Monday, September 13, 2010

The Nordic Model

The much admired economies and lifestyles of Scandinavia, as liberal economists and politicians often tell us, can teach much to the United States... but they often forget to mention the laissez-faire policies that drive the engine of their economies. For example....
  • Scandinavia has lower corporate tax rates than the US
  • Scandinavia has low-rate flat tax on capital income
  • some Scandinavian nations have privatized retirement systems
  • some Scandinavian nations have flat-rate income tax
The Nordic nations do not have the economic growth of the US, due to the large burden of their welfare states, but their citizens are provided with benefits that the citizens of the United States are not. Their public sector costs are over 48% GDP, as compared to under 37% in the US. For a mere 11% additional GDP they manage to provide health care and a bunch of other benefits to their citizens. To be fair to the US we must add the fact into the figures that if Scandinavia did not live under the military umbrella of the world's defender, the United States, their government costs would be much higher, so we do subsidize a portion of their economies. To learn more on this topic... the next paper I am reading is "What can the United States Learn from the Nordic Model?" Should be interesting.

Another interesting article:


The last paper I read was "Thinking Clearly about Economic Inequality", and was very interesting. I am still researching the effects of political policy and cultural changes on economic inequality, which Scandinavia has less of, but there are some interesting questions about how much it matters. I am more interested in learning what policies create the most wealth for the most people, which is kinda the same.. but not necessarily. While seeking economic equality for all, it is much easier to become equally poor rather than equally rich. For instance, does economic inequality matter if the policies that create wealth for the rich also create wealth for the poor, but unequal portions of it? I am interested in finding policies that make us all better off.


One more shortie, an interesting article from South Africa: Biblical Principles for Government. A look at why many of the world's governments, including our own, are structured the way they are, and the Biblical principles behind them.

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