Naomi Klein has in her book "The shock doctrine” showed how right-wing forces around the world use natural or accidental disasters to get people to accept a right-wing and economic and social austerity policy that they would never have otherwise accepted.
I mean that our housing and banking policy risks leading us to such a disaster scenario that right-wing forces can exploit.
It is certainly not a deliberately created scenario, but it is a clear consequence of our neoliberal low tax policy and the consequence may well be a disaster that can be exploited by the right even if it may not have deliberately created the disaster.
The villas in Gothenburg are now at an average price of 3,5-4 million. In Stockholm they are considerably more expensive. These prices are unreasonable. These prices have been driven up by two factors:
- the deregulation of how banks are allowed to lend that took place in November 1985 by the Chancellery
- the largely total removal of public subsidies under the bourgeois government of the 90s for the construction of tenements that people can afford to live in. This has led to a huge shortage of cheap tenements which has created a screaming demand for private condominiums and villas
This demand for private housing coupled with banks' willingness to issue unsecured loans has brought us to the brink of a housing bubble similar to the US housing bubble of 2008. The US housing bubble, when it burst, led to the deepest global recession in living memory.
The Borgarna government in the 90s put Sweden in such public debt that S was forced to pursue a long-term austerity policy, i.e. a right-wing policy. The bourgeois Alliance has continued this policy of austerity during the boom, which means that we only have a national debt of 40% of GDP or less. So far everything seems fine.
But together with households' private borrowing, Sweden has a total debt of 306% of GDP. This is bigger than Greece's.
When the bubble bursts, the state will have to save the banks so that people do not lose their deposited money. This leads, if I am right in my fears, to an economic collapse for Sweden which may force us to pursue a Greek austerity policy to pay our debts.
So what can we do? This is a complex issue. But start by regulating the lending activities of the banks very strictly and start building state-subsidized rental properties on a large scale that people can afford to live in. Then the state must do this in an appropriate way so that the price of private housing does not suddenly crash and lead to an economic disaster .
An interesting perspective that this problem leads to is that if banks themselves, due to their importance for social stability, cannot bear the cost of a loss like all other companies, why then should their owners be allowed to bring home huge profits in boom times. State-owned banks!