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In Sweden, Nobody Sleeps in Dumpsters

by John Brian Shannon | June 24, 2015

In Sweden, nobody sleeps in dumpsters. Not one.

And everyone who visits Sweden wonders why.

The simple answer is that human beings in Sweden are treated as the country’s number one resource. In Sweden, people are ranked #1 while everything else in the economy is considered less important

Strange system, isn’t it?

Holger.Ellgaard - Own work CC BY-SA 3.0

Stockholm, Sweden financial district. Holger.Ellgaard – Own work by CC BY-SA 3.0

That’s not to say that Sweden’s various economic sectors and segments aren’t important, it’s just that ‘people come first’ with the Nordic Model — while companies and government come second and third, respectively.

“Are there any jobs?”

Well yes, there are! In fact, if you want to work, you work! However, some job-sharing may be involved, depending on your industry.

“Are you saying the unemployment rate in Sweden is 0 percent?”

Almost. Historically the unemployment rate hovers around 2 to 3 percent. But since the global financial crisis hit, Sweden’s unemployment rate shot up to a record-high to 8 percent in August, 2013.

But things are not always what they seem. And this is one of those times.

In Sweden, there are employed and unemployed people just like anywhere else — but the difference is every worker is employed for at least 6 months of the year, as the country has mandatory job-sharing for those industries that can’t fully employ their workers.

“So nobody is unemployed for longer than 6 months per year?”

Yes, that’s true. There is unemployment, but each worker knows that they will get re-hired and they know the exact day when they will be re-hired — usually at the same company that they have worked for the past number of years.

It’s a very temporary unemployment rate in Sweden, and there are zero ‘discouraged workers’ — those who’ve given up looking for work. (Unlike the situation in North America!)

The bottom line? It’s a simple case of making certain everyone gets to contribute to the Swedish economy over the course of the year — which has many benefits for workers, their families, corporations and for Swedish GDP.


“Why do Swedish workers, corporations, and the government like this arrangement?”

The benefits are many.

First, corporations love this setup as some industries cannot employ all of their workers year-round, or in industries where the work is seasonal, corporations can easily lay-off their workers and know that their fully-trained workers are guaranteed to return to work on the very day the corporation requests them to return.

Swedish companies always have a waiting list of employees who want to return to work. These workers are temporarily receiving unemployment insurance, but have worked for the company within the previous six-month period.

It’s a simple case for companies of figuring out how many people they need for the coming weeks or months, and sending out the appropriate number of emails to ‘their’ (temporarily unemployed) workers.

Without any further ado, those people show up on the dates requested and they quite willingly return to their ‘old job’ — the job they had before they were laid-off.

Whether their job was canning herring, cutting down trees, teaching science class at High School or working at IKEA, they simply show up and resume their previous duties.

Sometimes, this means that other workers are temporarily laid-off to make room for the returnees, but in the case of seasonal workers or during busy times such as the Christmas shopping season, nobody gets a layoff notice AND the many returnees are simply added to the weekly work schedule.

Sometimes it happens that two people will share a certain position for decades, trading it back and forth every six months.

Remember, the unemployment rate historically sits at 2-3 percent. So, people are mostly employed anyhow.

Second, corporations like having a large pool of already trained workers that are easily available to them.

Because these workers are never away from ‘their’ company for longer than six months (usually fewer months than that) they can return to their company with their skills intact and their familiarity with the policies and procedures of that company allow them to ease back into their ‘old job’ with only a half-day refresher course.

A large pool of fully trained workers with sharp skills, returning to their old jobs, exactly when and where requested, at any time the company wants. That’s a bonus for companies.

Third, not one person in the entire country who is capable of working is on ‘welfare’.

‘That’s funny,” you say, “because I learned that Sweden was a ‘welfare state’ when I was in school.”

Maybe they should have spelled it; ‘Well-fare state’ or said it even more correctly; Sweden is the ‘fare-well nation’ — because they want ‘you the worker’ the number one resource in the country, to ‘fare-well’.

Very well, in fact.

Workers in Sweden are either; a) working, or b) on very temporary unemployment insurance. Say it slowly to let it sink in; In Sweden, there is no ‘other category’.

Disclaimer: People who are retired, or who are home-makers, or are on maternity/paternity leave, or those who have illness or permanent disability, aren’t classed as ‘workers’.

There is no such thing as people who’ve ‘given up’ looking for work and who have turned to other lifestyles, such as living in dumpsters.

In Sweden, if you want to work — you work!

Four, workers like it that they can choose to overpay their unemployment insurance contributions (via a special public/private company set up for that purpose) so that workers can top-up their government unemployment insurance benefits up to 99% of the full pay they received when they were employed.

For the equivalent of two cents per dollar, Swedish workers can voluntarily top-up their unemployment insurance account, to allow up to 99% of their normal salary to be paid to them as unemployment benefit payments while they’re temporarily unemployed.

It’s up to each worker how much they authourize to be automatically deducted from their paycheques. (Each equivalent of 1.6 or 1.7 cents per salary dollar earned, gets you another 10% top-up on your unemployment insurance payments)

Most people voluntarily choose to top-up their unemployment benefits to only 90 percent of their normal salary as they are no longer commuting to work, they don’t need the extra 10 percent to pay for gas or subway fare.

And unemployment insurance benefit payments automatically begin the day you are laid off. Hey, it’s your unemployment insurance — you paid into it. It’s not your fault your industry can’t keep you fully employed!

Just for the record, both the government UI system and the private UI system earn more revenue than they pay out to recipients. Both are profitable enterprises.

Five, unemployed workers can earn extra money ‘covering’ for employed people who call in sick.

I hope I’ve described things well enough that you’ve understood all of the above. Because I’m about to drop a bomb on you.

i) Let’s say you work for IKEA and you’re enjoying your layoff period with your (typical) 90-percent-of-regular-salary unemployment benefits.

ii) So, ‘Sven’ from IKEA calls in sick (skiing accident) and he will miss work for one week on Doctor’s orders.

iii) Your name is at the top of the ‘Do Call’ list because you have seniority at that IKEA location and let’s say that they call you to ‘cover’ Sven’s shifts.

iv) Not only do you continue to receive your full unemployment insurance payments while you ‘cover’ for Sven (typically equal to 90% of your full salary) you also get paid the normal hourly rate for Sven’s job description, which may be slightly more or less than your normal salary.

v) Thank you, Sven!

Many people are eager to get onto the voluntary ‘Do Call’ list for that reason. I wonder why.

(Yes, the private company that offers the top-up insurance investigates these occurrences, but fraud is rarely a problem with such a generous system. The top-up insurance company can cut you off from the top-up system for life. Which means that during your layoffs for the rest of your life, you will be forced to survive on only 66 percent of your regular salary which is what the government unemployment insurance benefit pays)

Six, workers like that while on layoff (at up to 99 percent of normal pay) you can apply to work for a non-competing industry, or take some university classes, or you can volunteer at a charitable organization.

Some people may want to broaden their horizons or they may need to amp up their résumé. Maybe they want a new job that is closer to home, or maybe they want to get into teaching.

If ‘your’ company (the one you normally work for) calls you back to work, you must return to work for ‘your’ company. But employers in Sweden are very good about simply calling the next name on the list if you’re actively enrolled in college, for example.

Seven, while you’re laid-off and receiving up to 99 percent of your normal salary, you may wish to go on a cruise to the Mediterranean for example. That’s expected.

But workers must notify their company ahead of time so that the company you normally work for doesn’t call you to ‘cover’ for Sven who has broken his ankle skiing. Again.

And look at you, suntanning in the Med, missing out on collecting ‘double pay’ just when you thought Sven had mastered the art of skiing. ‘Förbannat du, Sven!’ (Damn you, Sven!)

Life is tough when you’re a Swede.

Read about the healthy Swedish economy here

The Psychology of Climate Change Action vs. Inaction

by John Brian Shannon | June 18, 2015

The incompetence thus far displayed by politicians and corporate leaders is directly proportional to the size of the Tragedy of the Commons problem.

History has shown that the bigger the civilizational problem, the less likely it is to be dealt with by human beings.

And the inexorable destruction of our biosphere, (the only part of the planet in which we live) is the biggest problem we’ve yet faced as a species.

But, big as that challenge is, we will likely continue to fail in preventing catastrophic damage to our biosphere due to the built-in mediocrity factor present in human beings.

“It has become appallingly obvious that our technology has exceeded our humanity.” — Albert Einstein

If the status quo continues, there will be no major adjustment to the ongoing destruction of the planet.

Yes, there will continue to be major talk, talk, and more talk. But little action. We will ride the bus right over the edge of the cliff, talking all the way to crunch time. And if there are any survivors, they’ll still be talking.

Because that’s who we are as a species. We solve small and medium-sized problems, and we talk, talk, talk, about solving large problems — but never succeed.

And it may well end in the demise of our civilization. If not from the climate, then from something else.

The Cost of Climate Action vs. Climate Inaction

The Cost of Climate Action vs. Climate Inaction

Meanwhile, some very dedicated people (Hi! Christiana Figueres, et al) are working on it and have proposed very workable solutions (which for the most part are being ignored) none of it requires any technology or economic models that we don’t already have.

We have it all, except the will to act!

From: ‘On Care for Our Common Home’ — the encyclical written by Pope Francis.

“Humanity has entered a new era in which our technical prowess has brought us to a crossroads.

“We are the beneficiaries of two centuries of enormous waves of change: steam engines, railways, the telegraph, electricity, automobiles, aeroplanes, chemical industries, modern medicine, information technology and, more recently, the digital revolution, robotics, biotechnologies and nanotechnologies.

“It is right to rejoice in these advances and to be excited by the immense possibilities which they continue to open up before us, for “science and technology are wonderful products of God-given human creativity.”

“Our freedom fades when it is handed over to the blind forces of the unconscious, of immediate needs, of self-interest, and of violence. In this sense, we stand naked and exposed in the face of our ever-increasing power, lacking the wherewithal to control it.

“We have certain superficial mechanisms, but we cannot claim to have a sound ethics, a culture and spirituality genuinely capable of setting limits and teaching clear-minded self-restraint.” — Encyclical by Pope Francis 2015

Read: The Pope’s Memo on Climate Change Is a Mind-Blower (Wired)

Taking all of the above into account, we have the wherewithal to solve the problem, just not the will to act. Therefore, we will fail. It is inevitable. Unless we change the nature of the problem

“You never change things by fighting the existing reality. To change something, build a new model that makes the existing model obsolete.” — Buckminster Fuller

One way to do that, is to get rid of all fossil fuel subisidies, which hit $583 billion dollars last year. (That’s over $1 trillion dollars of subsidy every 2 years)

That’s the direct subsidy… the externality subsidy might be as high as $2 trillion dollars per year globally for fossil fuels.

On the externality subsidy… according to a highly-regarded Harvard study the burning of coal in the United States causes $500 billion of health, crop, and infrastructure damage annually, within the U.S.A. alone. That’s just coal.

Read: Full cost accounting for the life cycle of coal (Harvard)

A better way, is by matching fossil fuel subsidies to renewable energy subsidies based on energy output — for example, by Barrel of Oil Equivalent (BOE)

In that way, a level playing field will allow renewable energy to flourish in regions where it is viable and it would receive the same level of subsidies that fossil fuels are already receiving — and have received every year since the 1930’s.

A third way, although likely to be unpopular would be the most effective; Using the ‘command and control’ model — where each nation legislates that coal burning is thenceforth illegal (that would solve the largest part of the atmospheric pollution problem right there) and that half of all new cars sold in each country must be electric (EV) or hydrogen fueled vehicles

We all ‘get’ that manufacturing electric vehicles causes some amount of pollution at the time of manufacture (just like any car manufacturing process) but it is the daily exhaust fumes from millions of cars that pollute the air, which is orders of magnitude greater than the amount of pollution generated by the initial manufacture of any car, whether electric or gasoline powered.

My entire case rests on this; If we continue bumbling along the status quo path, we won’t ever properly address the problem.

We need to; ‘build a new model that makes the old model obsolete.’ Just like Buckminster Fuller said.

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International Trade Agreements: Win-Win or Lose-Lose?

by John Brian Shannon | June 11, 2015

The secrecy surrounding these agreements is a complete non-starter for me.

The obsessive secrecy is enough to tell me everything about this being a corporatist agenda on the one hand — and a latter-day containment policy concerning China (or any country that crosses the U.S.A.) on the other.

It really muddles the difference between trade and governance as many commentators have said.

Elizabeth Warren, as usual, has it right; “If transparency would make it harder to sell the final product to the public, it raises serious questions about the desirability of what is being negotiated.” — Elizabeth Warren (paraphrased by Professor Dani Rodrik)


Yet, having said all of that, I’m strongly in favour of international trade agreements!

TTIP protest in London, UK

TTIP protesters in London, UK (Aug 2014)

What NAFTA could’ve been, vs. what it became

To this day I’m a strong proponent of NAFTA — but NAFTA had the potential to be so much more.

Instead, some of the more mediocre minds took over what was a grand overriding vision of peace, order, and good governance for all of North America — and one of the vehicles to help make that happen was the original NAFTA agreement, which was to be followed up by additional agreements, e.g. NAFTA II and NAFTA III.

But because it was handled so badly, the public mood turned against NAFTA and all talk of later NAFTA agreements were dropped like a stone

To state it a different way; The corporatist agenda greedily precluded the long term interests of North America.

And what did we get in exchange from corporations for opening up the North American market thereby allowing corporations to make additional billions per year?

They took their NAFTA windfall profits they had earned in North America to Asia, and 2/3rds of North American manufacturing jobs went to Asia, as well.

Thanks for that.

But it’s not the fault of corporations. They’re in business to make money for their shareholders — which increasingly, means the 1 percent.

To one person, the actions of these corporations might seem profoundly ungrateful to North America — while to another person, these corporations acted in their best interests.

It depends who you work for, I guess…

If you’re a person who works for 1 percent of the population, then this result is acceptable to you. If you’re a person who works for the 99 percent, then this is a wicked bit of business indeed.

Occupy Wall Street protests and other anti-corporate sentiments didn’t materialize out of thin air.

The Occupy movement happened because 99 percent of the population suddenly realized that both the corporations and government were ‘against’ the little guy — you know, the people who actually pay the bills and fight in wars — not the cabal of the 1 percent and their government acolytes

If we pass TTIP and TPP in a shroud of secrecy to further satisfy the corporatist agenda the #OWS protests will seem a minor historical disruption by comparison. (Just a friendly warning from someone who believes in trade agreements)

Some look for advantages between signatories of trade agreements

Which completely misses the point.

In the NAFTA example, many people were spending endless hours trying to decide if the NAFTA agreement benefited Canada? Did it benefit the U.S. more? Or perhaps Mexico was the main beneficiary?

NAFTA was about lowering barriers to improve the free flow of trade between the North American partners with the goal of making North American products and services more competitive in all respects — against other trading blocs or nations. Not against each other.

THAT is what NAFTA was about. Which many people missed originally, or have since forgotten.

It’s too bad that the subsequent windfall profits ended up strengthening the Asian economy instead of the North American economy where all of those profits had been earned

So; Are those corporations ‘traitors’ to North Americans — or are those corporations ‘heroes’ to their shareholders?

The answer is glaringly obvious.

If you’re a one percenter (or a government acolyte of the 1%) then these corporations were ‘doing their duty to shareholders’ under legal boundaries set by government policymakers and financial regulators, even though the optics look incredibly bad for both corporations and government policymakers.

If you’re a ninety-nine percenter you probably view these corporations as ‘traitors’ to North America — even though these corporations followed the letter of the law. Everything else is just spin for you.

A summary of NAFTA?

1. It could’ve been so much more.

2. The corporations made additional billions (maybe even trillions) due to NAFTA, and in that respect it scores a clear win for corporations — but they have lost much of the support and good will of ‘We the People’ in the process.

3. The additional revenue made by corporations due to the NAFTA agreement are now in China not doing a damn thing for the North American economy where those windfall NAFTA profits were earned, making NAFTA the third-largest transfer of wealth in modern history.

(a: The largest wealth transfer in modern history was from the Old world to the New world, b: the second-largest wealth transfer in modern history was from the West to the oil rich Kingdoms, since 1932)

4. NAFTA was a major instrument in the creation of the 1 percent and the societal problems that have since flowed from rising inequality.

Unprecedented in modern history, the 1 percent own more wealth than 1/2 of the world’s population and by 2030 the 1 percent will own 3/4 of the world’s total wealth.

Leaving only 1/4 of the world’s wealth for the 99 percent to exist on, going forward…

Can you say… inequality? Or how about… protest marches? This time with billions of protesters.

As productivity has only little room for improvement in the developed world, the only other factor to allow the present economic paradigm to continue is falling incomes for the 99 percent

If you don’t recognize that as a looming societal apocalypse, you’re not an economist.

If you are an economist, I apologize in advance for your nightmares.

It looks like it’s up to citizens to stop policies that are clearly skewed to benefit the 1 percent and are increasingly detrimental to the 99 percent.

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