Let’s Stop Pretending Bernie Sanders Wants to Duplicate Scandinavia

 

Bernie Sanders supporters are quick to make clear that their guy doesn’t want to turn America into Cuba or Venezuela or the old Soviet Union. By “democratic socialism,” the US senator from Vermont means Scandinavia, more or less. And what’s wrong with that? The Nordic nations are pretty nice. Even President Trump has conceded that Norway produces a quality immigrant.

But does Sanders really want to import Scandinavian “socialism?” He brags that his universal health-care plan eliminates patient cost-sharing. But Scandinavia has it. Sanders wants to raise a lot of revenue through heavy taxes on business and investment. Scandinavia doesn’t. Sanders has a big problem with billionaires. Scandinavia doesn’t. Indeed, as I have written, “The egalitarian Nordic nations have as many billionaires, relatively, as the US and more concentrated wealth, at least as measured by the share of wealth controlled by the top 10 percent.”

I could go on and on, mentioning how the Nordics score highly in the conservative Heritage Foundation’s Economic Freedom Index, especially when it comes to government regulation. They’re also free traders, unlike Sanders, who opposed the North American Free Trade Agreement in the 1990s and its successor agreement today. As a JPMorgan analysis cautioned: “Copy the Nordic model if you like, but understand that it entails a lot of capitalism and pro-business policies, a lot of taxation on middle class spending and wages, minimal reliance on corporate taxation and plenty of co-pays and deductibles in its healthcare system.”

Here’s a tale of Scandinavian socialism that Team Bernie never tells, via a Milken Review Institute piece from Swedish economist Andreas Bergh:

In the 1970s, several well-intended political reforms backfired. The desire to increase income equality through high marginal tax rates and generous welfare benefits weakened work incentives and created strong incentives for tax avoidance. Indeed, in the 1970s and 1980s, many wealthy Swedes – notably Bjorn Borg – left the country to avoid the taxman. Meanwhile, the desire to tame the business cycle and minimize unemployment led to the subsidization of noncompetitive industries. The unions’ desire to drive wages ahead of productivity growth led to inflation, while efforts to restore Sweden’s competitiveness through repeated currency devaluations led to both a lower living standard and investment-sapping uncertainty.

Perhaps most important, the mix of subsidies and devaluations sent the signal that firms in trouble could turn to the government for help, rather than be forced to innovate in order to stay competitive. When that happens, economies inevitably pay a price. After the crisis of the early 1990s, the Swedish economy recovered smartly. In many ways, Sweden learned from its mistakes and took measures to avoid large budget deficits and inflationary wage pressures. By the mid-1990s, these changes were institutionalized – and strikingly, often with support from Social Democrats as well as the right-wing parties. Prominent examples include a tax reform that lowered marginal rates substantially and a pension reform that balanced the risks between pensioners and taxpayers by automatically adjusting payments to demographic and economic conditions.

Whatever Sanders wants to turn America into, it doesn’t sound much like Scandinavia as it exists in current reality. Then again, as that JPMorgan report concluded: “A real-life proof of concept for a successful democratic socialist society, like the Lost City of Atlantis, has yet to be found.”

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  1. Mark Camp Member
    Mark Camp
    @MarkCamp

    In the new year, the soil seems to be sprouting with causes for revived optimism.  And now, James writes an article that supports the cause of economic freedom.

    Bravo!

    • #1
  2. Henry Racette Contributor
    Henry Racette
    @HenryRacette

    Terrific post, timely and compelling.

    Thank you!

    • #2
  3. Nohaaj Coolidge
    Nohaaj
    @Nohaaj

    How Dare You! Confuse Socialist idealism with facts and reality.

    • #3
  4. James Lileks Contributor
    James Lileks
    @jameslileks

    Bernie Sanders is a charmless, hectoring, covetous man whose economic ignorance is matched only by his callous disregard for the millions of victims of the regimes he has championed. In his mind top-hatted plutocrats are still clubbing orphans with diamond-tipped walking sticks as they alight from their carriages to pass to their mansions, while earnest, beaming, selfless proles in the USSR are working together to increase the five-year-plan’s cement quota. If he got elected and the stock market went down 50%, he’d see it as proof he was doing the right things.

    He gets respect because he’s the purest voice for the Left. He says out loud what they have taught themselves not to say, and it’s just thrilling

     

    • #4
  5. I Walton Member
    I Walton
    @IWalton

    Good article.   The Scandinavian economies have freer economies than we do, moreover they are small enough and homogeneous enough to reverse bad policies.   Look what the Democrats are trying to do to Trump for reversing just a little.   If we go where the Democrats say they want to take us, it can’t end well, ever.

    • #5
  6. Kozak Member
    Kozak
    @Kozak

    James Lileks (View Comment):

    Bernie Sanders is a charmless, hectoring, covetous man whose economic ignorance is matched only by his callous disregard for the millions of victims of the regimes he has championed. In his mind top-hatted plutocrats are still clubbing orphans with diamond-tipped walking sticks as they alight from their carriages to pass to their mansions, while earnest, beaming, selfless proles in the USSR are working together to increase the five-year-plan’s cement quota. If he got elected and the stock market went down 50%, he’d see it as proof he was doing the right things.

    He gets respect because he’s the purest voice for the Left. He says out loud what they have taught themselves not to say, and it’s just thrilling.

     

    I really hope he is the nominee for the Democrats.   I respect the fact he doesn’t go in for the Maskirovka.

    Let’s have a real clear  contrast in visions for America.

     

    • #6
  7. Stad Coolidge
    Stad
    @Stad

    I’ve always heard Scandinavian socialism is a bad example because it really isn’t socialism at all.  The JP Morgan analysis pretty much says that.  In fact, it almost sounds like the US, but with much higher taxes . . .

    • #7
  8. Full Size Tabby Member
    Full Size Tabby
    @FullSizeTabby

    Although Sen. Sanders keeps using language that tries to link his proposals to Scandinavian policies, his actual policies are, and have always been, straight out of 1975 Soviet Union. 

    • #8
  9. Stad Coolidge
    Stad
    @Stad

    If Bernie wins the nomination, Trump should tell black voters, “Bernie wants to turn the US into Scandinavia – all white!”

    • #9
  10. Henry Castaigne Member
    Henry Castaigne
    @HenryCastaigne

    James Lileks (View Comment):

    Bernie Sanders is a charmless, hectoring, covetous man whose economic ignorance is matched only by his callous disregard for the millions of victims of the regimes he has championed. In his mind top-hatted plutocrats are still clubbing orphans with diamond-tipped walking sticks as they alight from their carriages to pass to their mansions, while earnest, beaming, selfless proles in the USSR are working together to increase the five-year-plan’s cement quota. If he got elected and the stock market went down 50%, he’d see it as proof he was doing the right things.

    He gets respect because he’s the purest voice for the Left. He says out loud what they have taught themselves not to say, and it’s just thrilling.

     

    I agree with everything but the charmless part. If he is so charmless, why are so many millennials, well, charmed by him?

    • #10
  11. Henry Castaigne Member
    Henry Castaigne
    @HenryCastaigne

    Stad (View Comment):

    I’ve always heard Scandinavian socialism is a bad example because it really isn’t socialism at all. The JP Morgan analysis pretty much says that. In fact, it almost sounds like the US, but with much higher taxes . . .

    They also have less regulation, a history of less corrupt governance that goes back hundreds of years and a population that is less prone to crime and welfare fraud than the American population. 

    Tino Sanandaji is a great writer about how Scandinavian culture can better cope with the welfare state. 

    https://www.youtube.com/watch?v=Txk-CZRFEoQ

    • #11
  12. Paul Stinchfield Member
    Paul Stinchfield
    @PaulStinchfield

    Full Size Tabby (View Comment):
    Although Sen. Sanders keeps using language that tries to link his proposals to Scandinavian policies, his actual policies are, and have always been, straight out of 1975 Soviet Union. 

    It is common practice for leftists to tell that sort of lie.

    • #12
  13. MISTER BITCOIN Inactive
    MISTER BITCOIN
    @MISTERBITCOIN

    Bernie is an idiot.

    Walter Williams said it best, Nordic socialism is a myth.

     

    • #13

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