By Courtney Suciu
In 1932, Per Albin Hansson was named Premier of Sweden. It was a tumultuous time in the country and around the world. Economic crises, the Soviet Ukrainian Holodomor (man-made famine) and Hitler’s rise to power in Germany were contributing factors to, and indicators of, global insecurity and uncertainty.
Could the solution to these difficulties be found in capitalist free-enterprise and private, for-profit industry and trade? Or in the spread of communist collectivism and the common ownership of wealth and property?
As international conflict arose between these seemingly opposing political philosophies, Hansson, the leader of the Socialist-Democratic Party (or SAP), introduced an alternative system for Sweden: folkhemmet, or “the people’s home,” which would prioritize the health and well-being, as well as the autonomy and individualism, of Swedish citizens by maintaining a mixed market economy.
This socio-economic experiment would have a profound impact around the world, influencing U.S. New Deal politics and creating a legacy in Scandinavian social-welfare efforts.
U.S. journalist Marquis Childs called folkhemmet “The Middle Way” in his hugely influential 1936 book of the same name. “Sweden’s middle way between collectivism and free enterprise is actually not a system that combines features of both in varying ways,” wrote Simeon Strunsky of The New York Times1 in a piece about the book.
“It is really the co-existence of the two things side-by-side in varying proportion in different fields,” he explained. As the result of this co-existence, “Sweden has prospered and has remained a democracy.”
Under Sweden’s unique system, privately-held, for-profit industries and public agencies successfully operated in parallel. Making money was good, but public competition, either through producer or state cooperatives, “beat down unreasonable profits,” according to Strunsky. In Stockholm, housing for the working class was provided with funding from the city and was built by the families who would be living in them.
As Hansson’s socio-economic experiment thrived, President Franklin Roosevelt was in the midst of implementing New Deal programs in the U.S. designed to help the nation recover from the Great Depression. In Childs’s account of “the middle way,” Roosevelt sought solutions to the American economic crisis, according to Josiah R. Baker’s dissertation Constructing the People's home: The Political and Economic Origins and Early Development of the “Swedish Model”2, and in 1936, inspired by Childs’s book, he launched a commission to study the Swedish system.
Roosevelt’s press conference announcing this endeavor, and essentially his endorsement of Childs’s book, “proved to be a critical juncture in how American academics and scholars view Sweden throughout much of the remainder of the 20th century,” Baker wrote. Leftists in the U.S. have clung to “visions of harmoniously integrated socialism and capitalism” while the right has “sought to prevent a cradle-to-grave social welfare state and has used the image of Swedish socialism as something to prevent.”
During Roosevelt’s 1936 reelection campaign, the American right was already – and in no uncertain terms – vehemently expressing their opposition to the president’s socialist-inspired efforts to “beat down” excessive wealth and develop programs for the poor and working classes.
Childs joined Roosevelt on the campaign trail and reported observations in such publications as Harper’s Magazine3 which ran his story “They Hate Roosevelt.” He detailed the rage that “permeate[d], in greater or lesser degree, the whole upper stratum of American society” toward the president.
The animosity of the “leisure class” was largely in response to the New Deal and a “widespread conviction among the wealthy that they are being butchered to make a Roman Holiday for the less fortunate,” Childs wrote.
But it wasn’t just the rich who were passionately opposed to Roosevelt. In a follow up article, “But I, Too, Hate Roosevelt,”4 Robert Hale, a Republican running for Congress in Maine, explained he “earned money in a modest way” and that his family “lives by the sweat of our brow.” Still, he wondered “which list I am on. Am I, with my industry and my debts, destined for the lifting up process, or am I, because I have earned more than the minimum necessary for my survival, on the weeding-out list?”
Meanwhile, as American voters were divided about whether programs like social security were viable, the U.S. Minister to Sweden, Fred Morris Dearing, reported5 that “Sweden is enjoying extraordinary material prosperity.” While it seemed like the Scandinavian country had created a utopian system, Swedes also expressed concerns about limitations on capitalist free-enterprise.
Dearing explained that many of those with whom he spoke hoped that:
the Government will not become too socialistic and that more enterprising men and concerns will be left in comparative freedom so they can amass the capital to finance new activities in order to provide employment for people, to better living conditions and to promote continued expansion of Swedish properties.
Among those interviewed for Dearing’s report was the Swedish entrepreneur Axel Wenner-Gren, one of the world’s richest men during the 1930s, who had just donated the equivalent of seven and half million dollars “for a research institute to promote social and industrial welfare in the Northern countries.”
Dearing provided this background on Wenner-Gren’s financial situation:
I hear on this side that at one time the combined American and Swedish taxes on his income exceeded its total and that it was only by special arrangements with the Swedish Government which took the view that it would be undesirable to stifle his enterprises that he was able to keep some of his money. Even then, I am told, he to pay some 88 per cent in taxes.
Wenner-Gren must have been crazy rich if, despite paying 88 percent in taxes, he still had nearly 8 million in 1936 dollars to donate to a social welfare program. Regardless, Dearing’s report presented an interesting contrast between the concerns of Swedish capitalists who claimed to be less worried that socialism would bankrupt them than prevent them from controlling their money in a way that would benefit society at large, and American capitalists like Hale, who “ask[ed] for a show of hands on those who can define the distinction between a property right and a human right.”
Would American individualism make it impossible for socialist programs and practices to succeed in the U.S.?
Many experts over time have argued that the success of Sweden’s “middle way” had less to do with its mixed market economy and more to do with Scandinavian culture. Perhaps the coexistence of collectivism and free enterprise worked in Sweden because of the “special traits of the Swedish people” and their “patience and caution and subordination of the individual to the common good,” as Strunsky proposed.
The Socialist-Democratic Party remained in power 44 years until voted out in 1976 by a center-right coalition, according to Steven Kelman’s 1980 article “The Souring of Sweden”6 which focused on Childs’s follow-up book about the Swedish government, “ominously subtitled” The Middle Way on Trial.
Kelman noted that “since 1976, Sweden has gone through a stormy period,” including bankruptcies, public disillusionment with reform, debate over nuclear power and an increasingly powerful Conservative Party.
“The War of the Roses” – “a sometimes fierce ideological battle within the Social Democratic Party” – waged through the 1980s, wrote Goran Rosenberg in his article “Folkhemmet,”7 for the journal OpenDemocracy. The party’s right wing advocated for an overhaul of the welfare state and experimented with deregulation and free-market policies; while the left-leaning “traditionalists” sought to preserve the welfare state and limit the privatization of public goods, he explained.
According to Rosenberg, one of the most unique ways Sweden’s sociopolitical turmoil manifested was in the grisly Scandinavian crime novels that dominated bestseller lists around the world in the 1990s, such as the Lisbeth Salander books by Stieg Larsson, or the series featuring police superintendent Kurt Wallander by Swedish author Henning Mankell.
Rosenberg explained how Mankell, “a self-confessed supporter of the radical left,” used his protagonist to “represent his own disillusionment with the retreat from the ideals of folkhemmet.” “The increasingly depressed Kurt Wallander is given many reasons and ample opportunities to mourn the good society which he once knew and which is now falling apart before his eyes,” he wrote, noting how “the personal depression of Kurt Wallender becomes inseparable from his mourning of the Swedish welfare state.”
Ultimately, Rosenberg argued, “what has been conveyed [in these novels] is the image of Sweden losing its bearing and mores and becoming a society like all others.”
So, if Swedish society was like all others, what about the “special traits of the Swedish people”?
Well, it turns out, in many cases, their patience and pragmatism persevered. At least in Gothenburg, where a city-wide program has been implemented “to mix social classes, genders and ethnicities to make Sweden’s second city a more equal place to live,” David Crouch wrote in a 2017 article for The Guardian8.
The city’s efforts reflected a nationwide trend that launched in 2014 “with the election of a center-left coalitional of the Social Democrats with the Green Party,” Couch wrote, “which set out to reverse ‘irresponsible tax cuts.’”
“Helped by a booming economy, the coalition has increased benefits for unemployment, sickness and families with children, raised income tax on the better off and tried to increase taxes on banks, aviation and dividends,” he continued.
It will be interesting to see what kind of influence this “new ‘people’s home’” will have around the world, especially on nations continuing the struggle to balance free-enterprise and social welfare.
Courtney Suciu is ProQuest’s lead blog writer. Her loves include libraries, literacy and researching extraordinary stories related to the arts and humanities. She has a Master’s Degree in English literature and a background in teaching, journalism and marketing. Follow her @QuirkySuciu