browsing deer
Silver Member
Sweden is free trade, school vouchers to go to any school, privatized national pensions, no inheritance tax, low corporate taxes
Bernie's Right—America Should Be More Like Sweden
Bernie Sanders thinks the U.S. should look to Sweden and other Scandinavian countries to "learn what they have accomplished for their working people." The Vermont senator has said so repeatedly throughout his campaign for the Democratic presidential nomination, prompting GOP rival Marco Rubio to say, "I think Bernie Sanders is a good candidate for president—of Sweden."
As a native of Sweden, I must admit this makes me Feel the Bern a bit. Sanders is right: America would benefit hugely from modeling her economic and social policies after her Scandinavian sisters. But Sanders should be careful what he wishes for. When he asks for "trade policies that work for the working families of our nation and not just the CEOs of large, multi-national corporations," Social Democrats in Sweden would take this to mean tradeliberalization—which would have the benefit of exposing monopolist fat cats to competition—not the protectionism that Sanders favors.
In fact, when President Barack Obama visited Sweden in 2013, the three big Swedish trade unions sent him a letter requesting a meeting. Their agenda: a discussion of "how to promote free trade." The chairman of the largest Social Democratic trade union scolded the American president for his insufficient commitment to the free flow of goods.
This reality will not endear my home country to American socialists, but it's better to be hated for the right reasons than to be loved for the wrong ones, as the saying goes. Being more like modern Sweden actually means deregulation, free trade, a national school voucher system, partially privatized pensions, no property tax, no inheritance tax, and much lower corporate taxes. Sorry to burst your bubble, Bernie.
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In other words, there is no secret about Scandinavia's success, no mystery to be explained. These countries have performed just like any free market economist would have expected. They outgrew other industrialized countries when they had freer markets, and stagnated when they experimented with socialism. Now that they have started reforming their economies again, they are again performing better. "Sweden is the rock star of the recovery," The Washington Post proclaimed in 2011.
The legacy of Scandinavia's third way—its still-high public spending and high taxes, at least compared to the U.S.—has dwindled to fairly normal European levels. The governments provide the citizens with health care, child care, free colleges, and subsidized parental and medical leave. We Scandinavians have our quarrels with these systems and how they function, but at least they have not ruined our societies; indicators of living standards and health are impressive.
Why isn't the system more abused? Why are they not more of a drag on growth?
One reason is that we compensate for them with a more open economy than others. In the summary Fraser Institute rankings, Sweden and Denmark are more economically free than the United States when it comes to legal structure and property rights, sound money, free trade, business regulation, and credit market regulations. We don't have the multitude of occupational licensing laws that block competition in the United States.
Tax the Poor
We also pay for the welfare state in a fairly brutal way, but one that doesn't hurt production as much: by squeezing the poor and the middle class. Unlike the rich, poor and middle-class people don't flee or dodge when they're taxed aggressively.
The Social Democrats knew all along that they couldn't fund such a generous government by taking from the rich and the businesses—there are too few of them, and the economy depends on them too much. So Sweden and Denmark take in lots of revenue via highly regressive value-added taxes at a normal rate of 25 percent of sales—the only tax where the rich and poor pay exactly the same amount in kronor. On the other hand, the corporate tax is just 22 and 23.5 percent respectively, compared to the U.S. rate of 35 percent.
Bernie's Right—America Should Be More Like Sweden
Bernie Sanders thinks the U.S. should look to Sweden and other Scandinavian countries to "learn what they have accomplished for their working people." The Vermont senator has said so repeatedly throughout his campaign for the Democratic presidential nomination, prompting GOP rival Marco Rubio to say, "I think Bernie Sanders is a good candidate for president—of Sweden."
As a native of Sweden, I must admit this makes me Feel the Bern a bit. Sanders is right: America would benefit hugely from modeling her economic and social policies after her Scandinavian sisters. But Sanders should be careful what he wishes for. When he asks for "trade policies that work for the working families of our nation and not just the CEOs of large, multi-national corporations," Social Democrats in Sweden would take this to mean tradeliberalization—which would have the benefit of exposing monopolist fat cats to competition—not the protectionism that Sanders favors.
In fact, when President Barack Obama visited Sweden in 2013, the three big Swedish trade unions sent him a letter requesting a meeting. Their agenda: a discussion of "how to promote free trade." The chairman of the largest Social Democratic trade union scolded the American president for his insufficient commitment to the free flow of goods.
This reality will not endear my home country to American socialists, but it's better to be hated for the right reasons than to be loved for the wrong ones, as the saying goes. Being more like modern Sweden actually means deregulation, free trade, a national school voucher system, partially privatized pensions, no property tax, no inheritance tax, and much lower corporate taxes. Sorry to burst your bubble, Bernie.
........
In other words, there is no secret about Scandinavia's success, no mystery to be explained. These countries have performed just like any free market economist would have expected. They outgrew other industrialized countries when they had freer markets, and stagnated when they experimented with socialism. Now that they have started reforming their economies again, they are again performing better. "Sweden is the rock star of the recovery," The Washington Post proclaimed in 2011.
The legacy of Scandinavia's third way—its still-high public spending and high taxes, at least compared to the U.S.—has dwindled to fairly normal European levels. The governments provide the citizens with health care, child care, free colleges, and subsidized parental and medical leave. We Scandinavians have our quarrels with these systems and how they function, but at least they have not ruined our societies; indicators of living standards and health are impressive.
Why isn't the system more abused? Why are they not more of a drag on growth?
One reason is that we compensate for them with a more open economy than others. In the summary Fraser Institute rankings, Sweden and Denmark are more economically free than the United States when it comes to legal structure and property rights, sound money, free trade, business regulation, and credit market regulations. We don't have the multitude of occupational licensing laws that block competition in the United States.
Tax the Poor
We also pay for the welfare state in a fairly brutal way, but one that doesn't hurt production as much: by squeezing the poor and the middle class. Unlike the rich, poor and middle-class people don't flee or dodge when they're taxed aggressively.
The Social Democrats knew all along that they couldn't fund such a generous government by taking from the rich and the businesses—there are too few of them, and the economy depends on them too much. So Sweden and Denmark take in lots of revenue via highly regressive value-added taxes at a normal rate of 25 percent of sales—the only tax where the rich and poor pay exactly the same amount in kronor. On the other hand, the corporate tax is just 22 and 23.5 percent respectively, compared to the U.S. rate of 35 percent.
