chapter  6
Establishing a New Social Order based on ‘Workfare’
Pages 62

After the turmoil of the 1970s involving a loss of the ‘spirit of Saltsjöbaden’ through hostile industrial action and the economic worries associated with the oil crises, the re-elected Social Democrats attempted to find a new path for Swedish economic policy in the early 1980s. This new path was formulated as a Third Road, a compromise between Keynesian stimulus by deficit and Thatcherite monetarism, and it included a significant currency devaluation, attempts at wage restraint and control of public spending (Benner and Vad, 2000, p. 422). Although wage restraint turned out to be a more difficult goal than anticipated – centralised wage setting came to an end in 1983 – this economic policy strategy of the Social Democrats seemed successful at least in the early years of the 1980s.