Sweden: Conservatopia
HT: Via faithful commenter and occasional guest poster Ward Smith, the provocative Executive Summary of a paper by Nima Sanandaji, who according to his bio is a Swedish author “with a Kurdish Iranian background.”
The surprising ingredients of Swedish success – free markets and social cohesion:
• Sweden did not become wealthy through social democracy, big government and a large
welfare state. It developed economically by adopting free-market policies in the late 19th
century and early 20th century. It also benefited from positive cultural norms, including a
strong work ethic and high levels of trust.• As late as 1950, Swedish tax revenues were still only around 21 per cent of GDP. The
policy shift towards a big state and higher taxes occurred mainly during the next thirty
years, as taxes increased by almost one per cent of GDP annually.• The rapid growth of the state in the late 1960s and 1970s led to a large decline in Sweden’s
relative economic performance. In 1975, Sweden was the 4th richest industrialised
country in terms of GDP per head. By 1993, it had fallen to 14th.• Big government had a devastating impact on entrepreneurship. After 1970, the
establishment of new firms dropped significantly. Among the 100 firms with the highest
revenues in Sweden in 2004, only two were entrepreneurial Swedish firms founded after
1970, compared with 21 founded before 1913.• High levels of equality and favourable social outcomes were evident before the creation of
an extensive welfare state. Moreover, generous welfare policies have created numerous
social problems, including high levels of dependency among certain groups.• Descendants of Swedes who migrated to the USA in the 19th century are characterised
by favourable social outcomes, such as a low poverty rate and high employment, despite
the less extensive welfare state in the USA. The average income of Americans with
Swedish ancestry is over 50 per cent higher than Swedes in their native country.• Third World immigrants have been particularly badly affected by a combination of high
welfare benefits and restrictive labour market regulations. In 2004, when the Swedish
economy was performing strongly, the employment rate among immigrants from nonWestern nations in Sweden was only 48 per cent.• Since the economic crisis of the early 1990s, Swedish governments have rolled back the
state and introduced market reforms in sectors such as education, health and pensions.
Economic freedom has increased in Sweden while it has declined in the UK and USA.
Sweden’s relative economic performance has improved accordingly.
TVD: Who knew? As they say, read the whole thing.
You assured me that, while you could care less about print conventions in comments, you would scrupulously observe citation rules in main- and sub-blog posts.
There are paragraphs here which you did not write that are not indented, italicized, or otherwise marked off from what you did write as not your own. Lots of them.
I suppose the editors can decide whether this flies here or not.Report
Now annotated. Only the first and last paragraphs are mine. Thx for the objection, Michael.Report
Lookin’ good. Thank you, Tom.Report
I love the pic.Report
I can’t tell, is it supposed to be news that one of the OMG SOSHULIST EURO countries has free markets that work well. Okay that was a snarky response. But still. That is really not news at all. It is possible to combine free markets and social safety nets.
Social cohesion is an interesting idea. I’m for except it for the times i want to tell everyone to piss off and then i go off by myself. It’s much easier to be all for social cohesion when you feel you are in the dominant culture and SC means “everyone get with my program.” The US was sort of formed and settled by the dregs/exceptional people from all over Europe so we are by nature less cohesive. As we have expanded the people who can be fully American we now get people from all over the world. So how exactly are we supposed to be such and such socially cohesive when we are an immigrant nation says the proud grandkid of two sets of immigrants.
What exactly does social cohesion mean? Who is in charge of that? Who gives up their culture? When should my grandparents have stopped speaking yiddish and greek at home?Report
I am personally rather tired of arguments from Conservatives that just seem to amount to:
1. Americans are different.
2. Hence, America can’t have a welfare state like every other developed nationReport
Clearly America is too full of “immigrants from nonWestern nations”. Gosh, that’s subtle.Report
Tom, To what extent is Sweden conservatopia rather than libertopia? After all, its social policies AFAIK are liberal. i.e. it is liberal on a range of issues like gay marriage and abortion. I’m not sure how liberal it is on religious pluralism issues (do they ban burqas or headscarves?) Or how big they are with insisting on everyone speaking the same language. To the extent that the consensus they have over there on those issues differs from the consensus social conservatives in the US have on the same issues, to what extent does the conservatopia label really apply?Report
Yeah, honestly Sweeden is a classic case of neoliberalism, and a good model for what left-libertarian fusion would look like.Report
Sweden is an example both of the truth that a society which makes virtues of hard work and private responsibility will achieve economic health, and the truth that it’s possible to break that attitude if you give people enough money for doing nothing.Report
Yeah – conservatopia, fersure – with overall taxes after the big conservative “rollback” to ca. 47% of GDP from a high above 50% – so still around twice the US rate, and one of the highest in the world. Other ways of figuring taxation, such as those highlighted in the linked report, put the total rate even higher. Note also that Sweden’s total military spending is around 1.2% of its GDP, or around 1/4 the U.S. rate.
Can’t say I notice a lot of resemblance to what most conservatives in the U.S. have been pushing for. I’m kinda scratching my head as to what the relevance of Sweden or the report for us is supposed to be.Report
Do people on the left often point to Sweden as a “liberaltopia” of some sort? Almost every time I’ve heard Sweden mentioned, it’s been by conservatives. I could be wrong, though. It’s been a while since I hung out with any real Democrat-votin’ lubruhls.Report
I think people on the left point to Sweden – and Scandinavia in general – as an example of how to make a country both more socialist/liberal *and* more libertarian/conservative than the USA at the same time. Neoliberals, in particular (your Yglesii, etc), speak very highly of its ability to combine a robust social safety net with very, very free markets. If it’s any kind of -topia, it is, as James K points out, a neoliberaltopia or a liberaltariantopia.Report
The important thing for everyone to remember is that all opinions on everything need to fall into one of two pre-chosen sets, as determined by US political parties.
Otherwise it’s just chaos.Report
If it ain’t liberal or conservative, it’s un-American. Are you sayin’ that Sweden is un-American?Report
I’m pretty sure liberals are un-American too, though, right?Report
This reminds me of a point Russ Roberts from Econtalk makes occasionally. It seems that econmic debates in the US (and in many other countries too) collapse down to “should we be more like France or more like the USA?” Which is a pity, since neither model is very good. If we’re going with national analogues, a better question would be “should we be more like Sweeden or more like Singapore?”Report
Which is why the social cohesion thing is such an important aspect of this (as are comparisons to Swedish expat communities in countries which don’t have Sweden’s social model.) If the Swedish model works because you start out with people who make virtues of hard work on the community’s behalf and a refusal to depend on government-provided benefits, then that doesn’t tell us much about whether it’s a good idea to provide extensive government benefits that aren’t tied to hard work.Report
Yeah, you got it, Mr. Duck. More in Part Deux: The gov’t is more a Costco for social services than a mommy, and is considered worth the extra tax levy.
And the system collapses if people take more from the common treasury than they absolutely need. Here in America, it’s become take whatever you can get. The social web has a completely different dynamic.
Further, everyone in Sweden is expected to work and is considered a moocher if they do not. Here in America, we call that a residue of a leftover Calvinism, unmodern and mean-spirited.
Perhaps the most interesting part is how well those raised in Swedish culture thrive here in America. The equation isn’t political policy, its values and culture:
Swedes seem to do just fine under the American system as well; the question is really whether Americans could make the Swedish one work.Report
If you’re an ideologue convinced that what you believe must be true and pretty much exactly as you believe it, relieving you of any need to assemble relevant facts and put them in context, then Sweden is a shining proof that your ideology is correct. So among certain rightwing ideologues the possibility that European social democracy may have reached its economic and political limits under current conditions is proof that rightwing ideology is correct, even though the same “center right” government-slashers would view what the American conservatives favor as barbaric and inconceivable, and even though the same “conservative” European governance, if proposed for the U.S., would be attacked as treason, communism, and the dark night of tyranny extinguishing the last best hope of all mankind making the statues of the Gipper cry real tears.Report
An account of ‘relative economic performance’ that has no apparent acknowledgement of, say, World War II, the collapse of Bretton Woods, the rise of East Asian states on the GDP per capita table, etc., doesn’t seem particularly convincing.
And it seems strange to assert that the UK and USA didn’t participate in the same third-way revolution that Sweden did.
I doubt TvD doesn’t know that the only way to convincingly link long-term growth and redistributive policy is to drag out a lot of boring and impenetrable econometric techniques and statistical tables, so I’m not sure where this post was going.Report
Here’s the Wikipedia entry: http://en.wikipedia.org/wiki/Sweden#Economy
Relevant paragraph:
The 47% figure I gave in the prior comment was from a different source, possibly for a different recent year – a minor discrepancy, obviously. You can also find a handy chart comparing Sweden to other advanced economies over the last few decades in the Taxation in Sweden entry.Report
It would seem more appropriate to link to Conservapedia in comments to a post about Conservatopia, heh. http://conservapedia.com/Sweden
Extra special sections there about “the most atheistic country in the world” and tax subsidized abortion on demand, overall a surprisingly accurate portrayal by Conservapedia standards.Report