The government of the leghold trap – Vestmanlands County Newspaper

It looks a little better than before. It emerged when the finance minister Magdalena Andersson (S) yesterday presented the economic situation facing the government’s budget negotiations.

The growth chugging along at 2-3 percent. We trade, private consumption is increasing.

Unemployment is falling and the employment rate, ie the proportion who work, are rising. But only fairly moderate. The government has a long way to go before the goal of the EU’s lowest unemployment rate.

The budget deficit is also reduced. The Treasury will end up at a slight plus 2019th

In contrast, estimated prices rise. It tends to be bad, but is now considered good.

Today’s very low or even negative inflation have led the Riksbank to introduce negative interest rates. So when the government believes that price increases next year will be 1.0 percent in 2018 and 2.5 per cent, it is good news!

The Riksbank would then be able to return to what it usually does, ie raise rates to keep inflation low. End of the inverted world.

The government really has a problem with that times will get better. Then it should gather in the barns to invest when times be getting worse.

2019 will be as forecast a small surplus after years of deficits in public finances. It should then be protected, for deficits in bad times require, even if the government goes into a so-called balansmål, matched by surpluses in better times. But 2018 is an election year, then it is usually difficult to hold back.

The government has said that new initiatives must be paid ‘crown for the crown. ” But it can cause political problems.

There are demands from the Left, not least from the LO, that “austerity policies” must be over and that the state should invest significantly. There are plenty of new spending demands from various quarters. Not least from the Left, who expects to be able to influence the budget.

But the government will stick to the “crown crown” need new expenses paid with higher taxes.

Recent increases thus beyond the tax increases the government has already been through. It teaches meet resistance from business owners and from the bourgeois opposition.

In theory, it should not matter what the bourgeois parties do. They have the DIE promised to let through the red-green budget, regardless of content.

But in practice, DIE threatened if the government comes with challenging tax increases firmly angering companies and bourgeois voters. So it becomes tangled.