Sweden: Truly a step ahead of America

since America seems hellbent on electing socialists, lets take a look at the only example often cited as any “success” using a mostly socialist based government-Sweden.  I pick them because they included some capitalist principles with socialism which is what America would most likely seek to do under Obama.

A very rough history lesson:

in 1932 the Swedish Social Democrat party took over power. Sweden, due to staying neutral in World War 2, was able to avoid any destruction to its infrastructure and major businesses.  they, like America after WW2, grew rapidly with its vast natural resources (especially wood and iron) and exportation of.   During this time of prosperity Sweden also grew its social welfare state to a high level with cradle to grave entitlements.  In 1950, Sweden actually reached 3rd in overall wealthiest nations in the world (behind USA and USSR) Then a generation passed….

As taxes mounted and government spending skyrocketed, beginning in the 1970’s, Sweden began to decline.  A new generation of workers, who had been exposed to policy that heavily taxed anything properous and gave handouts to those who didn’t work, decided that there was no reason to pursue any wealth creation opportunities.  so from the 70’s onward overall wealth declined, job creation stayed stagnant, prosperity levels fell, all the way to the point of nearly bankrupting the country in the 90s. 

 

 

All of these graphs come from this brilliant article: The Myth of the Scandinavian Model (read it if you want to know why Ireland has done so well)

so now we see Sweden, and most of the Scandinavian welfare-state countries with it, having fallen greatly in the worldwide prosperity rankings (GDP per capita).  Lets go even further:

From 1980-1999 The Swedish Research Institute of Trade (HUI) said it had compared official U.S. and Swedish statistics on household income, as well as gross domestic product, private consumption and retail spending per capita.  Heres what they found–

1. Using fixed prices and purchasing power parity adjusted data, the median household income in Sweden at the end of the 1990s was the equivalent of $26,800, compared with a median of $39,400 for U.S. households.

2. “Black people, who have the lowest income in the United States, now have a higher standard of living than an ordinary Swedish household,” the HUI economists said.

3. “If Sweden were a U.S. state, it would be the poorest, measured by household gross income before taxes” HUI’s president, Fredrik Bergstrom, and chief economist, Robert Gidehag, said.

4. Between 1980 and 1999, the gross income of Sweden’s poorest households increased by just over 6 percent, while the poorest in the United States enjoyed a three times higher increase, HUI said.

5. during the period 1998-1999, U.S. GDP per capita (prosperity index) was 40 percent higher than in Sweden, while U.S. private consumption and retail sales per capita exceeded Swedish levels by more than 80 percent.

http://www.timbro.se/bokhandel/pdf/9175665646.pdf (the report-download and read this. it absolutely should embarrass all Europeans)

Is this what we want? 

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Hope and Change for Sweden

http://www.washingtontimes.com/news/2007/jun/17/swedens-turn-from-socialism/

In 2006 even Sweden finally said enough of this socialist mediocrity.  in an absolute landmark election for that country, they elected conservative leadership.  Moderate Party leader Fredrik Reinfeldt took office–Sweden’s very own Ronald Reagan in to save the country from 35+ years of economic decline. 

Sweden is already quickly jolting ahead of America with some of the policies being implemented.  Partial privatization of social security, elimination of the death tax, elimination of property tax(!), elimination of the wealth tax (hrm sounds like something Obama would institute), reforming the unemployment payment system, and eliminating state participation in 6 major companies.  further plans call for reforming the country’s rediculous sick pay policy (which causes the Swedish workforce to be the “sickest in the world”), a reduction in maternity leave pay (which has led to women struggling to get hired in a lot of industries) and a renewed relationship with the United States.  foreign investment has began flowing back in, jobs are getting created, and wealth is growing again. 

In Cutting Taxes, Liberal Sweden takes a right turn

Hot Damn!  I may be finding a new home very soon…..