

But for many years now, our middle class has been chipped, squeezed, and hammered. Talk to the construction worker I met from Malden, Massachusetts, who went nine months without finding work. Talk to the head of a manufacturing company in Franklin trying to protect jobs but worried about rising costs. Talk to the student in Worcester who worked hard to finish his college degree, and now he’s drowning in debt. Their fight is my fight, and it’s Barack Obama’s fight too.

People feel like the system is rigged against them. And here’s the painful part: they’re right. The system is rigged. Look around. Oil companies guzzle down billions in subsidies. Billionaires pay lower tax rates than their secretaries. Wall Street CEOs—the same ones who wrecked our economy and destroyed millions of jobs—still strut around Congress, no shame, demanding favors, and acting like we should thank them.

Anyone here have a problem with that? Well I do. I talk to small business owners all across Massachusetts.

Not one of them—not one—made big bucks from the risky Wall Street bets that brought down our economy. I talk to nurses and programmers, salespeople and firefighters—people who bust their tails every day. Not one of them—not one—stashes their money in the Cayman Islands to avoid paying their fair share of taxes.

These folks don’t resent that someone else makes more money. We’re Americans. We celebrate success. We just don’t want the game to be rigged. We’ve fought to level the playing field before. About a century ago, when corrosive greed threatened our economy and our way of life, the American people came together under the leadership of Teddy Roosevelt and other progressives, to bring our nation back from the brink.

We started to take children out of factories and put them in schools. We began to give meaning to the words “consumer protection” by making our food and medicine safe. And we gave the little guys a better chance to compete by preventing the big guys from rigging the markets. We turned adversity into progress because that’s what we do.

Americans are fighters. We are tough, resourceful and creative. If we have the chance to fight on a level playing field—where everyone pays a fair share and everyone has a real shot—then no one can stop us. President Obama gets it because he’s spent his life fighting for the middle class. And now he’s fighting to level that playing field—because we know that the economy doesn’t grow from the top down, but from the middle class out and the bottom up. That’s how we create jobs and reduce the debt.

And Mitt Romney? He wants to give tax cuts to millionaires and billionaires. But for middle-class families who are hanging on by their fingernails? His plans will hammer them with a new tax hike of up to 2,000 dollars. Mitt Romney wants to give billions in breaks to big corporations—but he and Paul Ryan would pulverize financial reform, voucher-ize Medicare, and vaporize Obamacare.

The Republican vision is clear: “I’ve got mine, the rest of you are on your own.” Republicans say they don’t believe in government. Sure they do. They believe in government to help themselves and their powerful friends. After all, Mitt Romney’s the guy who said corporations are people.

No, Governor Romney, corporations are not people. People have hearts, they have kids, they get jobs, they get sick, they cry, they dance. They live, they love, and they die. And that matters. That matters because we don’t run this country for corporations, we run it for people. And that’s why we need Barack Obama.

After the financial crisis, President Obama knew that we had to clean up Wall Street. For years, families had been tricked by credit cards, fooled by student loans and cheated on mortgages. I had an idea for a consumer financial protection agency to stop the rip-offs. The big banks sure didn’t like it, and they marshaled one of the biggest lobbying forces on earth to destroy the agency before it ever saw the light of day. American families didn’t have an army of lobbyists on our side, but what we had was a president—President Obama leading the way. And when the lobbyists were closing in for the kill, Barack Obama squared his shoulders, planted his feet, and stood firm. And that’s how we won.

By the way, just a few weeks ago, that little agency caught one of the biggest credit card companies cheating its customers and made it give people back every penny it took, plus millions of dollars in fines. That’s what happens when you have a president on the side of the middle class.

President Obama believes in a level playing field. He believes in a country where nobody gets a free ride or a golden parachute. A country where anyone who has a great idea and rolls up their sleeves has a chance to build a business, and anyone who works hard can build some security and raise a family. President Obama believes in a country where billionaires pay their taxes just like their secretaries do, and—I can’t believe I have to say this in 2012—a country where women get equal pay for equal work.

He believes in a country where everyone is held accountable. Where no one can steal your purse on Main Street or your pension on Wall Street. President Obama believes in a country where we invest in education, in roads and bridges, in science, and in the future, so we can create new opportunities, so the next kid can make it big, and the kid after that, and the kid after that. That’s what president Obama believes. And that’s how we build the economy of the future. An economy with more jobs and less debt. We root it in fairness. We grow it with opportunity. And we build it together.

I grew up in the Methodist Church and taught Sunday school. One of my favorite passages of scripture is: “Inasmuch as ye have done it unto one of the least of these my brethren, ye have done it unto me.” Matthew 25:40. The passage teaches about God in each of us, that we are bound to each other and called to act. Not to sit, not to wait, but to act—all of us together.

Senator Kennedy understood that call. Four years ago, he addressed our convention for the last time. He said, “We have never lost our belief that we are all called to a better country and a newer world.” Generation after generation, Americans have answered that call. And now we are called again. We are called to restore opportunity for every American. We are called to give America’s working families a fighting chance. We are called to build something solid so the next generation can build something better.

So let me ask you—let me ask you, America: are you ready to answer this call? Are you ready to fight for good jobs and a strong middle class? Are you ready to work for a level playing field? Are you ready to prove to another generation of Americans that we can build a better country and a newer world?

Joe Biden is ready. Barack Obama is ready. I’m ready. You’re ready. America’s ready. Thank you! And God bless America!

 
 
Published on Wednesday, September 5, 2012 by Earth Island Journal

Politics and Plutocrats: A Parade of Inequality

America is currently engaged in the most expensive presidential contest in world history. In the United States, money doesn’t just talk – it dictates. How can we hope to make progress on the path to sustainability when the road is blocked by barricades of bullion backed by battalions of billionaires? How do we break through the political gridlock?

Dave Brower’s wife, Ann, once put a wise spin on this dilemma. “What we need,” she said, is “a cure for greedlock.”

Earth’s richest 1,000 individuals now control as much wealth as the poorest 2.5 billion people on the planet. This super elite uses its vast wealth to control the media, influence politicians, and bend laws to their favor. In the US, the wealthy dominate our government: 47 percent of US representatives are millionaires, as are 67 percent of US senators. The Center for Responsive Politics reports Congressional wealth has increased 11 percent between 2009 and 2011.

Not only is our economy out of balance with nature, our economy is also out of balance with the practical limits of physical and fiscal reality. As the Occupy movement has indelibly framed it, we are now a society divided not only by haves and have-nots, but we are a nation – and a world – divided into the 99 percent and the 1 percent.

Imagine if a tree were engineered like the US economy – with half of its mass centered in the top 10 percent of its height and 40 percent of its mass concentrated in the very topmost branches. Whether redwood or oak, such a tree would not be stable in a windstorm. It would be destined to topple. Of course, nature has better sense.

In 2011, the International Forum on Globalization (IFG) published a report called Outing the Oligarchy designed to focus public attention on “the ultra-rich individuals who benefit most from – and are most responsible for – the growing climate chaos that is destabilizing global ecosystems.” It defined them as “a small elite of powerful billionaires who profit from polluting the atmosphere by promoting government policies that support an unsustainable reliance on fossil fuels.”

The IFG report illustrated the growing rich-poor gap by visualizing a parade in which all the residents of Canada ambled down a city street on a single day. Let’s translate that vision to the US.

Imagine if everyone in America was invited to parade down Pennsylvania Avenue in Washington, DC. Imagine if the parade took just one hour. Imagine if the march began with the poorest people in the lead. Imagine if all the marchers’ income levels were indicated by their height. Here’s what such a parade would look like:

For the first 10 minutes, the lead marchers (those who survive on only a few thousands dollars a year) look like toddlers, barely a foot tall. Around 15 minutes into the parade, the marchers are not quite so poor: They now stand about three feet tall. This tide of half-sized adults continues for the next 25 minutes. Only after more than two-thirds of the population has surged down the parade route do we begin to see normal-sized marchers (those making an average income). For the next 10 minutes or so, the spectacle resembles a normal parade. Then things start to get really strange.

In the final 10 minutes, we start to see marchers who are wealthier than average: people who are seven, even eight feet tall. In the last six minutes, the marchers loom more than 14 feet tall. With 25 seconds left, the minority of super-rich marchers looks down from a height of more than 30 feet – nearly six times the size of the average marcher; 30 times the size of those who made up the first quarter of the parade.

In the closing seconds of this parade of wealth, the shoulders of some marchers extend thousands of feet into the sky – these are the plutocrats. Finally, bringing up the rear, in the very last second of the march, are the most powerful and dominant members of the power elite – a select band of Godzilla-like oligarchs who look down upon everyone else from an astonishing altitude of 8,000-plus-feet. No wonder the superrich seem so removed and aloof.

Just like the banking system, when something is “too big to fail” it becomes a danger to itself and others. Nature would never tolerate such a system. Nor should we.

Note: This column originally appeared in the Autumn print edition of Earth Island Journal and appears at Common Dreams with permission.

© 2012 Earth Island Journal
Gar Smith

Gar Smith is co-founder of Environmentalists Against War and Editor Emeritus of Earth Island Journal.

 
 

Published on Tuesday, September 4, 2012 by Common Dreams

Wall Street South March on the DNC: Good Cop, Bad Cop

Police officers observe protestors marching in the ‘Wall Street South March’, Sunday, Sept. 2, 2012, in Charlotte, N.C. Demonstrators are protesting before the start of the Democratic National Convention. (AP/Patrick Semansky)

I was initially surprised at the demeanor of the police in Charlotte during the Wall Street South March on the Democratic National Convention (DNC). Even though I lived in North Carolina for 14 years, I always relish the cordiality when I return. But friendliness by cops at a protest?

Last fall I had witnessed aggressive Oakland police in full riot gear during countless occupy marches, club-bearing University of California-Berkeley police attacking students, and I was even arrested by nervous and edgy mall cops while videotaping a Black Friday protest in Raleigh. So today I was taken aback by the police officer who stopped to help me pick up some things I dropped and who was one of a dozen police officers who interacted with me using kind words.

Explaining this behavior isn’t simply a question of southern hospitality. While police officers, yes, are people, too, and are facing cutbacks like many public employees across the country, the Charlotte effect was more than that.

First, cops could afford to be friendly. Literally. The DNC poured in 50 millions of dollars to the Charlotte-Mecklenburg Police. This helped fund the nifty bicycles and helmets they wore as they escorted protesters. But it also funded countless security cameras and Spot Shotters. But they also could afford the pleasantries because police seemed to outnumber protesters, so there was no threat to their power. An estimated 1000 protesters marched on September 2, but their numbers paled in comparison to the police presence, which included city police from around the state, as well as county and federal law enforcement.

Second, however, the kind behavior didn’t last. As the march began to approach the city center, the finance capital hub of the city and much of the country, the smiles faded. The cops on bikes lining the parade route changed to metal barricades. For a moment, I stepped off of the street protest to walk a bit faster on the sidewalk, but that proved problematic. The police would no longer let anyone into the march nor let anyone out. I was told that because I wasn’t “credentialed,” I couldn’t get in, but I witnessed several mainstream media journalists trapped as well. Yes, trapped. With the metal barricades and police officers lining every inch of the curb, activists and journalists inside were “kettled.” This means that the people inside would have had no escape if an incident triggered police use of teargas or other means of assaulting protesters. It also meant that people couldn’t join the march. One couple, with baby in tow, expressed frustration at not being able to participate in the march. “We kept trying to get in at various parts of the march but kept being turned away by the police,” said the mother.

In effect, the barricades – both human and metal – were protecting the financial interests lining this part of the parade route, such as Bank of America and Wells Fargo. Both sides understand the target of the protests. And the banks won’t play nice, either.

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wikipedia:
Hjalmar Branting was elected the first Social Democratic Prime Minister in 1920

The Partys first chapter in its statutes says “the intension of the Swedish Social democratic Workers Party is the struggle towards the Democratic Socialism.” The ideology of socialism was founded in the New Testament, Acts (Apostlagarningarna) chapter 4, verse 32-35, where the basics are told for the paroll: “From each according to his ability, to each according to his need.” [ Karl Marx[ Since the party has held power of office for a majority of terms after its founding in 1889, the ideology and policies of the Social Democratic Party (SAP) have had strong influence on Swedish politics.[11] The Swedish social democratic ideology is partially an outgrowth of the strong and well-organized 1880s and 1890s working class emancipation, temperance, and religious folkrörelser (folk movements), by which peasant and workers’ organizations penetrated state structures early on and paved the way for electoral politics. These movements had influence on political formation in Sweden, at least in part because they experienced less state repression than similar working-class organizations have, for example, in early twentieth century Russia. In this way, Swedish social-democratic ideology is inflected by a socialist tradition foregrounding widespread and individual human development.[12] Gunnar Adler-Karlsson (1967) confidently likened the social democratic project to the successful social democratic effort to divest the king of all power but formal grandeur: “Without dangerous and disruptive internal fights…After a few decades they (capitalists) will then remain, perhaps formally as kings, but in reality as naked symbols of a passed and inferior development state.”[13] However, so far this socialist ambition has not materialised.[citation needed]

 Liberalism

Prime Minister Tage Erlander at a TV debate in 1967

Liberalism has also strongly infused social democratic ideology. Liberalism has oriented social democratic goals to security, as where Tage Erlander, prime minister from 1946 to 1969, described security as “too big a problem for the individual to solve with only his own power”.[14] Up to the 1980s, when neoliberalism began to provide an alternative, aggressively pro-capitalist model for ensuring social quiescence, the SAP was able to secure capital’s co-operation by convincing capital that it shared the goals of increasing economic growth and reducing social friction. For many social democrats, Marxism is loosely held to be valuable for its emphasis on changing the world for a more just, better future.[15] In 1889, Hjalmar Brantingleader of the SAP from its founding to his death in 1925, asserted, “I believe…that one benefits the workers…so much more by forcing through reforms which alleviate and strengthen their position, than by saying that only a revolution can help them.”[16] Some observers have argued that this liberal aspect has hardened into increasingly neoliberal ideology and policies, gradually maximizing the latitude of powerful market actors.[17] Certainly, neoclassical economists{Adam Smithites} have been firmly nudging the Social Democratic Party into capitulating to most of capital’s traditional preferences and prerogatives, which they term “modern industrial relations“.[18] Both socialist and liberal aspects of the party were influenced by the dual sympathies of early leader Hjalmar Branting, and manifest in the party’s first actions: reducing the work day to eight hours and establishing the franchise for working-class people.

While some commentators have seen the party lose focus with the rise of SAP neoliberal study groups, the Swedish Social Democratic Party has for many years appealed to Swedes as innovative, capable, and worthy of running the state.[19] The Social Democrats became one of the most successful political parties in the world, with some structural advantages in addition to their auspicious birth within vibrant folkrörelser. At the close of the nineteenth century, liberals and socialists had to band together to augment establishment democracy, which was at that point embarrassingly behind in Sweden; they could point to formal democratic advances elsewhere to motivate political action.[20] In addition to being small, Sweden was a semi-peripheral country at the beginning of the twentieth century, considered unimportant to competing global political factions; so it was permitted more independence, while soon the existence of communist and capitalist superpowers allowed social democracy to flourish in the geo-political interstices.[21] The SAP has the resource of sharing ideas and experiences, and working with its sister parties throughout the Nordic countries. Sweden could also borrow and innovate upon ideas from English-language economists, which was an advantage for the Social Democrats in the Great Depression; but more advantageous for the bourgeois parties in the 1980s and afterward. While the SAP has not been innocent of repressing communists,[22] the party has overall benefitted, in government coalition and in avoiding severe stagnation and drift, by engaging in relatively constructive relationships with the more radical Left Party and the Green Party. The early SAP had internal resources as well, in creative politicians with brilliant tactical minds, and similarly creative labor economists at their disposal.

[] Revisionism

Among the social movement tactics of the Swedish Social Democratic Party in the twentieth century was its redefinition of “socialization” from “common ownership of the means of production” to increasing “democratic influence over the economy.”[23] Starting out in a socialist-liberal coalition fighting for the vote, the Swedish Social Democrats defined socialism as the development of democracy—political and economic.[24] On that basis they could form coalitions, innovate, and govern where other European social democratic parties became crippled and crumbled under Right-wing regimes. The Swedish Social Democrats could count the middle class among their solidaristic working class constituency by recognizing the middle class as “economically dependent”, “working people”, or among the “progressive citizens”, rather than as sub-capitalists.[25] “The party does not aim to support and help [one] working class at the expense of the others,” the Social Democratic congress of 1932 established. In fact, with social democratic policies that refrained from supporting inefficient and low-profit businesses in favor of cultivating higher-quality working conditions, as well as a strong commitment to public education, the middle class in Sweden became so large that the capitalist class has remained concentrated.[26] Not only did the SAP fuse the growing middle class into their constituency, they also ingeniously forged periodic coalitions with small-scale farmers (as members of the “exploited classes”) to great strategic effect.[27] The SAP version of socialist ideology allowed them to maintain a prescient view of the working class: “[The SAP] does not question…whether those who have become capitalism’s victims…are industrial workers, farmers, agricultural laborers, forestry workers, store clerks, civil servants or intellectuals”, asserted the party’s 1932 election manifesto.[28]

While the SAP has worked more or less constructively with more radical Left parties in Sweden, the Social Democrats have borrowed from socialists some of their discourse, and decreasingly, the socialist understanding of the structurally compromised position of labor under capitalism. Even more creatively, the Social Democrats commandeered selected, transcendental images from such nationalists as Rudolf Kjellen (1912), very effectively undercutting fascism’s appeal in Sweden.[29] In this way, Per Albin Hansson declared that “there is no more patriotic party than the [SAP since] the most patriotic act is to create a land in which all feel at home,” famously igniting Swedes’ innermost longing for transcendence with the idea of the Folkhem (1928), or People’s Home. The Social Democratic Party promoted Folkhemmet as a socialist home at a point in which the party turned its back on working class struggle and the policy tool of nationalization.[30] “The expansion of the party to a people’s party does not mean and must not mean a watering down of socialist demands,” Hansson soothed.[31]

“The basis of the home is community and togetherness. The good home does not recognize any privileged or neglected members, nor any favorite or stepchildren. In the good home there is equality, consideration, co-operation, and helpfulness. Applied to the great people’s and citizens’ home this would mean the breaking down of all the social and economic barriers that now separate citizens into the privileged and the neglected, into the rulers and the dependents, into the rich and the poor, the propertied and the impoverished, the plunderers and the plundered. Swedish society is not yet the people’s home. There is a formal equality, equality of political rights, but from a social perspective, the class society remains, and from an economic perspective the dictatorship of the few prevails” (Hansson 1928).[32]

 Social democracy

The Social Democratic Party is generally recognized as the main architect of the progressive taxationfair trade, low-unemployment, Active Labor Market Policies (ALMP)-based Swedish welfare state that was developed in the years after World War II. Sweden emerged sound from the Great Depression with a brief, successful “Keynesianism-before Keynes” economic program advocated by Ernst Wigforss, a prominent Social Democrat who educated himself in economics by studying the work of the British radical Liberal economists. The social democratic labor market policies (ALMPs) were developed in the 1940s and 1950s by LO (Landsorganisationen i Sverige, the blue-collar union federation) economists Gösta Rehn and Rudolf Meidner.[33] The Rehn-Meidner model featured the centralized system of wage bargaining that aimed to both set wages at a “just” level and promote business efficiency and productivity. With the pre-1983 cooperation of capital and labor federations that bargained independently of the state, the state determined that wages would be higher than the market would set in firms that were inefficient or uncompetitive and lower than the market would set in firms that were highly productive and competitive. Workers were compensated with state-sponsored retraining and relocating; as well, the state reformed wages to the goal of “equal pay for equal work”, eliminated unemployment (“the reserve army of labor”) as a disciplinary device, and kept incomes consistently rising, while taxing progressively and pooling social wealth to deliver services through local governments.[34] Social Democratic policy has traditionally emphasized a state spending structure whereby public services are supplied via local government, as opposed to emphasizing social insurance program transfers.[35]

These social democratic policies have had international influence. The early Swedish “red-green” coalition encouraged Nordic-networked socialists in the state of Minnesota, in the U.S., to dedicate efforts to building a similarly potent labor-farmer alliance that put the socialists in the governorship, ran model innovative statewide anti-racism programs in the early years of the twentieth century, and enabled federal forest managers in Minnesota to practice a precocious ecological-socialism, before Democratic Party reformers were transferred from the U.S. East Coast to appropriate the Minnesota Farmer-Labor Party infrastructure to the liberal Democratic Party in 1944.[36] On the other hand, policies comprising the Nordic model have often been depicted, in American conservative circles and the American press, as wreaking havoc upon Swedish society.

 

Social democratic leader and Prime Minister Olof Palme in the 1970s

Under the Social Democrats’ administration, Sweden retained neutrality, as a foreign policy guideline, during the wars of the twentieth century, including the Cold War. Neutrality preserved the Swedish economy and boosted Sweden’s economic competitiveness in the first half of the twentieth century, as other European countries’ economies were devastated by war.[39] Under Olof Palme‘s Social Democratic leadership Sweden further aggravated the hostility of United States political conservatives when Palme openly denounced US aggression in VietnamU.S. President Richard Nixon suspended diplomatic ties with the social democratic country.[citation needed] In 2003, top-ranking Social Democratic Party politician Anna Lindh–who criticized the U.S. invasion of Iraq, as well as both Israeli and Palestinian atrocities, and who was the lead figure promoting the European Union in Sweden—was assassinated in public in Stockholm. As Lindh was to succeed Goran Persson in the party leadership, her death was deeply disruptive to the party as well as to the campaign to promote the adoption of the EMU (euro) in Sweden. The neutrality policy has changed with the contemporary ascendance of the bourgeois coalition, and Sweden has committed troops to support the US and UK’s interventions in Afghanistan. Under Social Democratic governance relatively strong overseas humanitarian programs and a comparatively well-developed refugee program have been implemented, and frequently reformed.[40]

 Rehn-Meidner Macroeconomics to Neo-liberalism

Because the Rehn-Meidner model allowed capitalists owning very productive and efficient firms to retain excess profits at the expense of the firms’ workers, thus exacerbating inequality, workers in these firms began to agitate for a share of the profits in the 1970s, just as women working in the state sector began to assert pressure for better wages. Meidner established a study committee that came up with a 1976 proposal that entailed transferring the excess profits into investment funds controlled by the workers in the efficient firms, with the intention that firms would create further employment and pay more workers higher wages, rather than increasing the wealth of company owners and managers.

[41] Capitalists immediately distinguished this proposal as socialism, and launched an unprecedented opposition—including calling off the class compromise established in the 1938 Saltsjöbaden Agreement.[42]

The 1980s were a very turbulent time in Sweden that initiated the occasional decline of Social Democratic Party rule. In the 1980s, pillars of Swedish industry were massively restructured. Shipbuilding was discontinued, wood pulp was integrated into modernized paper production, the steel industry was concentrated and specialized, and mechanical engineering was digitalized.[43] In 1986, one of the Social Democratic Party’s strongest champions of egalitarianism and democracy, Olof Palme was assassinated. Swedish capital was increasingly moving Swedish investment into other European countries as the European Union coalesced, and a hegemonic consensus was forming among the elite financial community: progressive taxation and pro-egalitarian redistribution became economic heresy.[44] A leading proponent of capital’s cause at the time, Social Democrat Finance Minister Kjell-Olof Feldt reminisced in an interview, “The negative inheritance I received from my predecessor Gunnar Sträng (Minister of Finance 1955 – 1976) was a strongly progressive tax system with high marginal taxes. This was supposed to bring about a just and equal society. But I eventually came to the opinion that it simply didn’t work out that way. Progressive taxes created instead a society of wranglers, cheaters, peculiar manipulations, false ambitions and new injustices. It took me at least a decade to get a part of the party to see this.”[45] With the capitalist confederation’s defection from the 1938 Saltsjöbaden Agreement and Swedish capital investing in other European countries rather than Sweden, as well as the global rise of neoliberal political-economic hegemony, the Social Democratic Party backed away from the progressive Meidner reform.[46]

The economic crisis in the 1990s has been widely cited in the Anglo-American press as a social democratic failure, but it is important to note not only did profit rates begin to fall worldwide after the 1960s,[47] also this period saw neoliberal ascendance in Social Democratic ideology and policies as well as the rise of bourgeois coalition rule in place of the Social Democrats. 1980s Social Democratic neoliberal measures—such as depressing and deregulating the currency to prop up Swedish exports during the economic restructuring transition, dropping corporate taxation and taxation on high income-earners, and switching from anti-unemployment policies to anti-inflationary policies—were exacerbated by international recession, unchecked currency speculation, and a centre-right government led by Carl Bildt (1991–1994), creating the fiscal crisis of the early 1990s.[48]

Göran Persson was a prolific Social Democratic leader, holding the office of Prime Minister for ten years

When the Social Democrats returned to power in 1994, they responded to the fiscal crisis[49] by stabilizing the currency—and by reducing the welfare state and privatizing public services and goods, as governments did in many countries influenced by Milton Friedman, the Chicago Schools of political and economic thought, and the neoliberal movement. Social Democratic Party leaders—including Göran PerssonMona Sahlin, and Anna Lindh—promoted European Union (E.U.) membership, and the Swedish referendum passed by 52–48% in favor of joining the E.U. on 14 August 1994. Bourgeois leader Lars Leijonborg at his 2007 retirement could recall the 1990s as a golden age of liberalism in which the Social Democrats were under the expanding influence of the Liberal Party and its partners in the bourgeois political coalition. Leijonborg recounted neoliberal victories such as the growth of private schooling and the proliferation of private, for-profit radio and television.[50]

 21st Century

However, many of the aspects of the social democratic welfare state continued to function at a high level, due in no small part to the high rate of unionization in Sweden, the independence of unions in wage-setting, and the exemplary competency of the feminized public sector workforce,[51] as well as widespread public support. The Social Democrats initiated studies on the effects of the neoliberal changes, and the picture that emerged from those findings allowed the party to reduce many tax expenditures, slightly increase taxes on high income-earners, and significantly reduce taxes on food. The Social Democratic Finance Minister increased spending on child support and continued to pay down the public debt.[52] By 1998 the Swedish macro-economy recovered from the 1980s industrial restructuring and the currency policy excesses.[43] At the turn of the twenty-first century, Sweden has a well-regarded, generally robust economy, and the average quality of life, after government transfers, is very high, inequality is low (the Gini coefficient is .28), and social mobility is high (compared to the affluent Anglo-American and Central European countries).[44]

The Social Democratic Party pursues environmentalist and feminist policies which promote healthful and humane conditions. Feminist policies formed and implemented by the Social Democratic Party and the Left Party and the Greens (which made an arrangement with the Social democrats to support the government, while not forming a coalition), include paid maternity and paternity leave, high employment for women in the public sector, combining flexible work with living wages and benefits, providing public support for women in their traditional responsibilities for care giving, and policies to stimulate women’s political participation and leadership. Reviewing policies and institutional practices for their impact on women had become common in social democratic governance.[53]

The legacy of Social Democratic Party governance in Sweden is widely regarded as increasing the quality of life, naturally among those who benefit directly from an affluent, low-inequality society, but even among the wealthy. One Volvo executive admitted that a strong social welfare state, like the Swedish, helps finance a quality of life that low individual taxes cannot. When faced with the question, “Why don’t you leave (Sweden)? Certainly, you would pay a lot lower taxes and probably also have a higher salary in the U.S.”, he responded, “Yes, of course, I would have a lot more money in my pocket. But I would also almost never get home before 7 o’clock and I certainly would not have the vacations everyone has a right to here… and you know what else, I would have to spend a lot more money on insurance, college for my kids, and travel back home to my family. In the end, I’m not really sure I would be any better off.”[44]
 

Hjalmar Branting accepted Eduard Bernstein‘s revision of Marxism and became a reformist socialist, advocating a peaceful transition from capitalism towards socialism. He believed that if workers were given the vote, this could be achieved by parliamentary ways. Branting supported the February Revolution in Russia in 1917. He was pro-Menshevik and defended the government of Alexander Kerensky, who he even personally visited in Petrograd.

When the October Revolution broke out the same year, Branting condemned the Bolshevik seizure of power. 1917 saw a split in the Swedish Social Democratic Party on this question, and the youth league and the revolutionary sections of the party broke away and formed the Social Democratic Left Party of Sweden, headed by Zeth Höglund. This group soon became the Swedish Communist Party. Zeth Höglund later returned to the Social Democratic Party, and wrote a two-volume biography about Hjalmar Branting.

As Prime Minister he brought Sweden into the League of Nations and was personally active as a delegate within it. When the question of whether Åland should be handed over to Sweden after the independence of Finland from Russia was brought up, he let the League of Nation decide upon the issue. He was awarded the Nobel Peace Prize in 1921 for his work in the League of Nations

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