Reply #41

http://www.reuters.com/article/2012/03/21/us-sweden-inequality-idUSBRE82K0W320120321?feedType=RSS&feedName=worldNews&utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+reuters%2FworldNews+%28News+%2F+US+%2F+International%29&utm_content=Google+Reader

...Sweden has seen the steepest increase in inequality over 15 years amongst the 34 OECD nations, with disparities rising at four times the pace of the United States, the think tank said. Once the darling of the political left, heavy state control and wealth distribution through high taxes and generous benefits gave the country's have-nots an enviable standard of living at the expense of the wealthiest members of society. Although still one of the most equal countries in the world, the last two decades have seen a marked change. Market reforms have helped the economy become one of Europe's best performers but this has Swedes wondering if their love affair with state welfare was coming to an end.

The real tipping point came in 2006 when the centre-right government swept to power, bringing an end to a Social Democratic era which stretched for most of the 20th century. Swedes had grown increasingly weary of their high taxes and with more jobs going overseas, the new government laid out a plan to fine-tune the old welfare system. It slashed income taxes, sold state assets and tried to make it pay to work. Spending on welfare benefits such as pensions, unemployment and incapacity assistance has fallen by almost a third to 13 percent of GDP from the early nineties, putting Sweden only just above the 11 percent OECD average.

At the other end of the spectrum, tax changes and housing market reforms have made the rich richer. Since the mid-80s, income from savings, private pensions or rentals, jumped 10 percent for the richest fifth of the population while falling one percent for the poorest 20 percent. Critics say the changes have left many behind...Eurostat said recently that after Bulgaria, Sweden had the second biggest rise in the percentage of its population deemed at-risk-of poverty...A recent study by the National Board of Health and Welfare showed a 25 percent jump to 4,500 in the number faced with "acute" homeless situations - those who required emergency accommodation, shelter or slept outdoors - compared with 2005.

These diverging pictures of Sweden are increasingly common and are also being seen in neighboring Finland and Denmark, albeit at a slower pace. "I certainly don't think Sweden is a utopia. Sweden has become much more of a fairly normal European country," said Stefan Folster, chief economist at the Confederation of Swedish Enterprise...Some believe the latest trends in Sweden may hurt the centre-right government, especially if unemployment, running near 8 percent, remains high as the country heads towards new elections in 2014....