Founded by August Palm (b. 1849, d. 1922) in 1889, its programme and organization were greatly influenced by the German Social Democratic Party (SPD). At the same time, it was always ready to provide pragmatic support for the dominant Liberals on matters of political and social reform. The party's strength greatly increased with the foundation of the Swedish Conference of Trade Unions in 1898, which has subsequently been the party's major organizational backbone. Its leader since 1892, Hjalma Branting, was elected to the Riksdag (parliament) in 1898, and from 1902 its number of seats grew steadily to 64 out of 230 by 1917. In that year the party received a major boost from the introduction of universal suffrage through a Liberal-Social Democratic coalition. It was not until 1932, however, that it could finally establish itself as Sweden's dominant political party, since it was the only party to have developed a consistent response to the Great Depression through Keynesian demand management and taxation in order to finance public works.
In its subsequent period in government which lasted until 1976 (interrupted only briefly in 1936), it developed a model welfare state that achieved great prosperity as well as a relatively equal income distribution. It was marked by generous benefit payments, a steep system of progressive income taxation, and close cooperation with the trade unions in economic matters.
Contemporary history (since 1980s)
Following the oil price shocks of the 1970s, which hit the country, with its lack of energy resources, very hard, the party underwent a period of uncertainty as its model of the welfare state became untenable. It stopped being the natural party of government and was out of office 1976–81 and 1991–4, as its conservative opponents argued convincingly for a reform of the welfare system, and became better organized. In the 1998 general elections it obtained 36.5 per cent of the popular vote, its worst ever electoral performance since 1921. Under Goran Persson, the party formed a series of minority governments from 1996, but in 2006, a right-wing coalition gained a small majority in the Riksdag. The party's inability to generate a majority in the face of a fragmented party system was part of a wider European political phenomenon. The growing popularity of non-traditional parties made it difficult for established parties to attract cross-generational, cross-regional, and cross-class majorities.
Subjects: Contemporary History (Post 1945).