Our national board of housing, building and planning warned earlier this year that we must build 400.000+ apartments by 2020. Now they’re saying that up to 900.000 households may not be able to benefit from these new apartments. Reason is, they just don’t have the incomes. Of course immigrants will suffer, but no only.
The board suggests that the government will initiate processes so that houses will be built for the low-income households specifically – what is usually called social housing. Something that doesn’t exist in Sweden and something we don’t want to exist. Is it possible that one of our holy cows must be slaughtered? There aren’t really that many alternatives.
One alternative, of course, is that those with the lowest salaries must get raises so that they can afford the rent. And forget owning your apartment. It’s not likely that banks will lend money to this category of customers. Not considering the prices of today. But that would also mean that lots of the few simple jobs we have left will vanish with, literally, the speed of a check on pay day.
Another option is to make more people eligible for the subsidies you can get from the state. Now, this is perhaps not such a good idea since this means that these subsidies will just explode. There is no incentive for any landlord to do anything about rents if they’re more or less guaranteed by the state and how much state budget can be devoted to housing subsidies?
A third option is to pick up the tab via the social welfare system, but that’s a municipal responsibility and that would mean that many municipal budgets will bust as they already do – and for the exact same reasons. And there is no reimbursement from the state. Guess the taxpayer will have to pick up that tab but then people who pay lots in taxes will want to move to municipalities with lower taxes. As they already do today.
Also, getting more people working is another contribution to solving this problem. But that will be difficult when it comes to immigrants. It takes eight years until 50 percent are working with or without subsidies. It takes 12 years before 65 percent are working and it never gets higher than that no matter how long time you spend in Sweden.
The definition or working isn’t quite correct, actually. It’s our census bureau that “owns” the definition and it stretches from working full time to being, really, just busy, paid or not, for a few hours per day. And that includes participating in programs provided by the employment services and subsidized – up to 80 percent of salary paid – jobs.
Immigrant women usually don’t work! It’s much more likely that the men work. But since about 85 percent Swedes work, immigrants are about 20 percent behind. What must also be taken into account is that immigrants also tend to earn less than Swedes. About 20 percent less. This means immigrants are about, thusly, 40-45 percent “behind” when it comes to incomes and that’s important! You do pay taxes on incomes!
Since we don’t have those really simple, low-income jobs in Sweden, especially immigrants have a hard time getting a job. So many of them, usually the man, may have everything from no school at all up to, perhaps, six years or so. Women usually have fewer years than that. As per usual for, always, the same two reasons; women shouldn’t study and there wasn’t money enough to send also the girls to school.
But even if we had those really simple jobs, they wouldn’t pay enough. The ordinary simple jobs that we do have don’t pay enough money. Such households are part of those 900.000! Even simpler jobs with even less pay and you won’t even be able to rent that proverbial show box in the middle of the road (reference to Monty Python)!
Some countries with more of these really simple jobs compensate in other ways. Usually by lower or no tax at all. It doesn’t work that way here since the ever constant taxes that you can really never escape are the municipal and county taxes. Oh! I forgot! There are some “fees” that the employer has to pay that are, in effect, hidden taxes – state taxes.
So… I guess we could do the same here, drop all taxes for those with the lowest incomes and thereby partially open up for the really low-wage jobs. But that would also mean that the government would have to more or less legislate about a minimum wage. We don’t have that here given that unions and employers negotiate those central deals all the time. Those deals also regulate entry level wages. Could unions accept a legislated minimum wage? Hardly and certainly not without putting up one hell of a fight first.
A note about wages. The minimum wage gap as measured as entry level pay vs. median pay is about 70 percent in the US. That means from entry level pay you can see ahead of you, perhaps, a total of 70 percent worth of raises. In Sweden the same gap is 30-40 percent which means that, oops, the wage gap is minimal and entry pay is not far from the median. It’s even more worrisome that the blue collar worker’s collective announced, in early 2015, that they would work for closing that gap even further be ensuring that it would never be more than 30 percent.
Göran Persson, former prime minister and party leader for the Social democrats, declared in the early 1990ies that Sweden’s only chance to continue to develop as a welfare state was for it to become a nation of knowledge and not industrial work. Since then, the requirements to have at least a high-school diploma has increased, right or wrong, to, sometimes, absurd levels. But then once the genie was out…
There are, or rather were before this summer, autumn and winter, about 140.000 adult immigrants with a less than desirable level of education. What that number is now no one really knows. Takes time to do the inventory! Oh, and there are Swedes with no high-school diplomas, either. They’re not that many of those left. There are some who managed to totally flunk nine years of compulsory school, too! And then there are those with various forms of disabilities who need extra help.
By the way, next year will probably see up to 75 percent of those registered with the employment services being far or very far from getting a job and most of those will be immigrants. And, to a high degree, also their children and spouses. Not that the many in the latter group is particularly eager to get a job as long as society provides for them.
What the number will be as a result after 2015 massive immigration no one really likes to think about. It will take immigration services some two years(!) to process all the asylum applications and then another two to three years in the establishment program before we know the exact, as far as we can get an exact number, from employment services. And that means the shit will really hit the fan some time in 2018 at the earliest to about 2020. By then we’ll also know the impact on the municipal social welfare budgets.
So, back to the housing issue. That one will be one tough nut to crack. There are two major reasons to why.
Number one is, there shouldn’t be any substandard anything in this country. That’s why all rights are for all and really with no exceptions. Take the child benefit. Every child, actually, gets it. Not really the parents. And the parents don’t have to apply to get it and there is no look into the families finances. So, why can’t rich people pay for their own kids? Because that means that the poorer people will have to send in application together with bank statements and tax return forms and whatnot. And that’s something we don’t want. Then it becomes too close to charity and that’s another thing we don’t really have or like in this country. Everybody has a right (well…) to somewhere to live and your income shouldn’t really (well…) matter (that much). At least you shouldn’t have to live in a hovel!
Second reason, these days, is that by creating social housing we would point fingers at a group of people. Those who aren’t affluent enough and have to live in subsidized hovels! They will have to be hovels, by our definition, because municipal budgets wouldn’t survive if they had to pay in full or subsidize ordinary rents.
So… We’re perhaps looking forward (shudder) to the social housing/estates of the UK. Know you have something similar in the US. And we all know the stigma that comes with zip codes and neighbourhood names no matter how fantastic they may sound to hide the gray, bare concrete of high-rises full of too small apartments with too small windows and where elevators usually don’t work and the cars smell of urine and are full of gangbanger’s tags.