Sweden once enjoyed the reputation of being the modern society - successful economically and socially, steering a 'middle way' between capitalism and socialism. Even during the 1980s, it maintained a commitment to full employment and a high standard of state welfare. The work presented here - published between 1988 and 1996 - describes the way in which the country has faced a series of real and perceived threats from inside and outside its boundaries. While international competition and globalisation have brought about major economic changes with consequences for unemployment, public expenditure and the welfare state, there has also been a concern about the possibility of increased drug-taking, particularly amongst young people. The reaction to the former has been to make cuts in welfare benefits and services but to resist the dismantling of the 'People's Home'. The reaction to the drugs issue has been to follow an abstentionist policy - the restrictive line - with the aim of creating a drug-free society. Both the reluctance to concede the necessity of restructuring the welfare state and the creation of a moral panic around drugs, can be explained by a cultural defence of values which are important to Swedish society - rationality, order and sobriety. Section I of this submission is concerned with the development of drug policy; section II with the decline of the welfare state.