 I would like to start by introducing myself and then get back to why this is not going to be an ordinary speech, why it probably won't be an ordinary workshop either. I just retell what I'm going to say as a story connected to the presentation of myself. I used to be vice chairman of FMSF, an organization mentioned earlier in connection with the discussion that we had during Christian speech. I left FMSF for at least one year and have returned just a couple of weeks ago as secretary director for that. In the meantime, before I went back, I used to work for a Swedish consultant company called Ecofin, Ecofin LTD, starting out by advising businessmen and especially business organization in Sweden on political issues. We were ghost writing for anyone who has worked with ordinary, not libertarian business people. I think that you all know how very necessary it is that they have the right advices before they start writing debating articles and things like that. I was working for this company during 89 during the changes in Eastern Europe and then I also got in contact with Tom J. Palmer from the Institute of Humane Studies in Virginia. Tom Palmer had moved to Vienna at that time working in a joint venture together with Carl Manger Institute called the East-West Outreach Program. Tom and I was on the phone and we discussed one of the major problems he had when talking to people in Eastern Europe and Central Europe about what was next, what was after communism, because there was a tendency at that time to turn to a middle of the road alternative, so-called third way or the Swedish model. Sweden was regarded as an example among these people and in these countries. Tom suggested to me then that some of us in Sweden, some of the Swedish libertarians should write a collection of essays on why the Swedish model was not a model for Eastern Europe and I thought that was a good idea. So I said to Tom, we'll discuss this and I'll get back to you. Two hours later our senior consultant, our security director at the consultant company came back from a business meeting he had had with the association of free enterprise in Sweden saying that I had a meeting with his client and his client suggested to me that we should write something about the Swedish model and why the Swedish model is not a model for Eastern Europe. We should issue something that should be a warning from Sweden. I called Tom back and told him that we already got a client for this, so we're working on it. The result was this book called Rise and Decline of the Swedish Welfare State. It was written by a very good friend of mine, a very good libertarian. His name is Sven Otto Littereen. It was translated by another very good friend of mine into what, according to Henrik Baker, most of you call almost English. It was the first issue we made, Rise and Decline of the Swedish Welfare State in English. There is a Swedish copy too, but the Swedish version of this is actually worse than the English one. This was originally intended for Swedish purposes. We never thought that we, the small consultant company and the association of free enterprise in Sweden, actually would create very much in Eastern Europe. It was not the purpose of setting up either our organization or the association of free enterprise. We thought that it would gain some media attention in Sweden and the social democrats at least would not be happy about it, which is a good thing in itself. What happened was that it actually gained some attention also abroad. I spoke with Tom a while after this was published and he told me that he had gotten a lot of contacts in other countries who were immediately interested in this warning from Sweden. One year ago or almost one year ago on the day after the one year jubilee of the Czechslocking Revolution, we had the honor to present the Czech translation in Prague, which is made by Lenka Kalisova at the very newly set up liberal institute of FA Hayek in Prague, intermediated by IHS. This week, this very week, I intended to go to Budapest and stayed here instead to make a presentation of the Hungarian translation made by Giza Laszlo, who is a professor or his assistant professor at the Budapest School of Economics. The first of May, which is some sort of socialist holiday, this year I had honored to be in Romania in Sinaya outside Bucharest, together with Maria Valiano, who is also lecturer, I believe, at the Bucharest School of Economics, except for working with a lot of other things as well, being the Romanian representative of our consultant company. We presented the Romanian translation together at an IHS event. Boris Pinsker, who is working for the post-factum publishing house in Moscow, undertook to make a Russian translation. This one was printed in 10,000 copies. Boris Pinsker didn't print that many considering Russian circumstances. It would be the 30,000 copies in Russian, actually much more neatly printed than this one. Some weeks after the Russian translation was there, we received a letter from another Russian guy, who had all by himself, without our permission, made a translation of his own, asking for our permission to print it. In Bulgaria, parts of it have been published in papers issued by the Democratic Party. I don't know yet, but it might be a Bulgarian translation ready. In France, we have a translation looking for a publishing house. In South Africa, Leon Loh told me that obviously the third way the Swedish model was the official left-wing position one year ago, exactly the same as it was in Eastern Europe. He also got a couple of copies. Luckily, we didn't have to translate it in South Africa, but it might be that it's going to be a copy in Africa, and we haven't decided that yet. It was a success. The main message of this book is not something I'm going to bring up to you now, because we had a speech this morning by Otto Brams Pedersen on the very same issue. We're going to have another one tomorrow morning by John Henry Holmberg. There's no need for me to speak on the same issue once again. The basic message of this book, which is 90% libertarian, and that 100% libertarian, I would say, is that with a couple of hundred years of capitalism, or at least 100 years of some capitalism, you can afford some years or some decades of socialism. That is actually what we did in Sweden. Sweden was a fairly libertarian country in the 19th century. After the big debate during the last decades of the 19th century, we received a fairly libertarian society. This stayed on until the 20th century, when the ideas of the middle-of-world policies, when the ideas of the Swedish model actually emerged, that we stayed out of two world wars, gave us some prosperity left, and the problem was that this prosperity was used by the experimenters of the 40s and especially the 50s. That is actually what the Swedish model is all about. We've got two basic reasons for the situation today, where you all know what the Swedish model is about today. It's no drinking alcohol and it's very high taxes. That is, the first one is utopian. I would like to quote to you, it was very common among those who actually built this model. It's Alva Miedal and Gunnar Miedal, actually noble orates, both of them who wrote a book called Crisis in the Population Question. Taking care of infants is the most laborious, impersonal and technically most demanding stage of child raising. It is therefore highly suitable for being taken care of by experts, saying the government. This was a very common opinion among those who built the Swedish welfare state at that time. It's not anymore. And the reason that the Swedish model has stayed on for so long and the reason it turned into what we've got today with very high tax pressure and everything. It's not actually the utopians of the 40s and the 40s. It is a pure public choice. That is that all these prosperity in the hands of the government gave an opportunity for the interest groups to try to build out the welfare state in their own areas, which also happened. One of the Swedish experts on the Swedish model, Nils Carlson, who is PhD student, I think we should call him, said that the Swedish welfare state is actually a result of unintended, it's an unintended consequence, probably, because no one would have been so stupid as to think it out in the first place. So my main problem working with this book now and still trying to find a publishing house in France and other places is that I don't know if the third way is still the official left-wing position. If it still is interesting for the countries in Eastern and Central Europe, I mean it would be very convenient to say that used to be two years ago that we published this book, it's not anymore. I don't think it is that way. And my second question in this is, if it still is, what should we do about it? Is publishing a book like this a good thing to do, or is it something else we should do to try to avoid the problem of falling into the same trap as Sweden has fallen into, which we do both in countries in Eastern and Central Europe and countries like South Africa, where this problem is obviously still existing? That's all I had to say. And now it's your turn for discussion. Thank you very much. I'm going to move down here now. Okay? I still got many more copies left in Sweden. So anyone who hasn't yet read it and would like a copy, please give me a disc inscribed or write down your name or something, and I'll send one. Okay? Tom? Yes, and would you like to discuss if there was one particular policy that was introduced in Sweden that was very damaging? Could you discuss what that policy is, what the arguments and favor of that policy were, and some alternative or more libertarian solutions to the problems that are being supposedly solved by that policy? The worst problem in Sweden society is the tax ratio. I think we all can agree on that. The reason for raising taxes, we all know, that's financing governmental activities. I mean, we all know about the mechanisms of raising taxes. If I'm supposed to pick one specific example, I would say it's the housing policy, which is very, very obvious that governmental policies have failed. And the reason behind the Swedish housing policy was actually, from the beginning, war laws. During the war, special laws, of course, were introduced, and then they remained after the war. It's very easy to isolate an issue like that. This is obviously very, very wrong, and it's possible to make isolated changes in the special area. I would select the housing policy, yes. What were the arguments used in the debate of the housing policy after the war? I don't use this. I mean, everyone should have an appointment. One of the main arguments for the remaining week of the housing policy of the war was that it seemed to work during the war. That's why it's difficult to reflect that we see the way out. I mean, there are some interesting rules on sitting to defend what they could get from the people they represent. But how to change the system? Is the solution a big crisis, or is the solution to a big crisis to attack? So are there a lot of problems after we tackle them one after the other? I actually don't know. I mean, when I'm pessimistic, I think it's the first solution. When I'm optimistic, I think it's the second solution. I think that a realistic perspective for the 10 years to come is that the countries of Eastern Europe will be much better off than Sweden, because there we've got some sort of unity around what direction to take. In Sweden, a lot of people still tend to think that it's working and it's not. So I think that maybe in 10 years or so, Sweden will be the most socialistic country in Europe. All right, then maybe people will start to realize what has actually happened and what to do about it. On the other hand, I would like to say the same thing as I did in the discussion with Christian earlier today, that the minds of people actually have changed and they have changed in Czechoslovakia, they have changed the United States and in Sweden. So everyone is actually advocating liberty today. The problem with Sweden is the implementation in real politics. I don't know if one could say the same thing about the other Scandinavian countries. Sweden is the worst one. I saw a television program from Sweden yesterday, or today's program. It was about the election in Sweden. It was the chairman of the New Pact. The Sweden was interviewed. The generalist asked the chairman of the New Pact but is it possible for you to give any examples of any countries who have reduced their taxes as much as you suggested that we should be doing Sweden and couldn't give any examples. So the generalist seemed that they were not convinced that it would be possible at all. But do you think that by any chance it would be possible to convince Swedish people that it would be possible to reduce or remove or eliminate the Swedish model at all? I don't know. I think that the membership of Sweden in the EEC is actually something that is going to give a good result. I fully understand the British group because relatively EEC seems to be socialistic from a British point of view. In Sweden, the EEC would mean at least 15% lower tax pressure and a lot of liberal reforms like that because we are much worse off than a general country in the EEC. Joining the EEC means, at least in people's minds, to some extent abandoning the Swedish model, too. I think that is a very important step in the long run, I don't know. Yes, sir? Pardon? European socialism is much better than Swedish socialism relatively because it is not as socialistic from my point of view. A lot of people who built the Swedish welfare state, which we are involved in believe that Sweden was the chosen country. Let me give you another quote from the Medals in the population question. As a result of historical coincidence, the Scandinavian countries, especially Sweden, offer the best imaginable preconditions for an audacious experiment in democratic socialism. Why do they believe that? I don't know. Sweden was actually the chosen country for this experiment just as was Soviet Russia for communism. Was that sort of thinking that lay behind what actually happened in Sweden? You told us that the Swedish society was more or less libertarian in the 19th century. I'm just wondering, I don't understand, what made it change Sweden to switch model in this nowadays? What was the reason why the libertarian model, let's say, didn't go on and change towards what it is nowadays? Basically two reasons, I would say, and I think that's probably called Fredrik and Fredrik, my dad, something. The first reason was that after the two world wars, as I told you, we had a lot of wealth preserved as we didn't participate in these wars. Normally we say that a war creates more governmental intervention. In Sweden I would say was, on the contrary, there was a lot of money left for the politicians to use. It was very easy to start experimenting. The reason that this really changed over the long run was that we had one single party remaining in power for over 40 years, named the Social Democrats. If you change the political majority every third or every six years, it's very hard to build up something that remains in Sweden. We didn't have that problem. We had basically one party system for 40 years, and 40 years is a very long time to build your own sort of system. I would say that is one of the reasons. I don't know if you've got other reasons to add. Well, the changes for the wife, as I said, is called left to the left. It was in line with the international development, I think. The changes didn't go all over the world. They were more extreme in Sweden, but it was always in line with the changes all over the world. I have three related questions. Firstly, what percentage of your economy is in the government sector? Secondly, is that still growing? And thirdly, do Swedish socialists claim that it should grow more and that the problems to proceed problems is more state intervention? We're talking about state intervention. The Swedish model is actually a system of letting capitalism work in one area. We have got very much of big government and big business going together in Sweden. And that has stayed on. And I don't think that the social democrats or even the communists think it would be a very clever idea to socialize big business. What we have got, though, is a growing share of governmental owning in the companies. For the last 10 years, the governmental share of the total stock market value has increased from 3% to 10% is the value today. And we have got very, very bad plans on the governmental table today, especially endorsed by the blue-collar union to extend this further. So the obvious share is not that large. The social democrats would like to extend it. That's my answer to your question. You had a second question in between these two. Yeah, has it been growing through the entities? Yes, it has. The 80s is actually when it has been growing. They would say that the solution to the housing problem is more taxes, more spending on public housing? Right. I mean, the problem today is you've got almost no private savings at all in Sweden. The government's solution to this is make it even harder to save privately and increase the governmental savings. That's socialism. Anyone else? If not, thank you very much for your attention. And we move on to the dollar workshop.