Evening star., 1948-09-19

IS desperately SnOIL OI Qolldis allu
import restrictions must be dras-
so heavily into internal production
that output originally earmarked
for export actually went into home
consumption, with resultant short
ages in foreign exchange.
Swedish planning for the post
war era, was Observation-Disclosures
ately, it now is known-by the BELIEF
that the United States promptly
would encounter a severe depres-
sion.
The economist, Gunnar Myrdal,
later minister Of trade, sponsored
this line of thought.
At the same time, labor party
leaders believed that Europe would
recover much more rapidly than it
actually has.
Sweden, consequently, tried to
ride at the top of the market, and
did-until purchaser resistance in
tervened.
Living Standard Kept High
In line with a policy beamed at
economic depression in the United
States. Sweden hoped to export
more to Europe and thus have more
foreign exchange with which to buy
in the United States.
Failure of the Myrdal- school pre-
dictions added to the plight here.
And still the labor party leaders
failed to drain of the excessive in
ternal buying power.
They lacked the courage to strike
at the standard Of living and get
1t down to a reasonable level in
world economy torn by war. That
would have meant the danger Of
political reprisals and the social
democrats would not take the risk.
1t is not fair to condemn the
social democrats blindly. They
have done many fine, wholesome
things for the Swedish people, and
for the world.
Something like billion crowns
(roughly billion dollars was ex-
tended after the war in credits,
loans and outright gifts to less
fortunate countries.
Many increased benefits in social
ization have been effective, improv-
ing the lot Of the average man.
But, in something Of an over
these same leaders.
notably Ernst Wigforss, minister Of
finance, Gustav Moeller, minister of
social welfare, and Tage Erlander.
prime minister, tried to keep up the
high standard Of living despite the
realities Of changing world.
They may yet save Sweden from
disaster. But 1t will be a little less
than miracle II they can prevent
drastic reduction in Swedens
standard Of living this winter.
Dollar Reserve Low
Sweden Is down to rock bottom
in its reserves Of foreign exchange.
Without getting overwhelmed in
statistical mazes, 1t means, In a
word, that Sweden has practically
no American dollars available, only
total less than s20,O00,00O, which
Is required to keep the crown on
its feet.
Sweden already has been forced
to reduce Its imports drastically
especially in American exports.
Plans for the last half of 1948
call for a 10 per cent reduction in
the estimated imports. For this
period, imports from the United
States are estimated at 180,000,000
crowns, Of which 75,000,o will be
for petroleum and 100000 for
coke.
Sweden Cor, more accurately, the
social democrats who control Swed-
en- will not cut down the excessive
purchasing power which Is so OBJ
vlously one cause Of the economic
troubles here.
No politician dares, or has ever
really dared, to risk reprisals at the
hands Of an electorate whose income
index is practically rs per cent above
the cost Of living.
Few Controls Effective
The loss of trade with Germany
hit Sweden a terrific postwar blow.
especially when poor guesses about
an American depression and q quick
European recovery dismally upset
plans for Sweden's postwar econo-
my.
They geared themselves In the
wrong direction and thus failed to
bring down the Swedish standard
of living.
The labor party failed to control
the surplus of Swedish buying power,
thus allowing internal consumption
Of products that should have gone
into the export market.
Controls have increased TO the
point of bewilderment but, amid the
exigencies Of an election year. only
30 or 40 per cent Of these controls
appear effective.
Furthermore, some OF these con-
trolls are being kept deliberately
lighter than they should be.
Remedies May Come Soon
Nothing, Of course, is going to be
done until after the general elec-
ton and the Social Democrats know
where they stand.
II they hold their present strength.
slightly under 50 per cent of the
last popular vote and exactly hsh
of the 230 seats in the Riksdag
lower chamber, they may dare to
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