Wednesday, 25 April 2007

Log-rolling still a priority

The liberal-conservative-centrist-christian democrat governing coalition has declared that Jobs, Jobs, and Jobs are it's greatest priority.

But in spite of that, few reforms have been launched. The fenomenal GDP growth and modest rise in jobs we are experiencing right now – not seen since the late 1960's – is mainly due to the international economic cycle, after all.

It is therefore not surprising that one of todays leading political news stories is about the Christian Democrat's pet project: cash subsidies to parents who choose to stay at home with the kids.

The Swedish Welfare State provides virtually free daycare from a very early age. This is financed by the 30 percent tax the local municipality levies on all income (as is also the care, housing and medicare for the elderly).

But in return, every child taken care of, frees lots of productivity as it lets both parents hold a job. Thus, a "dagisfröken" i.e. a woman (or man) working at the local crib is a major player in the relatively high level of productivity of the Swedish economy. That is what I would call Value for the tax-dollar (or Krona, the currency of the Realm).

Thus this "reform" of funding housewives with tax money is hardly liberal, nor adding to the nation's productivity. The only reason it is tolerated by the other governing partners is of course the log-rolling nature of the political decision process in any coalition government. That very same process has also led to legislation allowing taxpayers to deduct costs for low-productivity "domestic services". The long detailed list provided by the government determining what those domestic services really consists of beats many of the ridiculously detalied regulations of our private lives that the ousted social democratic governement used to excel at.

Meanwhile, out there in the wilderness, more than one million swedes still dwell outside the proper labour market. A disproportional part of those are immigrants, young people and women over 50, all who still wait for the nwesly installed gevernment to start doing things.

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