The Swedes Try: "The Nordic Option"

When I was very young, I remember writing a class paper examining Swedish socialism, which was supposed to provide the "model society" for how to do socialism right. I presented a more skeptical view, pointing to high unemployment, runaway government debt, and evidence of economic stagnation. In more recent decades, Sweden has suffered from a "brain drain" as it well-educated youth leave for Britain or America where their education has more economic value than it is allowed to have back home.

But in recent years, Sweden—like France—has been toying with "le modele Anglo-Saxon," as the French put it: the British and American example of how lower taxes and fewer regulations lead to a more dynamic, faster growing, wealthier economy. The article below describes the first, halting steps—under the rubric of "combining" American individualism with Swedish collectivism—to dilute Sweden's welfare-state ethic with the concept that it should be "profitable to work."

"The Nordic Option," Roger Cohen, New York Times, September 17 Think Sweden and what comes to mind is probably not a youthful finance minister, with his long dark hair in a ponytail and a gold ring through his left ear, explaining that his ambition is to make it "more profitable to work" than to sit around on welfare.

But Anders Borg, 39, poster boy of the "New Moderates" who have put the long-governing Social Democrats out of office, does just that….

The ponytailed finance minister—a world first?—is just one sign that something funky is up in the Swedish woods. A government that includes the country's first black, avowedly gay and bisexual ministers (that's three distinct people) has set about a radical reform of the generous welfare state that defined the Swedish condition.

In doing so, it has adopted a few core principles. It should be more profitable to work than not to work. Welfare should mean caring for people who cannot care for themselves. Unemployment insurance should be adjustment insurance rather than an open-ended sinecure. Employers should be encouraged to hire through lower taxes.

Hardly rocket science, you might say, but all of this has proved radical enough to make "systemskifte," or "system shift," the buzzword in Sweden….

"My idea," Borg says, "is to combine the entrepreneurial spirit of America with the welfare of Sweden. That's my ideal world: the creative impulse and restructured welfare."