Echoes of Clinton in Social Democrats' welfare reform bid

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Echoes of Clinton in Social Democrats' welfare reform bid
Are the Social Democrats trying to emulate US President Bill Clinton, who signed sweeping welfare reform legislation in 1996? File photo: AP

The Social Democrats have proposed major changes to Sweden's welfare system, a move that reminds liberal commentator Nima Sanandaji of reforms enacted by former US President Bill Clinton.


In my last column, I discussed the difficulties of distinguishing between right and left in Sweden’s election politics, at least when it comes to the Social Democrats. The example I used is how the party recently promised to cut the scope of the Swedish central government by 10 billion kronor ($1.5 billion). But it doesn’t stop there. The Social Democrats have gone from challenging the scope of government bureaucracy to criticizing overutilization of the social safety net.

The Social Democrats in the capital region of Stockholm recently published a "Contract for the future – for the Stockholm region". The first of four points is entitled: "No one who can work should be on social security". The Dagens Nyheter (DN) newspaper reported that, on the national level, the party has gone even further. A new goal is to sign an “education contract” with those under 25-years-old who have not completed their studies. According to DN, "Those who are not ready to fulfill their studies according to an individual study plan will not be granted social security".

This idea, put forth by former Social Democratic school minister Ibrahim Baylan, was rapidly attacked by the left. Daniel Suhonen, president for the left-leaning think tank Katalys and himself a Social Democrat, criticized the proposal as being "very right-wing".

Of course, the Social Democrats do not simply want to put pressure on youth who depend on social security; they also want to direct various forms of aid to help these individuals succeed to attain their upper-secondary school degrees. The idea seems to be to connect public handouts to a requirement that young people participate in education programmes. And presumably, exceptions will be made for those who, for various reasons, cannot be expected to participate.

We shouldn’t be surprised if the Social Democrats eventually retract their proposal, or at least clarify it, in the wake of initial criticism. And many question if the party really wants to introduce such a welfare reform, as it goes against the idea that basic safety nets be granted to all, regardless of their individual behavior.

But should we really be surprised? In the United States, the  “Personal Responsibility and Work Opportunity Act”, which marked a fundamental shift in both the methods and goals of federal cash assistance to the poor in the US, was supported by the Republicans but signed into law by Democrat Bill Clinton in 1996.

Changing the fundamentals of social security might, if implemented correctly, retain basic safety nets while reducing the risk of long-term welfare dependency. Most likely, the Social Democrats are striving towards this goal. And like Bill Clinton, they might have a better chance of actually implementing such a change than a center-right government. As the famous saying goes, “only Nixon could go to China”.

It might seem as a shock that Swedish Social Democrats would go so far in challenging generous public benefits. But then again, in neighboring Denmark, which has an ever bigger welfare state, this has been a common practice during the latest few years. Social Democrat Finance Minister Bjarne Corydon last year explained: “If we are to ensure support for the welfare state, we must focus on the quality of public services rather than transfer payments”.

Of course, these ideas can be seen as a way of winning over centrist voters during the election campaign. And they likely have limited support within the party ranks. But they are, nevertheless, put forth by leading Social Democrats. This shift seems very similar to the move towards the center by the Moderates, as they begun morphing into the “New Moderates” in 2005.

An important issue in the upcoming election, of course, is how this new line in Social Democrat policy sits with the left-wing of the labour movement. And for that matter, if the left parties win the election, how will the Social Democrats co-operate with the Left Party, where radical left ideas are still prominent and welfare reform isn't even on the agenda? The only thing that is clear is that Social Democrat party leader Stefan Löfven really wants to make the distinction between right and left in Swedish politics even more difficult. 

Dr. Nima Sanandaji, a Swedish writer of Kurdish origin, has written numerous books and reports about policy issues in Sweden. He is a regular contributor to The Local.


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