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Dimitrus Tsarouhas- Social Democracy in Sweden SOCIAL DEMOCRACY IN SWEDEN Dimitris Tsarouhas is Assistant Professor at the Department of International Relations, Bilkent University, Turkey. He has published on labour politics and social partnership, comparative social policy and Europeanization. SOCIAL DEMOCRACY IN SWEDEN The Threat from a Globalized World DIMITRIS TSAROUHAS Tauris Academic Studies LONDON • NEW YORK Published in 2008 by Tauris Academic Studies, an imprint of I.B. Tauris & Co Ltd 6 Salem Road, London W2 4BU 175 Fifth Avenue, New York NY 10010 www.ibtauris.com In the United States of America and in Canada distributed by Palgrave Macmillan a division of St Martins Press, 175 Fifth Avenue, New York NY 10010 Copyright © 2008 Dimitris Tsarouhas The right of Dimitris Tsarouhas to be identified as the author of this work has been asserted by the author in accordance with the Copyright, Designs and Patent Act 1988. All rights reserved. Except for brief quotations in a review, this book, or any part thereof, may not be reproduced, stored in or introduced into a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, without the prior written permission of the publisher. Library of European Studies 6 ISBN: 978 1 84511 786 3 A full CIP record for this book is available from the British Library A full CIP record for this book is available from the Library of Congress Library of Congress Catalog Card Number: available Printed and bound in India by Thomson Press from camera-ready copy supplied by Oxford Publishing Services Contents List of Tables and Figures vi Acronyms and Abbreviations vii Note on Transliteration x Acknowledgements xi 1. Introduction 1 2. The Growth Years 31 3. Decline: Labour Radicalism 62 4. Demise: Employers’ Radicalism 87 5. Globalization and Europeanization 118 6. The New Swedish Model 141 7. Conclusion 189 Notes and References 201 Bibliography 239 Index 267 List of Tables and Figures Tables 4.1 Union growth rates, percentage of union density 91 4.2 Union membership, growth by Confederation, in percentage 91 4.3 Union membership in thousands, 1950–1980 91 4.4 Public government outlays, percentage of GDP 93 5.1 Percentage of total Swedish foreign sales produced abroad, 1965–1990 120 5.2 Marginal tax rates on labour 122 Figures 6.1 Number of strikes in Sweden, 1985–2006 154 6.2 Strikes and lockouts in Sweden, days lost, 1985–2006 154 6.3 Lost working days as a result of labour conflicts in the EU, 1990–2000 162 6.4 Low-paid employees, selected countries 172 6.5 Wage dispersion, selected countries, 2003 173 6.6 Taxation levels, 1980–2000 186 Acronyms and Abbreviations ABF (Arbetarnas Bildningsförbund) Workers’ Educational Association AMK (Arbetsmarknadskommission) Labour Market Commission AMS (Arbetsmarknadsstyrelsen) Labour Market Board ATP (Allmänn Tilläggs Pension) Universal Supplementary Pension Scheme BI (Sveriges Byggindustrier) Construction Employers’ Association CF (Civilingenjörsförbundet) Swedish Association of Graduate Engineers CMEs Coordinated market economies ECJ European Court of Justice EMU Economic and Monetary Union EP European Parliament ERT European Round Table of Industrialists ESPRIT European Strategic Programme for Research and Development in Information Technology ETUC European Trade Union Confederation EVCA European Venture Capital Association FDI Foreign direct investment GDP Gross domestic product HI Historical institutionalism IA Industrial Agreement Kommunal (Kommunalsarbetareförbundet) Municipal Workers’ Union LAS (Lagen om Anställningsskkydd) The Security of Employment Act LF (Svenska Landstingsförbundet) Swedish Association of County Councils LMEs Liberal market economies viii SOCIAL DEMOCRACY IN SWEDEN LO (Landsorganisationen i Sverige) Swedish Trade Union Confederation MBL (Medbestämmandelagen) Co-Determination Act MEP Member of the European Parliament Metall (Metallarbetareförbundet) Metal Workers’ Union NÄFO (Näringslivets fond) Swedish Free Enterprise Foundation NÄSO (Näringslivets Sammanfogning) Joint Committee for Private Commerce and Industry OECD Organization for Economic Cooperation and Development PPP Purchase power parity PTK (Privattjänstemannakartellen) Council for Negotiation and Co-operation R&D Research and development SAC Central Organization of Swedish Workers SACO (Sveriges Akademikers Centralroganisation) Swedish Confederation of Professional Associations SAF (Svenska arbetsgivareföreningen), Swedish Employers’ Confederation SAP Swedish Social Democratic Party (Sveriges socialdemokratiska arbetarepartiet) SAV (Statens Arbetsgivarverk) National Agency for Public Employers SEA Single European Act SGP Stability and Growth Pact SIF (Svenska Industritjänstemannaförbundet) Swedish Union of Clerical and Technical Employees in Industry SIFO (Svenska Institutet för Opinionsundersökningar) Swedish Institute for Opinion Research SFN (Stiftelsen Fritt Näringsliv) Swedish Free Enterprise Foundation SK (Svenska Kommunförbundet) Swedish Association for Local Authorities SKAF Municipal Workers’ Union (see Kommunal) ACRONYMS AND ABBREVIATIONS ix SNS (Studieförbundet Näringsliv och Samhället) Centre for Business and Policy Studies Statsföretag AB State Enterprise Corporation TCO (Tjänstemännens Centralorganization) Swedish Confederation of Professional Employees TNC(s) Transnational Corporation(s) TTR Total tax receipts UNICE (Union des Industries de la Communauté européenne) Union of Industrial and Employers’ Confederations of Europe VAT Value added tax VF (Verkstadsföreningen) Association of Swedish Engineering Industries VoC Varieties of Capitalism VPK (Vänsterpartiet Kommunisterna) Left Party (Communist) Note on Transliteration Swedish words have been translated into English in line with Norstedts Dictionary, Clays – England 2001 and according to the Collins English Dictionary (3rd edition), Random House Webster’s College Dictionary, Longman Pronunciation Dictionary and Norstedts Swedish Dictionary (2nd edition, 1988). All Swedish abbreviations are given in full in the main body of the text and then translated into English to facilitate the flow of the text. The bibliography’s alphabetical order follows the English rather than the Swedish alphabetical order to facilitate the search of authors for the English-speaking reader. Acknowledgements Many people have assisted the research that led to this book and I wish to mention a few of them as a sign of appreciation. The professionalism and encouragement of I.B.Tauris made things easier for me, and Allison McKechnie’s copy-editing proved very useful indeed. I also wish to thank Oxford Publishing Services for making sure that the final product is as orderly as I could never have imagined. The book would not have been possible without the help and cooperation of staff at the Labour Movement’s Archive and Library in Stockholm. I wish to single out Stellan Andersson for his help in accessing the archives of Olof Palme and Ingvar Carlsson. Immense thanks are due to Steve Ludlam who helped me throughout the thesis version of this book with patience and understanding. Andrew Gamble has supported this endeavour from day one. He has inspired a lot of thoughts generated through the course of this study. The University of Sheffield academic and administrative staff has provided the ideal environment for my work. Special thanks are due to Sarah Cooke for her efficiency and support. Mark Wickham Jones has also supported this book from its inception. A lot of the arguments herein are due to his provoking questions and thoughtful remarks. Grateful thanks are also due to Eva Berndtsson at the University of Sheffield who made sure that the language barrier became less of a problem, and Ulf Mörkenstam at Stockholm University who facilitated my visit there. I would also like to thank my interviewees for their patience and the wealth of information they shared with me. Jenny Andersson and Urban Lundberg have helped me clarify some of my thoughts on Swedish social democracy. Needless to say, the responsibility for the arguments developed in this book is solely my own. My parents, Nikiforos and Sylvia, and my sister Nicole have xii SOCIAL DEMOCRACY IN SWEDEN been tireless companions throughout my life. Their encouragement made my work so much easier and I hope they know how much I owe to them. My parents-in-law, Gülen and Erciyes Özdemir, and my sister-in-law, Ilgin Özdemir, have done a great deal to facilitate my new life in Turkey over the last few years. I wish to herewith thank them for their kind-heartedness, considering that professional work is inevitably intertwined with personal circumstances. Finally, I hope that my wife will forgive me for evoking this book’s main arguments and ideas in almost all of our conversations over the last few years. Without her understanding and support this book would have hardly reached publication stage. This is why it is dedicated to Umut, with all my love. Ankara, July 2007 1 Introduction Social democracy is in crisis. There is nothing new about this statement, considering how often such a crisis has been diagnosed in the past.1 It would seem, however, that at the beginning of the twenty-first century the inability of social democrats to cope with a fast-changing economic reality has imprisoned them in a world of limited political ambition. This is paradoxical considering how social democrats responded to earlier challenges. Prophecies of decline had earlier stressed the shrinking of the manual working class – the traditional constituency of the left – as well as the
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