Whiskey on the Rocks - Part I
It was hard to say that neutrality had not worked out extremely well for Sweden. The country's wealth was built, in large part, on having been one of the few countries not to be invaded in either WW1 or WW2
and didn't suffer any kind of revolution or civil war in the interwar period; her exports of raw goods, embarrassingly by the mores of the 1970s primarily to Nazi Germany, had filled the country's coffers and helped her industries burgeon even as Swedish diplomats worked around the clock to provide refuge to Jews, even in the belly of the beast in Budapest, such as the efforts of Raoul Wallenberg. Unlike her culturally similar Nordic cousins of Norway and Denmark, which eagerly placed themselves under the NATO umbrella almost as soon as the idea of a North Atlantic Treaty was offered, Sweden had instead pursued its own middle path, dedicated to its position looking at the Cold War from the outside, its neutral posture allowing men like Dag Hammarskjold to rise to the top of the UN while its growing industries, intact in the postwar era, were able to produce cars, steel, ships, and aircraft
[1] for European and international markets while building a robust welfare state under the continuous rule of the Social Democratic Party, which had come to power in 1936 and would hold power for the next 40 straight years.
Of course, Sweden's persona as a neutral utopia of social democracy, a warm and inviting land of red-painted cottages with white trim dotting the rolling snow-covered hills inhabited by tall and gorgeous blondes covered up a considerably more complicated society than met the eye. The dominance of the Social Democrats was made possible in part by tactical alliances with the Centre Party, a clientelist agrarian outfit of the peculiarly Nordic variety, and enjoying supply and confidence of the Swedish Communists, who were cordoned out of formal government but could be expected to carry the Social Democratic water if push ever came to shove. They were assisted further by a split opposition, with the Liberals and Moderates (the rebranded Conservative Party of old) as frequently at each other's (and, starting in the early 1970s, the Christian Democrats') throats as they were aligned against the incumbent party. This attracted a great many political figures to the governing party, and meant that there was a significant and tangible split between the party's right wing and its left wing that was sorted out at party congresses and in backroom debates rather than in front of the general public.
The central, indeed epochal, figure of postwar Sweden was Tage Erlander, known as "Sweden's longest Prime Minister"
[2] both for his remarkable stature and that he served 23 consecutive years at the head of government, from 1946 to 1969. Erlander built the Swedish welfare state while managing to do it with buy-in from liberal-conservative parties, balancing the creation of robust universal health care, housing and education programs with foregoing any future nationalizations of industry (as in sharp contrast to how Labour, in much more traditionally conservative Britain, went about things), and doing all of it with income tax rates lower than the United States while having the fourth largest military budget on Earth. This was one of the tradeoffs Erlander had made clear was part of the equation - Sweden's neutrality, and indeed its "Strong Society," as he termed it, needed to be underwritten by its ability to unilaterally defend itself. For a time, this included eventually aborted attempts at an independent nuclear deterrent that eventually ran on the rocks of left-faction opposition and, well before that, the refusal of the Eisenhower administration to give Swedish scientists key assistance without the
quid pro quo of signing up for NATO, but Sweden nonetheless had a vast military built on the foundation of mandatory universal conscription
[3] with the third-largest air force in the world by the late 1960s as its crown jewel.
When Erlander resigned in 1969, he had overseen Sweden's rise from a rural resource-based economy on the periphery of Europe to an urbanizing, wealthy and vibrant society that was the envy of even some of the postwar boom's emerging major powers; indeed, it was the 10th largest economy in the world, a fact that would have been unbelievable just two generations earlier.
[4] The Social Democratic Party had just earned an absolute majority in the
Riksdag and would soon rewrite the relationship between monarch and government into an even more minute constitutional figurehead. Only the superpowers and Israel, in its famously unfriendly neighborhood, spent more on their militaries and had higher quality kit. It was hard to see, exactly, how the wheels could come off.
But come off they would. Erlander was a straightforward, no-nonsense, pragmatic man in the modest, small-c conservative Scandinavian tradition. His successor Olof Palme was a quarter-century his junior and of a very different generation politically. That Palme's name would come to be associated with radical left-wing politics both in Sweden and abroad was an accident of his youthful travels in the Americas; he was born to a wealthy, conservative and monarchist Lutheran family with deep, longstanding ties to German nobility (indeed he had direct Baltic German ancestry) and his namesake uncle had died a decade before he was born fighting on behalf of the Whites in the Finnish Civil War at the head of an anti-Communist battalion of Swedish volunteers.
[5] Having gotten his start in politics as the head of the Social Democratic Youth League, Palme was nonetheless much more similar politically to the left-wing students who, in the spirit of the global uprisings of 1968, occupied the main student union at Stockholm University and who rallied against not just the Vietnam War but capitalism in general.
[6] While certainly not entirely anti-capitalist, his chief political theory was that Sweden, having achieved great material wealth through its unique brand of social democracy, had a moral duty to export those duties abroad by leveraging her status as a rising power that punched above its weight economically, militarily and culturally, and one way for Sweden to do so was to emerge as the most prolific proponent abroad of selling a new program of progressive democracy that centered first and foremost on human rights.
This was not to say that Palme was uncontroversial at home - he greatly expanded Sweden's welfare state in the first half of the 70s and his efforts to improve the position of organized labor and job security drew the ire of a business community that had gotten along well with Erlander's more conciliatory rhetorical approach. But he was particularly a figure of scorn in the United States due to his unwavering belief that the superpowers were equally morally culpable for the atrocities of their client regimes in the Cold War; his arrival in office nearly exactly coincided with the Nixon administration, and in Richard Nixon, Olof Palme had found his perfect foil. The enmity was mutual; Palme's comparison of the Hanoi bombings in 1972 to the aerial destruction of Guernica and the horrors of the Treblinka death camp resulted in a formal break of Swedish-American relations, and he likely avoided an election defeat in 1973 thanks to the unfortunate timing of the Chilean coup, which Palme had zero doubts had been directly sponsored by Nixon, occurring mere days before appalled Swedes headed to the polls.
[7]
The timing of the 1973 election was fortunate in other ways, as it occurred a month before the 1973 Arab oil embargo, which struck Sweden hard. Palme now had to govern as Prime Minister in the midst of the first genuine economic crisis Sweden had been subjected to since the Great Depression; the "record years" of 1946-73 being definitively over, Palme was now forced to navigate his way through his most difficult period yet, and in 1976 the Social Democrats lost an election for the first time in forty years.
[8]
If Palme had worn out his welcome with the Swedish electorate (in no small part from defections of more old-school voters put off by his more socially progressive stances rather than old-fashioned social democratic laborism), Swedes would be treated to a debacle of remarkable proportions with what came next. The three-party coalition of the Centre, the Moderates and the Liberals agreed on little other than their mutual opposition to the tired and long-in-the-tooth incumbents, and Centre - as the largest rightist party - was able to propel its leader, Thorbjorn Falldin, into the Premiership. Falldin was a very different man from Palme; he was quiet and modest, renting out an apartment in Stockholm where he did his own cooking and took his own garbage out while his family tended his farm further north. He was also not the most talented politician, often struggling to manage the divergent personalities and ideologies of his coalition, and he was forced to resign as Prime Minister in 1978 due to the price shock but, probably just as likely, his opposition to nuclear energy (a rare area where the Swedish right and Palme were in strong agreement was on the development of a large and robust nuclear power base for Sweden as a transition from oil, especially post-1973). Ola Ullsten of the Liberals would replace him but after the indecisive general election of 1979, Falldin returned as PM and managed to stay on even after the referendum against nuclear power was defeated, in part thanks to Palme's intervention.
The coalition under Falldin similarly struggled in the face of an acute economic crisis, in which the Moderates argued for sharp tax and welfare cuts with the statement that it was now unaffordable for Sweden to maintain them and several core Swedish industries such as shipbuilding, steelmaking and forestry entering sharp declines. The unemployment rate in Sweden in the early 1980s was close to the European average despite jobs guarantees and its inflation ticked somewhat higher, and for longer, all while the government fought amongst itself, with the Moderates abandoning the coalition seeming imminent with Falldin's refusal to cave to their austerity demands in budget negotiations. Sweden, once a global darling, was flailing politically as its struggled to pull its way out of the economic malaise the whole of the Western world was still feeling in October of 1981.
And then, on the 27th of October, a Soviet submarine ran aground less than ten kilometers from the primary Swedish naval base at Karlskrona.
[9]
[1] And missiles, rifles, etc, as Sweden has a robust arms industry going back to the Nobels
[2] This colloquialism doesn't translate perfectly to English, but that's what it is
[3]
Lumpen, as its called in Sweden. It is also these days extremely easy to get out of (though post February 2022 may not be anymore) - my dad's allergies got him guarding some supply depot three nights a week, and that was back in the 80s. A lot of people do find their way into careers through it, though, or at least get assignments that interest them. My uncle got into practicing medicine from his time
i Lumpen and my mom's cousin discovered his love of cooking working in the canteen on a naval vessel, and he's now a chef in Stockholm.
[4] Such as for those like my grandfather, born in crippling poverty as one of ten kids in remote rural Lapland in 1907
[5] Hat tip to
@Zulfurium and his incomparable "A Day in July" (by far my favorite TL on this site) for tipping me off that this guy existed and had the same name as his
very different nephew.
[6] Though ironically, Palme was in 1968 not very well-liked by student protestors, indeed he was a target of their ire
[7] I should note here that despite sharing a certain naiveté with other contemporary New Left types about what the North Vietnamese regime and Castro's Cuba were actually like, Palme was a vociferous opponent of Eastern European Communist regimes and was militantly outspoken against the Soviet invasion of Czechoslovakia in 1968; he particularly hated the Husak regime.
[8] Remarkable the staying power "natural parties of government" of all ideological stripes had post-WW2 from DC in Italy to Canada's Liberals to Japan's LDP
[9] So pretty much everything up to the Falldin government and even most of that material is all OTL Swedish history. This is me in part showing off a bit, as I wrote my senior thesis in college on Swedish neutrality in the Cold War so I'm quite familiar with this subject, and part of it is just giving context to this small part of the world that means a great deal to me and which, for whatever reason, I get a kick out of mildly screwing with in my TLs since OTL is about as much of an absurd Sweden-wank as you can get with a POD after Poltava.
(Also, cats out of the bag - the October Crisis is based on the
Whiskey on the Rocks incident that IOTL saw cooler heads prevail but here, well...) special thanks to
@Nazi Space Spy for bouncing this idea around a bit with me a few months ago!
