How do hardline free marketeers explain the Nordic countries?

SpicyMcVoodoo · 10-27-2006, 04:58 PM

Science & Technology at Scientific American.com: The Social Welfare State, beyond Ideology -- Are higher taxes and strong social "safety nets" antagonistic to a prosperous market economy? The evidence is now in

http://www.weforum.org/pdf/Global_Co...2006/top50.pdf

People who still cling to communism are said to be crazy these days because, regardless of how good the theory sounded, we've seen what's become of communist countries. We have real life experiments like North Korea vs. South Korea...the USSR vs. the USA, etc.

And yet, when it comes to quasi socialism vs. very little socialism, we also have experiments. And to the objective observer, these experiments seem to show, over quite a long periods of time, that the quasi socialist model works very well. People have been predicting the fall of 'welfare states' like Sweden for decades and it doesn't happen. In fact, they just keep getting better.

Even in the face of real life experiments which show quasi socialistic countries are doing better than everyone else economically, some people still cling to a completely hardline libertarian view of economics.

How do you reconcile this? I realize that it's an attractive theory to think low taxes + free market = economic success, but don't these real life examples show it's just not that simple? Are hardline free marketeers the new communists insofar as they keep clinging to their ideas in the face of evidence the contrary?

WickedLou9 · 10-27-2006, 05:04 PM

I think that low taxes + free market = economic success.. but only for the few. The rest become more or less servile. It's a system that results in the biggest possible profit for a company but also results in the largest inequity in terms of social justice.

ballz2wallz · 10-27-2006, 05:05 PM

I hear too often that the Swedish economy is in trouble...

WickedLou9 · 10-27-2006, 05:07 PM

Originally Posted by ballz2wallz

I hear too often that the Swedish economy is in trouble...

Thier cost of living is REALLY high.

Publius · 10-27-2006, 05:23 PM

The Nordic countries have an extremely high cost of living and an extremely high taxation rate due to their economic policies. There is more parity, but all in all they aren't really better off than us. Given that their nations average close to a hundred times smaller than the U.S. population wise (Denmark: 5.5 million; Sweden: 9 million; Norway: 4.6 million; Iceland: 300k), I don't think it's a comparison that can really be made.

Socialism can work in smaller societies; the Native Americans and a lot of ancient tribes proved that. But the larger the society, the more of a failure the socialist model becomes.

SpicyMcVoodoo · 10-27-2006, 05:26 PM

Originally Posted by WickedLou9

Thier cost of living is REALLY high.

Stockholm, which I imagine is the most expensive city to live in in Sweden, ranks 36 on this global cost of living list, which is cheaper than some pretty low tax places like Dublin, and much cheaper than some uber capitalist places like Hong Kong.

Global/Worldwide Cost of Living Survey Rankings 2006, Cities, International, Europe, Asia, America, US, American, Americas, United States, Africa, Australia, USA, Asian, Canada, Expensive, Cheap, : Finfacts Ireland

Publius · 10-27-2006, 05:29 PM

Originally Posted by SpicyMcVoodoo

Stockholm, which I imagine is the most expensive city to live in in Sweden, ranks 36 on this global cost of living list, which is cheaper than some pretty low tax places like Dublin, and much cheaper than some uber capitalist places like Hong Kong.

Global/Worldwide Cost of Living Survey Rankings 2006, Cities, International, Europe, Asia, America, US, American, Americas, United States, Africa, Australia, USA, Asian, Canada, Expensive, Cheap, : Finfacts Ireland

The population of the entire Greater Stockholm area is 1.5 million ... Hong Kong has just shy of 7 million in about the same land area. That explains why moreso than the economic policies of the two places.

SpicyMcVoodoo · 10-27-2006, 05:29 PM

Originally Posted by Publius

The Nordic countries have an extremely high cost of living and an extremely high taxation rate due to their economic policies. There is more parity, but all in all they aren't really better off than us. Given that their nations average close to a hundred times smaller than the U.S. population wise (Denmark: 5.5 million; Sweden: 9 million; Norway: 4.6 million; Iceland: 300k), I don't think it's a comparison that can really be made.

Socialism can work in smaller societies; the Native Americans and a lot of ancient tribes proved that. But the larger the society, the more of a failure the socialist model becomes.

Have any large countries actually tried to implement the Nordic economic model?

Publius · 10-27-2006, 05:32 PM

Originally Posted by SpicyMcVoodoo

Have any large countries actually tried to implement the Nordic economic model?

I'm sure many have studied the possibility, but to my knowledge no. I imagine it's one of those things that even on paper becomes so obviously too expensive that they don't even attempt it.

SpicyMcVoodoo · 10-27-2006, 05:32 PM

Originally Posted by Publius

The population of the entire Greater Stockholm area is 1.5 million ... Hong Kong has just shy of 7 million in about the same land area. That explains why moreso than the economic policies of the two places.

And what about Dublin?

The population within the city (i.e. the administrative area controlled by Dublin City Council) was 505,739 at the census of 2006. Beyond this, at the same census the Dublin Region population was 1,186,159, whilst the Greater Dublin Area had a figure of 1,661,185.

SpicyMcVoodoo · 10-27-2006, 05:33 PM

Originally Posted by Publius

I'm sure many have studied the possibility, but to my knowledge no. I imagine it's one of those things that even on paper becomes so obviously too expensive that they don't even attempt it.

Or how about the more likely explanation? Politics did not allow for it.

Publius · 10-27-2006, 05:34 PM

Originally Posted by SpicyMcVoodoo

And what about Dublin?

Publius · 10-27-2006, 05:35 PM

Originally Posted by SpicyMcVoodoo

Or how about the more likely explanation? Politics did not allow for it.

I'm sure it's probably a mixture.

6SpeedTA95 · 10-27-2006, 05:36 PM

It's not a fair comparison.

Their countries are so small that in many cases they're able to specialize their economy into specific areas. Furthermore costs are outrageous as are taxes, so while percapita is higher, realistically they're not making anymore or living any better than we are.

SpicyMcVoodoo · 10-27-2006, 05:41 PM

Originally Posted by 6SpeedTA95

It's not a fair comparison.

Their countries are so small that in many cases they're able to specialize their economy into specific areas. Furthermore costs are outrageous as are taxes, so while percapita is higher, realistically they're not making anymore or living any better than we are.

Every global quality of life survey I've seen has the top slots filled with Nordic countries, e.g., http://www.economist.com/media/pdf/QUALITY_OF_LIFE.pdf

So it would appear they are living better than we are. Also, how do you reconcile these supposedly huge costs with the fact that many Nordic countries are cheaper to live in than some uber capitalist countries per the cost of living list I just posted?

lew · 10-27-2006, 05:42 PM

The Nordic countries were anarcho-capitalist centuries ago.

Phantom · 10-27-2006, 05:44 PM

Originally Posted by Publius

Socialism can work in smaller societies; the Native Americans and a lot of ancient tribes proved that. But the larger the society, the more of a failure the socialist model becomes.

that sums it up nicely

lew · 10-27-2006, 05:46 PM

Socialism usually works fine - as long as it's not pushed on by an authority or state. If all the people choose to subject themselves to socialism, it works great.

Publius · 10-27-2006, 05:46 PM

Originally Posted by SpicyMcVoodoo

Also, how do you reconcile these supposedly huge costs with the fact that many Nordic countries are cheaper to live in than some uber capitalist countries per the cost of living list I just posted?

I already answered this: it's primarily due to the population density. Do you really think NYC would cost so much to live in if it had the population density of, say, Omaha, Nebraska?

There are of course other reasons, but that is the primary one. Also, cost of living rarely if ever includes the tax burden of living in those places.

Quality of life surveys rarely include tax rates, as well. So while they may have a high quality of life in terms of services provided, they are still subjected to a rather massive tax burden that sucks up large chunks of their personal income.

lew · 10-27-2006, 05:47 PM

Originally Posted by WickedLou9

I think that low taxes + free market = economic success.. but only for the few. The rest become more or less servile. It's a system that results in the biggest possible profit for a company but also results in the largest inequity in terms of social justice.

How so?