Norway: Cost of living constantly rising amid energy crisis

Jens Stoltenberg - a former NATO director and Norwegian Prime Minister, appointed governor of Norway's central bank (Photo: Wikimedia Commons)

The covid pandemic has opened the eyes of many in Norway. There have been discussions over what the state has to pay to private (profit-making) drug companies for the vaccines. This winter has also seen the doubling or trebling of the price of electricity. Rents have been going up, supermarkets have had supply chain problems and there is even a paper shortage in the newspaper industry.

Many members of the health service workers’ unions are starting to make demands for better wages. We already see the contours of the wage struggles of previous years. The main ‘moderate’ unions in the LO (TU confederation) together with the more moderate wing in the Workers’ Party (AP), will want moderation in wage demands. But some, like members of the nurses’ union, the health workers, teachers union (UNIO), and the electricians in ELogIT, are willing to push against this to try and get a higher percentage wage increase.

Jens Stoltenberg has been appointed the governor of the central bank of Norway. Hiring Jens Stoltenberg – a well-known right-winger, former NATO director, and a one-time AP Prime Minister – as central bank governor will create problems for some trade unions in Norway. We will see the use of anti-trade union rhetoric. The discredited idea of a tripartite agreement will be used time and time again, and even the much-hated ‘Tvungetlønnsnemd’ (‘Binding pay tribunals’). The unions should be making a more concerted effort to make this tribunal more democratic or even try to scrap it.

When the Central Bank governor was a normal pro-capitalist appointee, things were more black and white. Hiring Jens Stoltenberg, a discredited former AP prime minister, for this job will only muddy the waters. Once again, the unions and the left will be blamed in the media when Stoltenberg enforces wage restraint to the benefit of industrial capital, leading to even more union apathy.

The Tripartite Agreement

For decades now, The Tripartite Agreement has been the policy of the moderate right-wingers of the Norwegian Workers’ Party when they have been in office and has had some traction in the Trade Unions in the Norwegian TUC (LO). It is mainly used by the AP and LO to keep workers in line and to not demand more than a low percentage wage rise. The Tripartite Agreement is a sham, only being adhered to by the LO; for the other two parties, it is business as usual.

The bosses are supposed to keep prices down because the workers elect to follow the agreement. The state is supposed to keep the hospitals, schools, and services going and even the price of energy affordable. These things are patently not being done; only the workers via their trade unions in the LO are keeping their side of the agreement.

Some unions have fought against this kind of agreement with some success. The elevator workers’ union, the North Sea oil-workers, and, until a few years ago, the airline pilots’ union, have shown the way.

Blaming inflation on wage increases fought for by the unions has been discredited. South American countries like Argentina suffer low wages but high inflation and it is made out to be the workers’ fault if the price of electricity is fluctuating. Last autumn, electricity costs were around 0.35 kroner per kilowatt and sometimes now it can be as high as 1.5 kroner per kilowatt.

One of the effects of the tripartite agreements and tribunals is the staggeringly low trade union membership in Norway. Workers would often complain: “We can never win when get these restrictions, let’s tear up our membership cards!”

The Tripartite agreements must be defeated through militant trade union action: no bi-partisan deals with the bosses. The tvungetlønnsnemd (tribunals) must also be opposed with militant trade union action. The unions must call for demonstrations and appeal to their trade union-sponsored MPs and representatives to get them scrapped.

The great Norwegian energy crisis 2022

What was handed over by the outgoing conservative government was an EU deal where, by the use of sub-sea cables, energy was sold often at spot prices to speculators on the continent (mainly in the UK and Germany). Initially, we were told that, because the dams were low on water, the price had to be increased. This is a fallacy. The costs are to do with the building of international cables – often submarine cables which are very expensive to lay. The price of these cables has to be paid for by the Norwegian state and the price passed on to us.

In the eight years of the previous conservative government, we saw the previously state-owned electrical energy market sold off to private speculators. But it is not as simple as it at first seems. Most of the hydro-electric dams are still owned by the municipalities. These were built between the turn of the nineteenth century and WW2. They were run by and for the ratepayers in most towns and even villages. The great grandparents and grandparents of the current generation paid for the building of these monumental hydro-electric dams when Norwegians were one of the poorest people in Europe.

In the weeks from the New Year to now, there have been spontaneous demonstrations in most major cities – the biggest on a weekday evening in Oslo. The ruling coalition government was forced to pay out a lump sum to everyone, including farmers and small businesses, to offset these cost of living increases. The huge profits of the electrical speculators still come into the coffers of these profiteers.

These energy deals with the EU and also with speculators have to be scrapped!

Only by taking the energy sectors of the economy into public ownership, under democratic management, and control, along with the other major planks of the economy, can energy costs be kept low and living standards massively improved.


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February 2022