Domestic demand has become so low i.a. because we sell for more 6% more than we consume per year in Sweden according to Ulf Jakobsson at The business world. Another reason is the surplus target, which means that even though Sweden's public financial surplus increases year by year, according to the rules of the Riksdag, it cannot be used to invest in stronger, long-term, domestic economic development. He is right about this. When any group in society, be it a country or a clique of private individuals, gets too much benefit from the economic cycle, they get more than they can consume and the economic cycle begins to wear out. Ulf Jakobsson believes that our economy could be 234 billion bigger per year if we corrected the current account. However, he seems to find it uncomfortable to follow the logical chain to its end and realize that we need more international solidarity, increased distribution policies in favor of low and middle income earners and an expanded public sector to bring about this positive development.
Left blog
