Leif Pagrotsky on Swedish Social Benefits

Broad-based social support greatly reduces fear and uncertainty in the Swedish economy, Leif Pagrotsky says.
  • Transcript

TRANSCRIPT

Pagrotsky: Most countries have various programs in place for retirement, for what happens when you get sick, what happens when you get unemployed, but what is different in our system is that all of these are extremely broad based. That means that if you become unemployed, you leave one company and you take a job in another one. You do not lose your retirement benefits. In contrast, for instance, to the autoworkers in America today. If your company goes bankrupt, you can still rely on a steady stream of income to finance your food on the table, your medical bills, also when you become 80 years old. That provides a security, a safety net. That means that the fear of unemployment is not that violent. The fear of change is not that strong. And in my experience is that that makes our economy more flexible or adaptable and that there is a general sense that globalization works for the benefit of most people and for the country as a whole in spite of the fact that it brings change for many people. The burden of change is shared by all. It’s not put entirely on the shoulders of the few individuals that are affected by closures.


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