Swedish socialists still in the stone age

Since 2006, the Swedish government has been composed of an alliance of centre and conservative parties. These have implemented a variety of tweaks to the tax system. Some of them, such as a cut in the property tax, have been counter-productive, whilst others have been mildly beneficial. These include concessions for self-employed building workers, a cut in value added tax on restaurant meals, and cuts in payroll tax – from 40% of gross pay, payable by the employer, to 31% in 2009, with a further cut to 15% for employees under the age of 25, and 10% for those between the ages of 66 and 75.

This is not a situation we would like to see but unemployment is highest amongst the under-25s and the changes are at least a move in the correct direction. One might have thought that the left-wing opposition parties would have gone along with this, but seemingly not. Last week the Swedish Social Democrats and Left parties, part of the opposition alliance, presented a motion to abolish the concession for young employees. Is it really so difficult to understand that if a tax makes it more expensive to employ people, then fewer people will be employed?