Sweden's March Toward Capitalism: Economist Andreas Bergh on the "Capitalist Welfare State"

In The Capitalist Welfare State, Lund University economist Andreas Bergh explains how Sweden has managed to increase economic productivity despite its large public sector.

Bergh says that despite popular mythology, Sweden is not a socialist success story but instead owes its economic growth to the lowered tax rates and deregulation of the early 1990s, which allowed innovation and investment to flourish. Bergh also discusses how Sweden's national voucher program revitalized the country's educational system and warns that Americans who are hoping to emulate Swedish success by growing the public sector are learning the wrong lessons from Sweden.  

Produced by Ted Balaker and Daniel B. Klein; filmed by Jonathan Liberman and Henrik Devell; edited by Zach Weissmueller; with special thanks to Niclas Berggren, Martin Borgs, Nils Karlson, and the Ratio Institute .

Approximately 10 minutes long.

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Comments

[TP]

Sweden owes its economic growth to IKEA.

[Kolohe]

and ABBA

[Draco]

This one's for you MNG. I'll bet it hurts to be smacked down like this by your host, Reason.com.

[Warty]

The Ratio Institute? How irrational.

[Marc]

The Ratio Institute was founded to promote the use of ratios in modern discourse through a combination of education and intimidation.

[SxCx]

Please don't call it a march. The thought of a country marching together reminds me less of capitalism and more of the other thing.

[Ebeneezer Scrooge]

I agree. I couldn't even stomach marching band in high school. So how about:

The Great Stampede of the Mindless Thundering Herd

Their Massive Whimsical Predilection, Leading to Eruptions of Spontaneous No-Mind Order

We Made More Money When We Were Vikings

[AT]

I need that book.

[heller]

OH MNG, COME OUT COME OUT WHEREVER YOU ARE!

[Isaac]

I love getting in to a conversation with some European wanna-be socialist about education and bringing up Sweden's voucher system. That usually gets a fun response.

[Xeones]

The thought of a country marching together reminds me less of capitalism and more of the other thing.

You've obviously not gotten with the talking points, SxCx. This is Obama's America -- capitalism and the other thing are the same! Rahm and Barney will be along presently with the memo, and you may need to be... disciplined.

I love getting in to a conversation with some European wanna-be socialist about education and bringing up Sweden's voucher system.

There's also the bit about how 2/3 of Sweden's roads are privately owned. Leftists love that one.

[svenson]

oh really? Usually only tiny roads to ten or so houses are private over here. Possibly its true when it comes to the actual number of roads but if youd count kms or persons on the road it will probably be 99/100 public. Private roads are also usually free to travel on.. Or only for locals.

[P Brooks]

This is Obama's America -- capitalism and the other thing are the same!/i>

In that case, when do we start hanging politicians from lampposts by their heels?

[P Brooks]

Stupid keyboard.

[Chad]

*sob* They're going to ruin everything! Stupid Swedes!

[Isaac Bartram]

The Swedes actually just learned a lesson that Bill Clinton and the DLC learned and tried to put into practice. You can't have an extensive welfare state without a wealthy and vigorous private sector producing enough surplus income to fund it.

Actually, Jimmy Carter learned it earlier but thanks to the Democratic leadership in Congress all his attempts pretty much failed. Although most of Carter's ideas were too fatally flawed with do-goodism.

[Isaac Bartram]

Also, IIANM Sweden has never been socialist in the "expropriation of the means of production" sense.

While they might be heavily taxed, retail, food, banking, construction, heavy industry and resource extraction are still in private hands.

And even though the government is the principal payer in the healthcare sector, I believe most Swedish doctors are still private practicioners. Anyone who knows better can correct me as required.

[pat_mawiener]

Interesting justification for wealth confiscation. "Sure the government takes your money in taxes, but they give it back to you in your old age, as you need it."
Gee, thanks Swede, for your wise benevolence. Now, where is my firearm?

[Isaac Bartram]

Well, it's a justification for wealth confiscation that is very widely accepted as valid.

And, actually, Sweden has quite a robust hunting and shooting tradition. It's laws are certainly stricter than most states in the US, but it is one of the European countries that gun control advocates consider too lenient.

[pat_mawiener]

You're right, of course. It's an almost universal justification for wealth confiscation. But, I wasn't thinking of a hunting and shooting tradition when the thought of a firearm came to me.

[MrGuy]

Since when did taxes over 60% become something to emulate?

[EVL29]

"You could increase your taxes to Sweden's level but you will be spending it on the American public sector. I would not advise that.

No shit Sven.

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[rolex]

that's good?man

[Bram]

I found it interesting that the Swedish government is relatively efficient and 80%+ of taxes go back to the individual taxpayers. That will never happen in the U.S.

Our federal and state governments are massively bloated and inefficient. We get pennies on our tax-dollars and assume programs like Social Security will be gone before I ever retire.

[Malto Dextrin]

Be glad you don't get all the government you pay for.

[tadcf]

It just goes to show: The two natural economic theories (capitalism and socialism) cannot live in isolation and must move together.

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