fled Sweden.
Posted on 03/21/2009 9:55:17 AM PDT by trueamerica
The Swedish financial chief known as "Mr Fix It" has been summoned to Washington to advise on how Sweden's model might avert a global banking meltdown.
US President Barack Obama cites Sweden as a possible model of how best to tackle failing banks. Mr Lundgren, who was fiscal and financial affairs minister at the time of the last crisis, yesterday outlined the Swedish solution to the Congressional Oversight Panel, which supervises the US administration's troubled asset relief programme.
(Excerpt) Read more at telegraph.co.uk ...
Right, we need advice from one of the most socialist states on the planet.
That is the plan...
When is it going to become clear that Sgt. Schultz can care less if there is a recovery or not as long as he gets passed his programs, many in the so-called “stimulus” bill that crate futher dependency on government and cost to the taxpayers? He’s always been a dedicated and discipilined Marxist on a mission. It’s the fulfillment of his black liberation theological belief system.
That this is “THE PLAN” was telegraphed to us a couple of weeks ago by ZERO.
First he said they would nationalize, the market tanked the last week of Feb and first week of Mar, then they said nationalization was not necessary, Citi reported profit and the market went up.
This is “THE PLAN” and the market will....I haven’t got a clue what it will do.
fled Sweden.
I thought Obama was calling in Dolph Lundgren.
What’s the matter? Did Obama give up on Little Timmy already? Nothing like asking someone from the world’s most socialist country for help. It is a good thing that Hitler is dead. Otherwise, he would be asking him for help in how to pacify the masses.
- If you by Socialism mean a high level of taxation as expressed by its percentage of GDP, then Sweden is indeed very Socialist.
On the other hand, using that definition, North Korea and Cuba appear as very unsocialist parts of the Earth.
Sweden has lower corporate taxes than the US and somewhat lower income taxes, has more successful multinationals per capita than more or less any other country, has been ranked among the most economically free nations by various organizations and furthermore has a government that recently has weakened the country's trade unions (which in any case are far more aware and responsible than their French, American and Italian counterparts), lowered taxes and sold off government owned businesses (like V&S with brands such as Absolut).
According to the IMF, Sweden has a higher GDP per capita measured in nominal GDP than most other countries including the US (without having oil like Norway and USA does) and is often viewed of as one of the most technologically advanced, innovative and investment friendly countries by people with genuine insight into such areas.
The kind of Socialism Sweden was infamous for during the 1970s and -80s did NOT work. That's why we currently are steering away from it and will continue to.
From 1870-1970, Sweden enjoyed moderate public expenses as well as the highest GDP growth rate of all countries.
During 1970-1990, Sweden expanded its public sector radically while annual GDP growth rates were among the lowest of all OECD countries.
Since the reforms in the early 1990s, Sweden's economy has reconquered its position as one of the the most impressive ones in the developed part of the world and the standard of living is perhaps the world's highest (Norwegian and Danish wages are higher, but consumption is in many ways discouraged in these countries and especially in Denmark, real estate prizes are ridiculously inflated).
Perhaps every true friend of economic growth and prosperity in the US ought to listen to people like Lundgren.
There is a reason why the American financial sector is in a severe crisis and the Swedish financial sector is not.
There is a reason why US has a national deficit that soon will become 100 times larger than Sweden's, despite America having only 31 times as large a population.
The reason to this difference is that although Sweden has made severe mistakes in the past, we've also managed to restore Capitalism in our country.
Last September and October there were a few comments on some threads here on FR about how the Swedish government fixed their banking system with the right kind of limited support.
My first reaction when I saw this thread title was that if only our government would follow the general methods used in Sweden in the early 1990’s we might see some improvement.
I expect the advice will be good, but I have seriously doubts that anyone in the current administration will seriously heed the advice.
- I too have my doubts and despite common traits like being technologically advanced nations that in many ways are founded on Protestant work ethics (not wishing to call Catholics, Jews and other religious groups lazy), there apparently are many differences between Sweden and USA too.
However, I've learned that a great deal of Americans are very engaged in all sorts of economic matters and also have a positive, optimistic attitude to the vast and undeniable possibilities of the American economy.
What worked well in Sweden around 20 years ago was that a large degree of all politicians, journalists, experts of economy, corporate managers and even leading Unionists arrived at the conclusion that Sweden had lost a a great deal of the advantages and competitiveness we boasted before the 1970’s and that drastic changes in favor of Capitalism had to be made.
If you can convince a nation that an ever growing deficit will become disastrous for every body's economic situation sooner or later and you have a government that is able to find ways of stimulating economic initiative while simultaneously cutting government expenses, then much is won.
One might argue that Sweden is more homogeneous and smaller than the US and therefore easier to govern, but there are also advantages with being a large, highly diversified economy. Besides this, there still is much of a “We the people”-spirit, much of a “Can do”-culture and an ability of team work in America of today as I view things.
Recessions come and go, but you also got to deal with them. Perhaps Obama will fail, but I refuse to believe USA will go on failing forever.
Regards.
>> Recessions come and go, but you also got to deal with them. Perhaps Obama will fail, but I refuse to believe USA will go on failing forever. <<
Thanks very much for your “common sense” analysis!
Morover, your description of Sweden’s captitalist revival makes me proud again that my genes are 25% Swedish!
Poll: Swedes in favour of Volvo nationalization
Socialized Medicine in Sweden: Same Bad Medicine
Sweden has lower corporate taxes than the US and somewhat lower income taxes
Total government expenditures, including consumption and transfer payments, are very high. In the most recent year, government spending equaled 55.6 percent of GDP. Spending has been reduced from over 60 percent of GDP in the 1990s but is still at one of the highest rates among OECD member countries. Public debt has fallen below 40 percent of GDP.
I'm not saying the general level of taxation is higher in the US compared to Sweden. It's the other way around.
The VAT, Value added tax (in Swedish; moms) is the reason to this. No disagreement there.
We also agree Sweden needs to reduce government spending and overall government involvement in everyday life, especially in terms of running businesses. This is one of the main ambitions of the Conservative party (Moderaterna) which today dominates our government.
Fiscal freedom can of course be defined in many ways.
Most people who have a wide experience of running a business in Sweden as well as abroad usually say the Swedish fiscal system is very generous BUT only as long as you don't want to use the money in your company for private consumption. On the other hand, there are numerous way to elude the system.
In the end, the government seems to get its fair share, which of course is necessary in order to provide things like infrastructure, law enforcement etc as well as the companies, their owners and employees.
It's very difficult to argue with the fact that Sweden is a well run society today unlike the Socialist mess it was 20 years ago.
But why stop there?
We Swedes have to do away with even more of our unnecessary, costly and harmful bureaucracy than we already have done and remain focused on what is good for our exports. That's the only way a small, open economy like ours can stay prosperous and continue reducing its national debts while lowering taxes at the same time.
So far Obama’s (explicit) agenda has been very different from what Sweden did 20 years ago and has continued doing since then.
Obama wishes to INCREASE public spending and leave it to future Americans to take care of the deficit.
That's not what we'd call looking after your own house in my country and I sincerely hope there are enough of aware, intelligent and patriotic Americans in order to prevent USA from trying to imitate the mistakes Sweden and the other Nordic countries (Scandinavia + Finland) made in the 1970s and 1980’s.
Today, USA in general has more of economic freedom than Sweden, but I fear that could change. As USA is much more important than Sweden from a global economic perspective, such a development is bad news for everyone on this planet.
Check my link.
In the end, the government seems to get its fair share, which of course is necessary in order to provide things like infrastructure, law enforcement etc as well as the companies, their owners and employees
Of course, it depends on what the meaning of "fair" is. Total government expenditures, including consumption and transfer payments, are very high in Sweden. In the most recent year, government spending equaled 55.6 percent of GDP. Spending has been reduced from over 60 percent of GDP in the 1990s but is still at one of the highest rates among OECD member countries. By comparison, US government spending is 36.7 percent of GDP, which will increase with the stimulus package. I agree, we are going in the wrong direction.
That's not what we'd call looking after your own house in my country and I sincerely hope there are enough of aware, intelligent and patriotic Americans in order to prevent USA from trying to imitate the mistakes Sweden and the other Nordic countries (Scandinavia + Finland) made in the 1970s and 1980’s.
And [Sweden and the Nordic countries] are still making. I don't want the US to look like the Nordic countries and Finland in terms of our economy. I say that having lived two years in Finland. Materially, people are fairly well off, but socialism [and communism] destroy individual liberties and initiative. The state has too much control over the individual.
Today, USA in general has more of economic freedom than Sweden, but I fear that could change. As USA is much more important than Sweden from a global economic perspective, such a development is bad news for everyone on this planet.
Sweden is a nation of 9 million people compared to the US with 305 million, i.e., we are 14 times larger. Our economy is much more complex and dwarfs Sweden's, i.e., a $350 billion GDP compared to a $12 trillion GDP. And your population is much more homogeneous. Fllowing the Swedish model is not only undesireable, it is impossible.
If the plan is half as attractive as Tiger Wood's Swedish Model, I'm all in favor.
- To begin with, I totally agree.
But what does the “Swedish Model” actually mean?
There are two Swedish models that, today, receive some degree of attention on the international level;
A) First we have the outdated, classical, “Third Way” Swedish Model which rightfully is associated with things like the Nanny State, perverse income taxes and Socialism.
Capitalism was allowed in this Utopia, however, just like every other aspect of society, the idea was that Capitalism had to be put under “democratic control” - which in the end would have lead to sheer Communism sooner or later.
In America, a lot of Conservatives seem to think little has changed since the Cold War era in Sweden (not having you personally in mind though), while many Liberals in America talk like they believe Sweden to be a smorgåsbord of free government goodies that exists thanks to a superior societal concept that could be implemented anywhere.
B) Then there's the “New Swedish Model” which has gained much more attention in for instance Germany than the US (for natural reasons), which could be described as a society which is founded on;
- A strong, centralized, government (although not as big as the in the case of the classical Swedish Model)
- Traditional egalitarian values (which I'd say dates back to the Viking ages sooner than the heyday of Socialism), something that appeal to Europeans to a larger extent than Americans, meaning among other things that everyone should be guaranteed high quality, low cost health care, education, child care etc independent of income, although private schools, clinics and so on are welcome as an alternative (as long as they follow government guidelines and standards)
- Financial discipline and rigorous measures being taken to control the (private) financial sector, as well as measures aiming at reducing national debt
- Encouragement of entrepreneurship and policies designed to achieve a globally oriented, healthy business climate that, too a wide extent, operates in a free manner independent of government involvement
- Heavy national investments in R&D, infrastructure and high quality education
I believe none of these Swedish Models could successfully be adopted by either USA or Germany. There are many reasons to this, like that of Germany being a very young country consisting of very old and very tradition bound regions and cities and furthermore Germany being a nation that despite giant multinationals like Volkswagen is much more dependent on middle sized companies than Sweden.
However, Sweden and USA both are dependent on a healthy (national) financial sector and naturally no nation benefits from having to deal with the threat of an uncontrollable deficit. USA can not copy what Sweden did in the wake of the last decade, but I believe other countries could learn from COMPARING their situation of today to that of Sweden in the early 1990’s. I'd also say Lundgren is competent enough to understand the unique features of the present American situation, even though he definitely can't play the role of “Mr Fix It” in that context.
When it comes to income taxes, I should have pointed out that when comparing Swedish to American income taxes I was referring to federal income taxes COMBINED with state income taxes (I'm aware some states impose no such taxes).
As I willingly admit I know far less than I would like to regarding these matters, please let me hear your reaction to this estimation (is this an exaggerated account of how much taxes an average American actually pays or how do you view it):
Greetings from Thule!
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