Sweden has recently become known as one of the members of the Frugal Four group in the negotiations concerning the new European long-term budget. These member states are skeptical towards the idea of corona bonds, and, as net contributors to the EU budget, they are open to paying more to the EU but “there are limits”.
Sweden has recently become known as one of the members of the Frugal Four group in the negotiations concerning the new European long-term budget. The Frugal Four (Sweden, Denmark, The Netherlands and Austria) argue that the long-term budget should remain at around one percent, are skeptical towards the idea of corona bonds, and, as net contributors to the EU budget, they are open to paying more to the EU but “there are limits”. Many pro-Europeans view the Frugal Four as a hindrance to European solidarity; cheapskates who put their own interests before those the EU at a time of crisis. While there may be some truth to that, the situation is more complicated. As a Swedish Green politician, I will try and provide some context that might explain the frugal Nordic position.
Sweden’s skepticism of too much European integration
The Swedish view of the EU has always been positive but cautious. Positive towards cooperation and free trade that might bring mutual economic benefits, and, at the same time, worried that too much power in Brussels might lead to regulations that could undermine Swedish environmental or workers’ rights regulations. The idea of viewing the EU as a single political unit with the federalist goal of a United States of Europe has never gained any traction in the Swedish debate. This includes the Swedish Greens, who, for a long time, argued that Sweden should leave the EU. The EU was considered a neoliberal project whose distance between politicians and citizens risked undermining democracy. This position was abandoned in 2008 and the Greens now conform with the political middle, cautiously positive towards the EU, but as a forum for cooperation rather than as a political project in and of itself. Thus, there is no real support in Sweden for the grand visions for the EU laid out by Macron.
Sweden’s skepticism towards a federalist EU also stems from our decision to remain outside the Eurozone. New calculations from national economists indicate that Sweden’s economic growth would have been only a third as high over the last 17 years, had we switched to the euro rather than keeping the krona. The euro crisis of 2011 demonstrated that having a common currency but differing economic policies do not go hand in hand. For Sweden, however, this implies that the euro was a mistake in the first place rather than that further integration is needed in order to resolve the problems caused by the last round of integration.
Sweden’s skepticism towards an expansionist EU also stems from it being a small member state. There is concern that, when Macron talks about a united Europe, what he means is a Europe united under France. European leaders may talk about EU solidarity, but their actions still favor the national interest. Former Swedish finance minister, Anders Borg, writes in his memoirs about his experiences of the EU negotiations held during the 2008 financial crisis. According to him, countries in southern Europe, particularly where France had financial interests, were offered far more lenient economic bailout packages than countries in Eastern Europe, such as the Baltic states. He writes “Maybe I was naïve when I started as a finance minister, thinking that all countries would be treated equally. That is not the case. (…) Small countries in northern or eastern Europe should have no illusions - the game is rigged.”
The parallels to today’s discussion on corona bonds should be obvious. Pro-Europeans may accuse the Frugal Four of showing a lack of solidarity. But some Nordic politicians suspect that the calls for solidarity would not resound nearly as loudly on the continent if northern or eastern regions were the most affected. Having said that, one can hardly disregard the fact that the Swedish position is in some ways nationalist. This may seem strange from a social democratic and green government, but the explanation is simple. With the far-right Sweden Democrats polling at 20 percent, the Social Democrats will do whatever it takes to avoid further losses to the right.
Economic redistribution comes at a political risk
I believe that the Frugal Four need to be more accommodating towards the needs of southern Europe in this time of crisis. Sweden is a highly export-dependent country; helping others economically is also helping ourselves. But pro-federalists need to understand that economic redistribution comes at a political risk. In countries such as Belgium, Italy and Spain, secessionist movements have arisen as a result of economic resources being transferred from one part of the country to the other for a long time. It is morally sound that stronger EU members help weaker EU members, but we must take economic grievances into account, or else risk a nationalist backlash where more countries may follow Britain out of the Union.
When Germany takes over the EU presidency, managing tensions between the Frugal Four and more expansionist governments will pose a major challenge. Still, regardless of whether we are frugal or federalists, we are bound by the common understanding that the EU is the best tool out there for us to work together, advance our interests, and help each other in times of need. Hopefully, this insight will lead us to a common solution.