Letters From the Land of “Ruthless Capitalism”—Sweden and the Nordic Countries

 

 

By Sigrid Weidenweber

Sometimes interesting things arrive at my desk in a round-about way. Since I peruse the Wall Street Journal consistently and believe that I miss very little of interest, I was taken aback to receive the following report from my Swedish friend, Helle, residing in Portland, Oregon. It was an interview by London based Adam O’Neil with

Johan Norberg in Gothenburg, Sweden. The reason for the interview was to ascertain the truth about “Nordic Socialism,” the beloved term spewed about by the American left when trying to sell Socialism as an appealing notion. Trying to define the term Socialism, O’Neil finds that the term means different things to different people.

A leftist podcast host defined the matter thusly,

“For some it is a Nordic-Style welfare state. For others it is the liquidation of the capitalist class and democratization of the means of production.

Well, well—in my arsenal of information, the liquidation of the capitalist class and the appropriation of the means of production is the definition of totalitarian communism. When Cynthia Nixon, an actress running for governor of New York, was asked to define her understanding of what kind of Socialist model should be followed, she declared, that she is more in line with the Nordic Model.” Alexandria Ocasio-Cortez (AOC), also “likes the Nordic Model,” thereby proving that no politician ever dares admit that they would prefer the examples of Cuba, East-Germany or China. They all talk about the sugar plums of free food, free health care, jobs for all, free college—never mind your qualifications, and six-month bonding vacation with your newborn.

Mr. Norberg, a Swedish author and historian at one time believed himself to be an anarchist—not comfortable either with the right or the left. He states that then, in the early 19th century, Swedish politicians and intellectuals looked to America as a model for economic prosperity and freedom for the people to act. It was the time when most Swedes were eager to leave Sweden for America. During the period of 1840 till 1870 classical liberals took political power in Sweden. Mr. Norberg credits them with wisdom. “They did basically everything right: save property rights, open businesses, free trade, beginning to open up for religious freedom, freedom of the press.”

Sweden began to prosper through these freedoms. For nearly a century Sweden was one of the fastest growing countries in the world. But by the 1960’s the country took the wealth-creating apparatus for granted and the left put forth the notion, “Now that we are that rich. Should we not just distribute it, and give it to the places and the people we like?” Such was the thinking of the Swedish dominant center-left Social Democratic Party. Mr. O’Neil reminds us that New York Mayor Bill de Blasio remarked in this same vein, “there is plenty of money in this world, it’s just in the wrong hands.”

Following the new Socialist dictates, the Swedish state doubled the amount of government spending. They did this between 1960 to 1980. Entrepreneurs left in droves. Private sector employment declined, disposable-income and economic growth was slow. Some of the country’s best companies and brightest minds fled because of an onerous inheritance tax.

I remember spending a long winter vacation in Sweden during these years and saw first-hand how people evaded the evils of over-taxation. Arriving in the mountains of Goetaland, in early December, my husband and I were surprised that we could not find rooms in in this faraway place bereft of any amenities provided by a resort or ski area. No ski-slopes, no ski lifts or plowed cross-country trails. We found one room in a very nice, pricy hotel for one night only. Of course, I had to inquire immediately why the hotels were so busy. The manager moved me out of earshot and explained. “It is because of Socialism. Some companies wishing to keep their employees happy cannot pay them higher salaries because that puts them in a higher tax class. So, it is understood that they get perks in the form of a fourteen-day stay in the mountains. We have a health center, a pool, a sauna, massage center and great food. They come here under the pretext of attending seminars. In the morning they might receive a few hours of instruction, but the rest of the time they are pampered. The company can write the expenses off as necessary training, and no one is the wiser. They could not do that in a resort town. The government would know.”

My husband and I met doctors who traded services with plumbers and gardeners; a computer wizard traded services with an architect, et cetera, etc. You can imagine how much value was circulated without a taxable Krona spent.

Things changed in Sweden with the arrival of Prime Minister Carl Bildt. Mr. Norberg credits Prime Minister Bildt, who understood free market principles, with the turning around of the Swedish economy. The top marginal income tax, for example was reduced from 90% to about 50%. That is an enormous cut. Mr. Norbert states, “One thing the left gets wrong is that they think Sweden has this sort of warm, friendly, fuzzy capitalist thing—no layoffs, no fierce competition, protecting the old companies, and so on. And its really the total opposite.”

Mr. Norberg then talks about the dirty little secret no one of the American left wants to talk about. It concerns the Swedish gross domestic product being 16 points higher than in the US, derived from non-progressive taxes on consumption, social security and payroll taxes that amount to 27%.

Swedish healthcare is another egregious assumption bandied about by the left. It is not a Medicare for all thing, as America seems to think. Mr. Norberg points out that it is not even a national system but a regional system.

“We had problems with productivity and investment into the health-care sector. So, now we have more freedom of choice and more competition.”

Weil the progressive left clamors to put all healthcare into the hands of the government, one of the biggest hospitals in Stockholm was privatized. The interview with Norberg ended with a dire warning for America sent to Mr. O’Neil a few days later. It is so dire I quote verbatim.

“The most dangerous place to be is on top of the world, think you have it all made and can afford to experiment with socialism and protectionism, because you have plenty of room for mistakes before you hurt yourself. That’s where Sweden was in 1970. It almost destroyed us, and it took some heroic efforts to get back on track.”

I must cite a few more comments by Mr. O’Neil about other Nordic countries. “Denmark is far from a socialist planned economy,” said its Prime Minister Lars Lokke, rebutting unwelcome praise from Mr. Sanders in 2015. “Denmark is a market economy.”

Being asked by Mr. O’Neil if Finland was a socialist country, Finnish President Sauli Niinistoe replied, ”No, God bless.”

Norway is similar in concept and, oh horror, a major producer of fossil fuels. I visited Norway last year and was told by a friend that their system had been built on a two person per family tax system that had worked to everyone’s happiness until now. My friend said,” We now have many Muslim families with many more children than the two or three in our culture, and the wives are not allowed to work by their husbands. So, no income taxes for the system. Eventually that will break the social camel’s back.”

International worker’s day celebrated by social democrats in Sweden. Downtown Gothenburg in front of the art museum. People marching with banners and musical instruments. Dreamstime

The views and opinions expressed in this commentary are those of the author and do not necessarily reflect the official position of Citizens Journal.


 Sigrid Weidenweber grew up in communist East Berlin, escaping it using a French passport. Ms. Weidenweber holds a degree in medical technology as well as psychology and has course work in Anthropology.  She is co-founder of Aid for Afghans.  Weidenweber has traveled the world and lived with Pakistani Muslims, learning about the culture and religion. She is a published author and lecturer. You can find her books on Amazon.com


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