Image copyright Getty Images Image caption Something to smile about: the Swedish economy is currently growing at six times the rate of the UK's

The cash-strapped coalition government is questioning what kind of welfare state it can afford and has been taking notes on Sweden - a country which manages an extensive welfare state while balancing its books. But how does the Swedish model work, and can we copy it?

Not so long ago, the Tories liked to go policy shopping in the United States. These days, they look to Sweden for ideas.

Yes, that Sweden. The pin-up of the British Left. Land of progressive values and free love; big government and high taxes.

But David Cameron's Conservatives are attracted by a different set of vital statistics.

David Cameron can only look on in envy, Sweden - which is regarded by many as the most socialistic country in Europe - has managed to do things that right-wingers in Britain think would be impossible in their own country Fraser Nelson, The Spectator

Sweden is number one in Europe for competitiveness. Its economy last year grew six times faster than the UK's - and the deficit is at zero.

Yet in the 1990s, Sweden was even worse off than we are now. The economy came crashing down when a housing bubble burst. Interest rates hit 500%; debt and unemployment reached crisis levels.

No wonder the British government is eyeing up the Swedish model.

Or should that be the 'new' Swedish model? After the meltdown of the '90s, competition was brought into the welfare sector.

The free school system was born, with private companies given taxpayers' money to set up schools. The idea was copied in England 20 years later but with one significant difference: Swedish free schools are allowed to make a profit.

Imagine that over here - plus, there have been similar reforms in the health sector and care for elderly people.

Too radical for Cameron?

David Cameron can only look on in envy, says Fraser Nelson, editor of the right-leaning Spectator magazine:

Image copyright PA Image caption A fan of the 'Swedish model', David Cameron has met Swedish Prime Minister Fredrik Reinfeldt

"Oddly, Sweden - which is regarded by many as the most socialistic country in Europe - has managed to do things that right-wingers in Britain think would be impossible in their own country: too pro-market, too right-wing for even British consumption," he says.

Any move towards privatisation of public services in the UK is met with stiff resistance from the unions.

Yet the unions in Sweden are much more powerful, with seven in 10 workers signed up. So how come they didn't stop the reforms?

"Privatisation has been less controversial among Swedish trade unions than it is in many other countries," explains Samuel Engblom of Sweden's TCO, the Trade Union Confederation.

"Some trade unions have even embraced it," he says, adding "they see it as a possibility for their members to have a choice of employers, and hopefully a way to get wages up."

It is clear that Swedish unions have little in common with British ones. They have even been known to cut their own working hours if that means saving jobs in the long term.

"It's because the unions are so big and so strong that we can afford to be pragmatic and constructive," believes Samuel Engblom.

Tell that to Margaret Thatcher and Arthur Scargill.

'Swedish theory of love'

The fact is there is mutual trust between Swedish unions and employers and Scandinavian countries rank highest in the world when it comes to social trust - 70% of Swedes say they trust one another; just 35% of Brits feel the same way.

Image copyright AFP Image caption The trust between Swedish citizens ranks among the highest in the world

That trust allows Swedish governments to make bold decisions that would be met with apprehension or cynicism in Britain.

It stems from a unique relationship between the individual and the state established back when most of Europe was operating a feudal system.

Swedish peasants were unusual in owning their land says Lars Tragardh, professor of history at Ersta Skondal University College in Stockholm.

When the nobles wanted to subjugate them, the peasants united with the king to defend their freedom.

"So, there has been this long-standing positive view of the state as the vehicle for liberating individuals from these ties of dependency," says Prof Tragardh, "this has been the critical dynamic in the building of the welfare state."

If a woman depends on a man for income and wealth, how does either party really know that they are together because they love each other rather than that they need each other?" Prof Lars Tragardh, Ersta Skondal University College

The welfare state was designed to do away with dependency of all kinds: whether on charity - or even on family members.

Professor Tragardh calls it a "Swedish theory of love". It says that love can exist only when neither party is dependent on the other.

"If a woman depends on a man for income and wealth, how does either party really know that they are together because they love each other rather than that they need each other?" says Prof Tragardh.

The state is seen as the vehicle for achieving this autonomy, hence the Swedish model aims to get women into the workforce, provide a good education to equip children to fend for themselves, and take on the burden of caring for elderly people.

In other words, according to Lars Tragardh, "the state is there to provide fundamental resources that allow individuals to operate freely and competitively in the free society, including the market society."

Not so much the land of free love, as of the free market.

If we in the UK want to copy the Swedish model wholesale, we would have to rethink our attitude to the state and see it as a liberator rather than a threat to our freedom.

In other words, we would have to learn to love like a Swede.

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