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The 20th century
During the 20th century, Sweden developed into a modern welfare state. This was made possible by a favourable political and economic development in the Nordic countries. From the late 19th century, the Nordic countries developed from agrarian societies to fully industrialised societies. Parallel with economic development, democratic institutions and parlamentarism were introduced.
In 1865, the Diet of the Four Estates was abolished and replaced with the two- chamber parliament. The election to the second chamber took place through universal elections. At this time, only members of a certain economic elite had the right to vote. This, of course, created discontent, mainly among liberal and social democratic groups. Among the conservatives were groups who strongly opposed a democratisation, but there were also more pragmatic and realistic groups who realised that democratic reforms were necessary.
The introduction of parlamentarism took place during the first decade of the 20th century in Sweden. In 1907 a voting reform was signed and the universal right to vote gain legal force, but only for men. The reform was however a compromise and only the beginning of democratisation. The three important political groupings at this time were the Social Democrats, the Liberals and the Conservatives.
The discrepancy in the political development in the Nordic countries, with Norway as democratic forerunner, put political strain on the union between the Sweden and Norway. The situation became quite serious before the dissolution of the union in 1905.
During the period from 1900 to the outbreak of World War I, parlamentarism had become praxis in Sweden. Earlier, the king decided who was going to form the government after an election. Now, he usually accepted the choice of the parliament.
World War I
In 1914 war broke out. Sweden declared itself neutral. However, important groups in society, for instance many officers and public servants, sympathized with Germany and the Swedish Social Democratic Party had a good relationship with its German counterpart. This situation changed during the war and Liberals and Social Democrats began to sympathize with England. Officially all parties in the parliament supported the neutrality policy and the political differences were put aside for most of the war. Sweden remained neutral throughout the war.
During the first years of the war, Sweden exported large quantities of food to Germany. But at the same time import was made more difficult because of blockades upheld by the belligerents. This caused maintenance problems. In 1917 the harvest failed which, in combination with the decline of import, almost caused a famine. This, however, was avoided thanks to an agreement with the Allies, which allowed Sweden to import food and supplies.
The Russian Revolution in 1917 shook Sweden as much as it did the rest of Europe. The war and hard times constituted a fertile breeding-ground for the Communists. As it had in Russia, communist propaganda had spread among the soldiers at war in some regiments. In Sweden, however, this did not lead to revolution. A fraction of the left wing of the Social Democratic Party formed what was later to become the Swedish Communist Party.
The election to the second chamber in 1917 was won by the Social Democrats and the Liberals. They wanted to speed up the democratisation of the parliamentarian system. The king was still reluctant and tried to slow down the process by appointing prime ministers who formed governments that were opposed to reforms. These governments were, of course, weak and lacked support. This finally led to the formation of a Liberal/Social Democratic government. The new Government soon decided to implement a constitutional reform, towards universal suffrage. Women were finally allowed to vote for the first time in the elections of 1921.
Between the wars
During the first years of the twenties, Sweden, like the rest of Europe was seriously affected by the Depression. The latter part of the decade was characterised by an economic boom. In spite of these economic fluctuations, the industrialisation and modernisation of Swedish society continued. Industrial production rose more and more, thanks to rationalisations and the use of modern techniques. During the period 1925-29, the industrial production rose by 35 %. Urbanisation continued and the cities and their populations grew. The number of people that worked with farming, on the other hand, diminished.
The Depression and the difficult economic situation resulted in nine governments in 13 years between 1920-33. In the election of 1921 the Conservatives were supported by approximately 25% of the vote. They concentrated on questions concerning the economy and defence. They also warned people about the Social Democrats, using the situation in Russia as an example. The Liberals and the agrarian parties fared poorly in the election. The Social Democrats, on the other hand, received 36% of the vote. Their leader, Hjalmar Branding, was a supporter of the League of Nations and believed in its capability to solve international crises. This led to a decision in 1925 to extensively reduce Swedish military expenditure. Another important question for the Social Democrats was the education system. This was believed to be fundamental in order to combat class differences. Also during this period, the unions grew stronger and became an important power factor in society.
Now the "Swedish model" was introduced. In 1932, the Social Democrats, because of the high unemployment-rate, formed a new policy. The unemployed should be provided with meaningful jobs by the State. This would vitalise the economy and create new jobs, all in the spirit of Meynard Keynes. This, of course, meant heavily increased taxes. The support of the Agrarian party made it possible for the Social Democrats to conduct a long term economic policy without too much compromising in Parliament. A number of social reforms were introduced in the mid-thirties. An important part of the Swedish model, the agreement at Saltsjöbaden, meant that the Confederation of Trade Unions (LO) and the organisations of the employers, solved their differences between themselves. This reduced the risk of conflicts and strikes, which earlier had been common.
World War II
When World War II broke out in 1939, Sweden's defence was in poor condition, mainly because of the reduction in the forces in 1925. This led to a need for immediate rearmament. This rearmament continued right throughout the war. The main question for Sweden was how to stay neutral. When Denmark and Norway were occupied by the Germans, many thought that Sweden had no possibility to stay out of the war. A coalition government with all parties represented in the parliament, except for the Communists, was formed.
Sweden was never attacked by Germany. This was probably due to the fact that Germany did not have to. Germany was dependent upon Swedish metal ore from the mines in northern Sweden. Throughout the entire war, the Germans had no trouble in getting this metal ore. Sweden also exported ball bearings to the Germans, vital for their production of tanks and aeroplanes. German troops were transported to Norway and Finland on the Swedish railroad system during the war. After the German set-back at Stalingrad the Swedish policy towards Germany changed. The troop transports, for instance, were stopped. After the war this compliance to the Germans has been discussed and criticised. At the time, however, it was considered necessary in order to avoid confrontation with Germany.
There were, however, Swedes who took part in the war. When Finland was attacked by Russia in 1939, several thousand Swedes took part in the defence of Finland as volunteers. Sweden also supported the Finns with war material. The most famous Swede who played an active roll during the war was, without question, Raoul Wallenberg, who saved the lives of thousands of Jews in Hungary towards the end of the war.
After World War II
When the war was over Sweden was in a very favourable situation. Industry was intact and ready to start manufacturing products that the devastated Europe desperately needed. This caused an economic boom in Sweden; a boom that made the rapid development of the Swedish welfare-state during the fifties and sixties possible.
The dominating force in Swedish politics during this time was the Social Democratic party. The Social Democrats wanted to increase the size of the public sector. In the fifties, they formed a coalition with the Agrarian party. The social democratic policy towards to a welfare system mainly financed by taxes, led to a steady increase in taxation. This policy was strongly opposed by the Conservatives. The most infected political controversy during the late fifties was the fight over the national supplementary pensions scheme. This fight was won by the Social Democrats and the Confederation of Trade Unions who were in favour of the new pension system. The victory in the pension fight enabled the Social Democrats to continue their expansionist politics regarding the public sector. The social reform policy continued.
In the beginning of the 70s the growth in the Swedish economy was gradually reduced. The situation worsened because of the worsening economic situation in Europe and the United States. The demand for Swedish products on the international market diminished. The steel and shipping industries are examples of branches that received massive economic help from the Swedish State. In 1974 the Social Democratic Government began to borrow money to sustain private and public consumption. This policy was continued by the Conservative/Liberal Government that came to power in 1976. In the beginning of the 80s, Sweden borrowed more money and imported more than the country earned and exported. This was the beginning of the financial problems that Sweden suffers from even today.
The neutrality policy
During World War I and II, Sweden managed to keep its neutrality. This was a combination of political will and pure luck. After World War II, in light of the Cold War, the question whether Sweden should remain neutral or join NATO was raised. Before that, in 1948-1949, there had been some discussions about creating a Nordic defence alliance. This failed when Norway and Denmark joined NATO. A Swedish membership in NATO was particularly advocated by some liberals.
Among the political parties in Sweden a consensus regarding whether the country should remain neutral if war broke out, soon developed. The doctrine was a de facto doctrine, not a de jure. This meant that Sweden was free to form its neutrality policy after its own choice. This in comparison with, for example, Austria which has neutrality written into its constitution. The purpose of the doctrine was to keep Sweden out of any alliance in peacetime, thus enabling neutrality in a war situation.
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