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Socialism Like . . . Sweden?

 

A few months ago Ricochet member @mattyvan put up a great post about Sweden, Sweden. Lessons for America? , which included an hour long documentary about Sweden’s economy. Since then we have seen Alexandria Ocasio-Cortez become one of the most popular young Democrats and one of the oldest, Bernie Sanders, announce that he will run for president in 2020. With admitted socialist becoming more and more more prominent, it might be worth revisiting this topic.

While Cuba and Venezuela give us good examples of what socialism can do to a country, they do not exactly tell a happy story. So, the folks promoting “Democratic Socialism” are telling us to look to Sweden as an example of what we can do in America. The problem is, Sweden doesn’t really fit the model of what Bernie and company are trying to sell.

First, Sweden is not socialist. The government doesn’t own the means of production. It is a free-market economy.

Sweden does, however, have a huge welfare state and their people like it. Funding the welfare state takes a lot of money and you need a strong economy to create that wealth. Also, they found that government isn’t very good at providing the services people want so they have a more market approach to many of the benefits provided by the state. For instance, they have school vouchers that students can use to go either a public or private school. What might America’s so-called socialists think about that?

Another big disconnect between the Bernie/AOC form of socialism and the reality of what Sweden is doing is how the government is funded. In America politicians use the welfare state as a way to buy votes with other people’s money. They will tell you what you will get and then say it will be paid for by someone else. Someone who isn’t paying their “fair share.” The 1%, the 5%, the 10%, whatever, just not you. In Sweden it is understood that if you want all of these benefits, everyone must pay for them. That means poorer Swedes pay a very high percentage of their income in taxes.

The main point is, if you want a huge welfare state, you have to be willing to pay for it. I do not believe there is consensus for that large of a welfare state in America and there is absolutely no serious willingness to fund one by either party.

In the video below you can see John Stossel give a brief synopsis of the documentary Sweden: Lessons for America? You can view the whole thing on Matty Van’s post or by clicking here.

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There are 34 comments.

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  1. Coolidge

    This is useful and I learned something about the Swedish economy. It’s obvious that people on the left are misusing the moniker to try to soft pedal socialism in America. Free markets work well, in Sweden and elsewhere. Good examples given in the video.

    • #1
    • March 3, 2019 at 1:23 pm
    • 3 likes
  2. Member
    Vance Richards Post author

    Ray Kujawa (View Comment):

    This is useful and I learned something about the Swedish economy. It’s obvious that people on the left are misusing the moniker to try to soft pedal socialism in America. Free markets work well, in Sweden and elsewhere. Good examples given in the video.

    I didn’t know anything about Sweden except that people would hold it up as an example of “good socialism”. The truth isn’t that simple.

    • #2
    • March 3, 2019 at 1:53 pm
    • 1 like
  3. Member

    If Sweden was a state in the USA it would be the poorest state.

    • #3
    • March 3, 2019 at 2:29 pm
    • 5 likes
  4. Member

    Sweden is also populated mostly by Swedes, people who are relatively homogenous genetically and have a long relatively common cultural history that encourages certain behaviors and attitudes, and discourages other behaviors and attitudes. 

    The not-very-nice (but fun) response to someone who says the United States should become more like Sweden is, “So what are you going to do with all the darker skinned and not-blonde people who don’t come from a long Scandinavian genetic and cultural history?”

    • #4
    • March 3, 2019 at 3:01 pm
    • 6 likes
  5. Member

    Sweden has the advantage of having fewer American university/media/celebrity leftists than we do. Less hate.

    • #5
    • March 3, 2019 at 3:42 pm
    • 4 likes
  6. Coolidge

    Full Size Tabby (View Comment):

    Sweden is also populated mostly by Swedes, people who are relatively homogenous genetically and have a long relatively common cultural history that encourages certain behaviors and attitudes, and discourages other behaviors and attitudes.

    The not-very-nice (but fun) response to someone who says the United States should become more like Sweden is, “So what are you going to do with all the darker skinned and not-blonde people who don’t come from a long Scandinavian genetic and cultural history?”

    Yeah, that’s a valid question — Sweden and other Scandinavian countries have been changing demographically by major influx of refugees from the ME, but that doesn’t play into the reason their economy has become what it did and saved them from their 70’s flirting with Socialism/state run economy. So I can understand why they were probably invisible in the video, which was more like a primer on how Sweden’s government and economy worked to address basic questions without introducing unnecessary complexity into the short discussion. But given sufficient critical mass of refugees, whom I assume at some point would qualify as voting Swedish citizens with decidedly different values about how society is supposed to work, it’s conceivable there could be a change in sentiment for more centralized planning. This is where education becomes important.

    • #6
    • March 3, 2019 at 9:49 pm
    • 5 likes
  7. Member

    Every leftist should take a look at the locations of America and Sweden on the Index of Economic Liberty.

    • #7
    • March 4, 2019 at 2:35 am
    • 3 likes
  8. Member

    Ray Kujawa (View Comment):

    This is useful and I learned something about the Swedish economy. It’s obvious that people on the left are misusing the moniker to try to soft pedal socialism in America. Free markets work well, in Sweden and elsewhere. Good examples given in the video.

    The Swedish socialists were smart enough to realize that it was easier to graft their socialist welfare state onto a healthy host, rather than kill the host outright and institute “true socialism”. They slowly larded on more and more socialism until by the mid 1970’s they were well on their way to killing the host after all.

    • #8
    • March 4, 2019 at 5:02 am
    • 7 likes
  9. Member

    PHCheese (View Comment):

    If Sweden was a state in the USA it would be the poorest state.

    I don’t think that this is correct.

    According to Wikipedia (here), 2017 GDP per capita in Sweden was 51,125 nominal and 49,759 PPP.

    Even using the lower PPP figure, this is higher than the 2018 GDP per capita in 12 states. Four states are under $44,000. (Here – look at the second chart, as the first is in 2009 dollars.)

     

    • #9
    • March 4, 2019 at 6:48 am
    • 1 like
  10. Member
    Vance Richards Post author

    New York Post has an editorial up showing that, while there is growing support for socialism among the American Left, most don’t even know what socialism is.

    Gallup reports that 57 percent of Democrats have a positive view of socialism. But do they even have any idea what they’re talking about? The same poll shows respondents supporting small business and free enterprise and rejecting the idea that government is doing too little.

    • #10
    • March 4, 2019 at 9:46 am
    • 5 likes
  11. Member

    Vance Richards (View Comment):

    New York Post has an editorial up showing that, while there is growing support for socialism among the American Left, most don’t even know what socialism is.

    Gallup reports that 57 percent of Democrats have a positive view of socialism. But do they even have any idea what they’re talking about? The same poll shows respondents supporting small business and free enterprise and rejecting the idea that government is doing too little.

    yeah. Their concept of “socialism” is “lots of free sh#t”…..

    • #11
    • March 4, 2019 at 12:10 pm
    • 6 likes
  12. Coolidge

    Sweden also spends 1% of their GDP on defense. Compared to the United States 3.29%. It’s much easier to pay for massive welfare programs when other countries subsidize your national security. Democratic Socialists never grasp this. If Russia invades Sweden tomorrow, you better believe US dollars are coming to their aide.

    • #12
    • March 4, 2019 at 12:34 pm
    • 9 likes
  13. Coolidge

    It is incorrect to state that the tax code in Sweden is regressive in terms of having the poor pay too much of their income-based taxes in income.

    Rather what happens is that income-based tax codes are quite fair. There are no Warren Buffets in Sweden explaining that their secretaries pay a higher percentage in income taxes than they do.

    However what is insisted on in Sweden as well as most other European nation states is a system of taxes called VAT. (Value added taxes.) So if you are fond of going into a book store and buying new books for yourself, you will find yourself faced with a VAT that increases the cost of any new book substantially. After all, no one needs a brand new book in order to survive. (Almost any book in any society can be obtained at 50% of its costs some 90 days after it is released.)

    Consuming liquor and eating at restaurants will also absorb a good deal of a person’s income if they view those activities as necessities for their life style, because liquor and restaurant meals incur huge VAT taxes..

    • #13
    • March 4, 2019 at 1:14 pm
    • 3 likes
  14. Member

    CarolJoy, Above Top Secret (View Comment):

    It is incorrect to state that the tax code in Sweden is regressive in terms of having the poor pay too much of their income-based taxes in income.

    Rather what happens is that income-based tax codes are quite fair. There are no Warren Buffets in Sweden explaining that their secretaries pay a higher percentage in income taxes than they do.

    However what is insisted on in Sweden as well as most other European nation states is a system of taxes called VAT. (Value added taxes.) So if you are fond of going into a book store and buying new books for yourself, you will find yourself faced with a VAT that increases the cost of any new book substantially. After all, no one needs a brand new book in order to survive. (Almost any book in any society can be obtained at 50% of its costs some 90 days after it is released.)

    Consuming liquor and eating at restaurants will also absorb a good deal of a person’s income if they view those activities as necessities for their life style, because liquor and restaurant meals incur huge VAT taxes..

    And all VAT taxes and sales taxes are regressive, no matter how much they are jiggered in an attempt to make them otherwise.

    • #14
    • March 4, 2019 at 1:45 pm
    • 5 likes
  15. Member

    Haven’t spent three years in Sweden (loving every minute of it) I can attest to the accuracy of this post and the general line of thinking.

    A couple more salient points: Swedes, and Sweden until about ten-fifteen years ago, are an extremely homogenous people. They all do the same things and think the same way. Even when they rebel, they rebel the same way. It’s a society built on consensus, especially in the government. Decisions can take two or three years to get done, but once the consensus is agreed-to, that’s that.

    Swedes have a very low savings rate. They do not need to save for health care, education , or old age — all those benefits are provided for. In essence, they have been paid for by people since they started working through their high taxes. There is a consensus on this, everybody agrees to it. Basically, all Swedes have to save for is their car, hopefully their second car, a vintage American model that they keep in the garage at their stuga (summer cabin) which they use two months out of the year because that’s all they have for summer, and their winter vacation to somewhere sunny.

    Housing is quite expensive, and has been a main government priority for generations. Nowadays, the problem is that everybody wants to live in the middle of Stockholm. Sorry, they can’t. There is only a limited amount of space in the city. In the 1960s, chunks of downtown Stockholm were torn down, and lovely, solid old buildings were replaced by taller, modern ones. All Swedes now acknowledge that this was a mistake and a loss. But they still want to live downtown. The government built well-planned suburbs around metro stops and train stations; taller buildings at the center, then apartments, then individual homes. These are usually quite nice, even the suburbs where more immigrants live. These are still perfectly nice neighborhoods and not ghettos, but they are starting to run down.

    Other cities in Sweden worry about people leaving their town for the Big City, which would be either Stockholm or Gothenburg, and maybe Malmo. Remember: outside the three big cities, no other city has many more than 150,000 people. The university town of Uppsala had 156,000 people in 2015, and is in commuting distance of Stockholm. The next city on the list, Uplands Väsby/Sollentuna, is suburban Stockholm. The tenth-ranked city, Norrköping, has less than 100,000 people. These places worry about competing with the Big City. Municipalities are happy to build sports arenas, with the full knowledge and honest admission that they will not pay for themselves (unlike what developers say in the U.S.) but consider them civic amenities that they are willing to pay for.

    Most spending decisions, including on health and social welfare, are done at the local level, again, after long consultation. This should make small-government conservatives happy. As far as I remember, revenues come from the national government, allocated by a formula. Less-developed or less-advantaged municipalities, like those in the far north, get a little more. This is to ensure that, per the national consensus, everybody is taken care of equally. The selection of groceries in a small, northern town like Kiruna, will essentially be the same as any other town in Stockholm (although I would image that in Kiruna, the reindeer meat might be a little cheaper). Many of these towns are dominated by one industry; many have their roots in being factory towns. Because these towns are relatively small and homogenous, and everybody is alike, it’s easier to come to agreement on policy issues. This contributes to Sweden’s low level of corruption. Everything is transparent. The only big corruption scandal I’m familiar with is some problem that they had at the Systembolaget, the national alcohol retail monopoly.

    The biggest threat to this consensus is the high level of immigration into Sweden in the past ten-fifteen years. Sweden spends a lot of money on integrating immigrants, from providing housing, language classes, vocational classes, to taking care of immigrant children from the age of two in the very extensive Swedish day-care system. Sweden is a very complicated country to live it; it took me a long time to figure out how to get things done. It is hard for any immigrant to figure things out, much less uneducated persons from underdeveloped countries. Many of these people drift in to occupations common to immigrants anywhere, like shopkeeping or delivery, but the number of those low-wage jobs are limited. They just don’t exist in the economy. (The Swedish labor market is regulated in such a way that pushes wages up, essentially limiting opportunities for low-skilled workers. Also, there are fewer service jobs in Sweden. For example, almost no restaurants, not even pizza parlors, deliver. It’s a country where you have to do a lot of things yourself because there’s no one to help you.)

    Apart from the very real concerns of “will these people assimilate?” (some have, quite well, some are having more trouble), the costs of social spending far outweigh any economic contribution these people are likely to make in the near future. More importantly, these “New Swedes” are threatening to overwhelm the consensus that has been the foundation of Swedish society for the last hundred years. Sweden is frankly one of the least-well-suited countries to become diverse than I can think of — the homogeneity and consensus-basis of society makes it very difficult to change. This challenge is not of their own making, it has been thrust on them, but their leaders have chosen to take on this burden without getting consensus from the vast majority of the Swedish people, which is the only way this can work. Twenty percent of the electorate are so opposed to this that they voted for a party whose name cannot be spoken in polite Swedish society. There are certainly more Swedes who voted for other parties that are similarly not supported of these higher levels of immigration. Continued high levels of immigration are a definite threat to the consensus-based foundation of Swedish society.

    • #15
    • March 4, 2019 at 2:18 pm
    • 11 likes
  16. Member

    Vance Richards (View Comment):

    New York Post has an editorial up showing that, while there is growing support for socialism among the American Left, most don’t even know what socialism is.

    Gallup reports that 57 percent of Democrats have a positive view of socialism. But do they even have any idea what they’re talking about? The same poll shows respondents supporting small business and free enterprise and rejecting the idea that government is doing too little.

    In the American vernacular, “Socialism” means, “I get free stuff and that SOB over there is going to pay for it.” Progressives are liars: they know that they cannot deliver what they are selling. Once they make the sale, we’ll have high taxes, rationing, and no stuff at all.

    • #16
    • March 4, 2019 at 2:22 pm
    • 7 likes
  17. Member

    Leftists don’t care that Sweden has much less corruption and has a strong free-market economy. They care about big government and they will use any argument, sensible or not, to make the government bigger government is their G-d. The government is love and goodness incarnate and Capitalism is unclean and filthy. 

    • #17
    • March 4, 2019 at 3:26 pm
    • 4 likes
  18. Member

    Honestly, do you think these people want a Soviet social and economic system or a Swedish social and economic system? Getting hung up on semantics (socialist? Democratic socialist? What do we mean by these terms?) doesn’t really address that. 

    • #18
    • March 5, 2019 at 1:46 am
    • Like
  19. Member

    Zafar (View Comment):

    Honestly, do you think these people want a Soviet social and economic system or a Swedish social and economic system? Getting hung up on semantics (socialist? Democratic socialist? What do we mean by these terms?) doesn’t really address that.

    Except voters are being asked to fundamentally transform a country, it is entirely reasonable for the voters to demand to know into what the result of the fundamental transformation will be. Politicians and activists advocating for some version of “socialism” are being very obtuse about what their version is. 

    And, yes, I think many of them do want a Soviet social and economic system in which they rule over everyone else.

    • #19
    • March 5, 2019 at 5:09 am
    • 6 likes
  20. Member
    Vance Richards Post author

    Zafar (View Comment):

    Honestly, do you think these people want a Soviet social and economic system or a Swedish social and economic system? Getting hung up on semantics (socialist? Democratic socialist? What do we mean by these terms?) doesn’t really address that.

    Bernie has praised the Soviets in the past, so I am not sure what he wants. As for the younger ones who do not remember the USSR I would ask:

    Do they want school choice with vouchers that go where the student goes, or do they want government controlled schools?

    Do they want to privatize Social Security? Remember what happened when W suggested letting people invest a tiny percentage of their Social Security.

    Do they want Social Security benefits to go up or down based on economic performance or do they want guaranteed increases and COLAs?

    Do they want a 20-30% VAT on all goods and services (which would hurt the lower income earners the hardest) or do they want a select few to pay for the entire welfare state?

    The issue is not semantics, it is logistics. Can you provide a Swedish style welfare state without Swedish style funding and free-market reforms? There are not enough “rich” to support the rest of the people. How do you get the welfare state they want without destroying the economy? The Swedish model, from the 70’s and 80’s, tells us it probably cannot be done.

     

    • #20
    • March 5, 2019 at 5:17 am
    • 4 likes
  21. Member

    Vance Richards (View Comment):

    Bernie has praised the Soviets in the past, so I am not sure what he wants. As for the younger ones who do not remember the USSR I would ask:

    Do they want school choice with vouchers that go where the student goes, or do they want government controlled schools?

    They are both socialism (ie redistribution of wealth), and who pays says, so they would be Government controlled schools in both cases. (The moment a Government says you can’t use school vouchers to go to Voodoo Academy that’s control – and probably a good thing too.)

    It’s my belief that delivering welfare benefits (paid for by the public purse) via the free market is usually much more efficient if done honestly. And arguably it avoids the problems intrinsic to bureaucracies (though it also may encourage equivalent problems intrinsic to corporations?).

    The thing is, at this point we’re discussing which kind (or methodology) of socialism is better – and it’s a really meaningful discussion – rather than whether there is a benefit to society from all of us ensuring (with our taxes) that the next generation gets educated (which is socialism) rather than letting them sink or swim according to what their families provide for (which is not).

    I would agree that it isn’t your mother’s socialism (which was all about Govt providing the welfare product directly), but I’d argue that it’s the acceptance of the welfare product (eg education) that defines socialism rather than how the product is delivered (which is detail).

    Ditto with the minimum wage. That’s outsourced socialism – what the Soviets first delivered (or tried to) via State ownership of the means of production (and this proved totally unworkable, yes, due to a bunch of stuff to do with human nature) Sweden (and frankly the US and just about the whole of the West) delivers a lot more efficiently by legislation that gets the free market to provide it. (At least that’s the theory.)

    • #21
    • March 5, 2019 at 5:49 am
    • 1 like
  22. Member

    Full Size Tabby (View Comment):

    And, yes, I think many of them do want a Soviet social and economic system in which they rule over everyone else.

    I do hope not. Between you and me that doesn’t seem realistic about most people who would like more socialism in America.

     

    • #22
    • March 5, 2019 at 5:51 am
    • 1 like
  23. Member

    Of course Sweden, along with all the Nordics, enjoy freer economies than the US. But they’re nordic and they’er tiny so they were able to come back from the drift left which never reached the level of government control we already have in the US. They’re too small to be truly socialist, unfortunately we’re not.

    • #23
    • March 5, 2019 at 6:45 am
    • 2 likes
  24. Member

    Zafar (View Comment):

    Honestly, do you think these people want a Soviet social and economic system or a Swedish social and economic system? Getting hung up on semantics (socialist? Democratic socialist? What do we mean by these terms?) doesn’t really address that.

    I agree that getting hung up on the semantics is a trap. As to what these people want, that isn’t nearly as relevant as what they will give us when we resist. Whether they will end up going full Pol Pot on us, I don’t know, but I fear that outcome from them more than I would fear it from Swedish socialists or Soviet communists.

    • #24
    • March 5, 2019 at 7:26 am
    • 1 like
  25. Member
    Vance Richards Post author

    Vance Richards: The main point is, if you want a huge welfare state, you have to be willing to pay for it. I do not believe there is consensus for that large of a welfare state in America and there is absolutely no serious willingness to fund one by either party.

    With $22T in debt it is safe to say Americans are not willing to pay for our current welfare state. To fund a greatly expanded government we would need huge tax increases on everyone. If you think we just need an elect few to “pay their fair share” then you must be a math denier.

    • #25
    • March 5, 2019 at 9:27 am
    • 5 likes
  26. Coolidge

    The Reticulator (View Comment):

    CarolJoy, Above Top Secret (View Comment):

    It is incorrect to state that the tax code in Sweden is regressive in terms of having the poor pay too much of their income-based taxes in income.

    Rather what happens is that income-based tax codes are quite fair. There are no Warren Buffets in Sweden explaining that their secretaries pay a higher percentage in income taxes than they do.

    However what is insisted on in Sweden as well as most other European nation states is a system of taxes called VAT. (Value added taxes.) So if you are fond of going into a book store and buying new books for yourself, you will find yourself faced with a VAT that increases the cost of any new book substantially. After all, no one needs a brand new book in order to survive. (Almost any book in any society can be obtained at 50% of its costs some 90 days after it is released.)

    Consuming liquor and eating at restaurants will also absorb a good deal of a person’s income if they view those activities as necessities for their life style, because liquor and restaurant meals incur huge VAT taxes..

    And all VAT taxes and sales taxes are regressive, no matter how much they are jiggered in an attempt to make them otherwise.

    Many studies done here in the US show they are not regressive. Of course, the people they affect the most are people who have the most, and who are not used to paying taxes. So I can understand reluctance on their part.

    • #26
    • March 5, 2019 at 12:33 pm
    • Like
  27. Member

    Zafar (View Comment):

    Honestly, do you think these people want a Soviet social and economic system or a Swedish social and economic system? Getting hung up on semantics (socialist? Democratic socialist? What do we mean by these terms?) doesn’t really address that.

    There is irony in the historic denunciations by conservatives and Republicans of welfare state Democrats as socialists, when they really had no interest in imposing textbook socialism, contrasted with observations by conservatives and Republicans that today’s Socialists don’t know what they are talking about because they don’t really want to install textbook Socialism. We play the game too, pod people.

    • #27
    • March 5, 2019 at 1:22 pm
    • Like
  28. Member

    CarolJoy, Above Top Secret (View Comment):
    Many studies done here in the US show they are not regressive. Of course, the people they affect the most are people who have the most, and who are not used to paying taxes. So I can understand reluctance on their part.

    It has been a few years, but all studies i have seen say they are regressive and none say otherwise. If you have more up to date information i would appreciate a link. 

    • #28
    • March 5, 2019 at 1:33 pm
    • Like
  29. Coolidge

    SecondBite (View Comment):

    Zafar (View Comment):

    Honestly, do you think these people want a Soviet social and economic system or a Swedish social and economic system? Getting hung up on semantics (socialist? Democratic socialist? What do we mean by these terms?) doesn’t really address that.

    There is irony in the historic denunciations by conservatives and Republicans of welfare state Democrats as socialists, when they really had no interest in imposing textbook socialism, contrasted with observations by conservatives and Republicans that today’s Socialists don’t know what they are talking about because they don’t really want to install textbook Socialism. We play the game too, pod people.

    And a big worry for us is that these New Left progressive/socialists are really Maoists or “Cambodia Day One culture vandals” is growing.

    The way the New Left has captured the language, insisting on “safe spaces” so special people from minority status races will not be obliged to interact with the non-human white people, established Asians and African Americans is troubling. This would have been called out as segregation even ten years ago. Free speech needs to go away, they proclaim, as it is really hate speech. Anyone familiar with history knows that the ending will not be good. Whether it will be a Nazi-fied USA, or a Maoist-style America, or a Cambodia-style killing fields, no one without a working crystal ball can really say. (I thank Mark Steyn for introducing me to the use of “Cultural vandals” and “Cambodia Day One”)

    • #29
    • March 5, 2019 at 1:45 pm
    • 1 like
  30. Coolidge

    I Walton (View Comment):

    Of course Sweden, along with all the Nordics, enjoy freer economies than the US. But they’re nordic and they’er tiny so they were able to come back from the drift left which never reached the level of government control we already have in the US. They’re too small to be truly socialist, unfortunately we’re not.

    Yes it is very helpful that each Scandinavian nation has a tiny population. When I lived briefly in Norway in late 1970’s, Norway had around 3 million people. Corruption can be handled and reigned in much more efficiently under such a small system.

    Compare the headache of auditing the state of California and its 42 million people against a nation state of Norway, with 5.2 mil, and you can realize what I mean. And how would anyone audit the US Fed Budget? Catherine Austin Fitts has talked about how the US budget as it exists doesn’t allow for audits.

    • #30
    • March 5, 2019 at 2:02 pm
    • Like
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