October 21, 2006   

Sweden, Banana Republic

On September 17 the voting sheep of Sweden made an end to a very long saga: the social democratic hegemony in Swedish politics. A center-right coalition of four parties gained a majority of votes and formed a new government in the beginning of October. The potential change in politics this may lead to, however at best marginal, is welcomed by many an entrepreneur. But the new government didn’t start out setting a powerful agenda; it is more like a farce.
     Before the new government, led by somewhat conservative party leader Mr. Reinfeldt, could even present a budget, two ministers had already had to resign. The minister of trade, Ms. Borelius, was forced to resign after only eight days as minister because of harassments in the media due to the nature of her personal finances. She had committed no crime, except for hiring a nanny for her children now and then (the crime being not having paid employers “fees” of 33%).
     The real problem, as reported in the media, was the fact that she had consciously tried to avoid paying taxes through planning her deductions and investments carefully. This is no crime if you manage to comply with the thousands of rules in the tax code, but it is considered a deeply immoral thing to do by the general public. And it is an indication of the individual’s egotism and anti-solidarity, especially if rich.
     Ms. Borelius, a famous science journalist, was brought down by her former colleagues through their detailed reports on her and her family’s financial status and behavior. It took only eight days to create a public demand for her resignation too strong to handle. She asked the Prime Minister, Mr. Reinfeldt, to be resigned and was so on October 14.
     More ministers were of course investigated by the media, and they were especially tough on Ms. Cecilia Stegö Chilò, minister of culture and former CEO of libertarian-conservative think tank Timbro. She was very resolutely opposed as minister, long before the cultural politics of the new government was presented, by the left-wing intelligentsia and cultural elite. Part of the reason was her former opposition to public service television and radio--as well as her principled approach to state subsidies of culture.
     The cultural establishment claimed Ms. Stegö Chilò was the end: her ministry would mean the “death of the humanities, the death of art.” Some would not go as far but instead stated that it would take decades to revive culture when her time as minister had ended.
     It was soon discovered that Ms. Stegö Chilò had not paid the “television license” for 16 years. The “license” is a special kind of tax levied on the ownership of devices with the capability to receive television broadcasts, a scheme intended to finance state television and radio channels. The illegality of not paying taxes was not the real issue here; it was overshadowed by the fact that the minister of culture consciously did not support public service programming neither theoretically nor financially.
     Paying the license for all the 16 years just before accepting the position as minister did not save Ms. Stegö Chilò. She was forced to resign after only ten days.
     This was not, however, the end of the scandals of this government. It was discovered by journalists that more ministers in the new government had not paid the license and that they had neglected to do so for many years. The minister of integration (of immigrants), Tobias Billström, had not paid it for ten years. He has so far managed to cling to his post after having quickly paid the license and publicly declared it was but a case of civil disobedience from his ignorant youth that had “lived on” without him noticing. Billström, along with 6,500 other people (among which were a large number of members of parliament and local politicians), registered for and paid the television license that week.
     Billström was saved partly thanks to the Prime Minister stating his full support for the minister of integration, but also because the media found another and much more interesting scandal. The minister of finance, Anders E. Borg, had had his neighbor’s daughter baby-sit the children repeatedly. The former baby-sitter came forward in one of the largest newspapers, saying she was paid SEK11,500 (approximately $1,600) by Mr. Borg and his wife that one year. Borg claims he did not pay more than SEK10,000.
     The SEK1,500 ($200) may seem unimportant, but isn’t. In fact, this amount is the core of this “scoop.” The law states that you have to report any purchase of services, unless from a registered company, where the total amount of services exceeds SEK10,000 in one year. Since Mr. Borg did not report to the authorities, whether he paid SEK11,500 or SEK10,000 is most important (if you care about these things, that is).
     It seems Borg, just like Billström, manages to stay put as minister. But who knows for how long? All this happened in just the first two weeks of this newly elected government. These are interesting times.




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