If Sweden was a U.S. state, how rich would it be? (HINT: Not Very)

If Sweden was a U.S. state, how rich would it be?

Two Swedish economists recently published a study that asks how European countries would fare if suddenly admitted into the American union. The results? If the UK, France, or Italy became U.S. states, they would rank as the fifth poorest of the fifty, ahead only of Arkansas, Montana, West Virginia, and Mississippi. The richest EU country—Ireland—would be the 13th poorest. Sweden would be the 6th poorest. In fact, the study found that 40% of all Swedish households would classify as low-income in the U.S.

This means that poorer U.S. states enjoy affluence comparable to that of richer European states—Denmark is equivalent to Kentucky—whether measured in terms of home ownership, or number of microwaves and cars possessed. “Material prosperity,” the authors write of the U.S., “is high and not associated with the material standard of living which many people in Europe probably associate with poverty. Good economic development, in other words, results in even poor people being relatively well off.”

By the 1880s, the U.S. had become the world’s richest nation (measured in per capita GDP). In the 1990s, U.S. growth was twice that of Europe’s, and three times that of Japan’s. The U.S. per capita income is now 55% higher than the EU-15 average, and 50% higher than Japan’s.

Here’s the not-so-secret recipe for achieving European-style stagnation and decline. First, combine high unemployment and aging populations to ensure that welfare costs far exceed worker contributions. Then, stuff with generous entitlements, massive tax burdens, rigid labor markets, and regulation-mad bureaucracies. For flavor, add dashes of socialism and right-wing paternalism. Bake. (For additional recipe ideas, consult Joy of Administrating by Ted Kennedy, or English departments everywhere.)

Joey Tartakovsky is assistant editor of the Claremont Review of Books.

(Here's the study's preface - the entire document is 49 pages)

PREFACE
IF THE EU WERE A PART of the United States of America, would it belong to the richest
or the poorest group of states?
At the beginning of the 1990s, there was no need to ask. Europe’s economic future was
a subject of growing optimism. Productivity growth had for some decades been higher
than in other countries of similar standing, and that growth was now going to be hugely
accelerated by the elimination of trade barriers and the closer economic integration resulting
from the Single Market. The EU as an institution was – and was undoubtedly seen as
– a vehicle for growth and economic liberalisation. In other words, the EU was able to do
what politicians in several member countries had wished for but had failed to achieve: to
increase economic openness, to strengthen the process of competition, and harness the
political process behind a liberal reform agenda.
Today, the perspectives on the EU, and the outlook on its future, are radically different.
Economic growth during the 1990s never became what many had wished for. Some
countries performed reasonably well, most notably Ireland, but on the whole the EU
was lagging far behind other countries during the whole decade. Productivity growth
decreased and by mid-decade the EU was running behind the US in this respect. The
process of convergence in productivity, a much talked-about process since the 1970s,
had once again become a process of divergence.
The role, and status, of the EU in the economic reform process has also changed. Instead
of a clear focus on economic reforms and growth, the EU (the Commission as well as the
Council) has concentrated its ambitions on other political objectives. Hence, the EU no
longer is – or is seen as – the great economic liberator of Europe. It is generally not
performing as a vehicle for reforms, nor as leverage for policies that are needed but
impossible to accomplish in the national political arenas.
Is it possible to break the spell of economic stagnation in Europe? Yes, undoubtedly.
But, alas, it seems highly improbable. The member countries have agreed on a relatively
far-reaching reform agenda in the Lisbon accord (yes, in the modern European context it
is far-reaching). But the agenda lacks impetus. Not to say a true awareness of the need
of reforms. Worse still, many European politicians and opinion-formers seem totally
unaware of the lagging performance of the EU economies and that a few percentage
units lower growth will affect their welfare in comparison with other economies.
Such is the background to this study on the differences in growth and welfare between
Europe and the US. Too many politicians, policy-makers, and voters are continuing their
long vacation from reality. On the one hand, they accept, or in some cases even prefer, a
substantially lower growth than in the US. On the other hand, they still want us to enjoy
the same luxuries and be able to afford the same welfare as Americans can. Needless to
say, that is not possible. But the real political problem is that lower welfare standards –
as with inequality in general – are a relative measure for most people. They are always
viewed by comparison with others, and rarely in absolute terms. People would rather
weep in the backseat of a new Mercedes than in the backseat of a second-hand
Volkswagen.
This study is based on a widely acclaimed and thought-provoking book – Sweden versus
the US – that was published earlier this year in Swedish by the same authors – Dr. Fredrik
Bergström, President of The Swedish Research Institute of Trade, and Mr. Robert
Gidehag, formerly the Chief Economist of the same institute, and now President of the
Swedish Taxpayers’ Association. The study presents important perspectives on European
growth and welfare. Its highlight is the benchmark of EU member states and regions to
US states. The disturbing result of that benchmark should put it at the top of the agenda
for Europe’s future.
Fredrik Erixon
Chief Economist, Timbro

Monday, November 01, 2004 - 12:00 AM |

Swedish students experience Utah life

Elisabeth Nardi DAILY HERALD

Thousands of miles away from her Swedish homeland, 17-year-old Lena Lidmark is positive she could never live in America, and especially not in Utah.

She has enjoyed spending the last two weeks with 22 of her classmates in the Beehive State, but it could never be home for two reasons.

"It's too religious, and it's too Republican," she said.

The 23 teenage Swedish students have been in Orem for the past two weeks learning about America and American teenagers. Each is staying with a family where there is at least one teen who is around the Swedish student's age, attending school at Orem High School on the same class schedule as their American counterparts.

In preparation for the visit, some of the Swedish and American teens have been
e-mailing each other for six months and know one another quite well.

During the extended field trip, the Swedish students have experienced Costco and church for the first time, seen Las Vegas and attended a Halloween dance at the school.

The field trip is under the direction of Michael Cross, instructor of psychology and
international relations at the International
College of Stockholm, a high school that has been bringing students to the United States for six years.

Cross, who was born in America and has taught in both countries, said each time he brings Swedish students to America he is amazed at the myths and stereotypes the Swedish teens bring with them.

"They think all the Americans are fat," he said. "Their image is that Americans are overweight, then they show up and start looking around, and they realize it's really not that much different than Europe."

Utahns dispelled many of the stereotypes, but not all of them. Emma Wahlborg, 17, is living with a family who has six children -- very different from her home where she is an only child. But the biggest difference is how much religion is a part of the lives of family members. Wahlborg said she never goes to church.

Morning prayer

"The biggest difference is probably praying in the morning," she said. "They sit around and read from the Book of Mormon for a half hour every morning -- but I think it's quite nice."

Wahlborg is not the only Swedish student who does not attend church. Lidmark said she is an atheist, and 17-year-old Ylva Sandberg says she believes in God but rarely goes to church.

"I don't go to Swedish church because you will actually fall asleep," she said. "The only people that go there are 80 or 90 years old."

In fact, Cross said, Sweden is often ranked as the country with the lowest attendance in church or religious beliefs in the world.

"Even in Oregon they would feel it's highly religious compared to Sweden," he said.

The Orem High School teens don't mind that their Scandinavian friends aren't religious.

Eric Smith, 16, said it doesn't bother him at all.

"I don't think it's weird," he said. "I have lived in other states where there are very few Mormons or LDS people around. Personally I go to church, but everyone is entitled to what they believe or don't believe. They are entitled to do what they want to do."

Different lives

The Swedish students also see big differences in the way American teens in Utah live -- everything from how late they stay out to the food served at school.

In Sweden, the students eat pizza once a year for school lunch, but 17-year-old Anders Axberg said he was surprised to see kids could get pizza every day at Orem High School.

What Axberg said he really misses is beer. In his country the legal drinking age is 18, but many underage people buy and drink wine or beer as young as 15, he said.

"Nobody drinks here -- not even the adults," he said.

As for the food, Wahlborg said there was too much sugar in what Americans eat, and not enough salads.

Other differences included the amount of freedom Swedish students have. Sandberg said she would be able to stay out until 3 a.m. without her parents worrying, and in Utah there are curfews.

In general all the teenagers said they felt Utah parents seemed more strict, but Jessica Simpson, a 16-year-old Orem High student and Wahlborg's host, seemed to think things wouldn't be as strict outside of Utah.

"It's different in Utah. Everyone thinks the same things. I don't think it would be so bad in other states," Simpson said.

Friendlier folks

The Swedish students also thought school was easier in America. Wahlborg said she was doing experiments in Orem's science classes she had done in her classes two years ago.

But there were positive differences, too.

Swedish students liked how nice everyone was in America. Sandberg and Lidmark seemed surprised people would hold doors open for one another in Utah.

"People are friendlier here," Sandberg said. "In Sweden you can't look at someone on the subway. Here you can say hi to a perfect stranger in the streets, you can't do that in Sweden because they look at you like you are crazy."

There are similarities between the Americans and the Swedes. All the teens seemed to agree no matter what country they live in, teenagers are
always in a hurry to grow up.

For the Swedish students, one way that manifests itself is keeping up with current events -- especially those that deal with America.

Presidential politics

Before the class embarked on its adventure, the students learned about the culture and politics of America, including learning about the two presidential candidates. And the students are not shy about voicing their opinion on who should win the election.

"I haven't got anything against Bush; I don't hate him in any way," Wahlborg said. "But I do feel a country like America which is supposed to represent freedom, and with people who get so much knowledge, they should have a more democratic government."

Most of the students -- like most Swedes -- are socialists, Cross said. He was not
surprised that they would be against a conservative president.

"I kind of hate Bush," Lidmark said. "Everything he does reflects on us, every (American) election has a reaction in Sweden too because he's so powerful -- both America and Bush. We probably should be voting in American elections."

Some of Lidmark's feelings for Bush stem from the war in Iraq.

"I think it's good Sadam Hussein is gone, but if you look at a place like Rwanda a lot of terrible things happen there and the U.S. doesn't do anything about that," she said.

Not all of the students agree with Lidmark.

Axberg believes the war in Iraq is a good thing and has helped the rest of the world be safer.

"Terrorists can only be stopped one way," he said. "If Saddam was still in power it could hurt more people."

The war and political climate is an issue for the Orem students as well but they seemed to agree with Axberg's view more.

"Saddam needed to be gotten rid of," said 16-year-old Alex Blomquist -- Lidmark is staying with her. "Even if there weren't weapons, there still was that threat. The U.S. can't control everything."

Sex, marriage and homosexuality

On issues of sex before marriage most of the Swedish students seemed to believe it was OK to have sex and have children before being married.

Lidmark said she never plans on getting married because she doesn't believe in it, and Wahlborg said before marrying someone she would have to live with them first. But Axberg said he did believe two people should be married before having children.

As for homosexuality, Lidmark, Sandberg and Wahlborg all agreed they didn't care what people did in their personal lives.

Cross said the field trip was successful in helping teach the Swedish and the Orem students about each other's worlds. But some of Swedish students' stereotypes were more or less supported by their visit.

For example, Lidmark still
believes most Americans get their information from Fox News, and an Orem High School football game is a lot like the ones she sees in the movies.

"The football game, with the cheerleaders and everything -- it's just so weird," she said.

Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.