Googling the Welfare State

The blogosphere overflows with Google Pundits; those who pooh-pooh, with a few search queries, an argument that runs counter to their own ideological assumptions, usually regarding a subject with which they possess only a passing familiarity. It's a familiar phenomenon, but a recent, particularly egregious, example of Google Punditry deserves to be singled out. In a blog post pompously titled "Everything You Know About Sweden is Wrong," American Prospect guest blogger K.A. Geier, who appears not to have previously written about Sweden, informs Atlantic writer and blogger Megan McArdle that she is "promulgat[ing] some misconceptions about Swedish social democracy." Unfortunately, it appears that everything Ms. Geier knows about Sweden is also wrong.

Geier argues that it is absurd to claim that Sweden's welfare "success" (cough) has benefited from a "homogeneous population" and cites "blogger and political science professor Lane Kenworthy to back me up on this point." According to Kenworthy, Sweden's "immigrant (foreign-born) share is virtually identical to America's, at about 13% of the population." Geier adds, with laughable understatement: "Obviously, Sweden does not have the same degree of racial diversity as the U.S. does, but its population is far from 'homogeneous.'"

This is a mind-bogglingly imprecise comparison. First, Geier, debunker of myths about Sweden and Swedish socialism, surely knows that the plurality of the foreign-born in Sweden are Finns and Finlandsvensk—Swedish-speaking Finns—who are very much a part of the Nordic welfare tradition. This will soon change, with the influx of asylum-seekers from the Middle East, and we'll soon see how much stress this puts on the "Swedish model." That said, and as Geier seems to concede but not comprehend, the remaining 87 percent are native-born Swedes with, for the most part, a common cultural, religious/irreligious, social, and political heritage. This is, obviously, not the case with native-born Americans, a patchwork of ethnicities and religious affiliations. (Incidentally, I am an American-born permanent resident of Sweden.)

Geier takes issue with McArdle's claim that Swedes have high "rates of long term disability, sick leave, and so forth," and huffs that her evidence consists of a single Swedish acquaintance bemoaning the disappearance of the "Protestant work ethic." The Google Pundit responds: "Scandinavians McArdle knows may indeed say all manner of things, but anecdotes are not data, and I don't think it would be a wild stretch to assume that McArdle's Scandinavian friends might be something of a self-selected (and hence unrepresentative) group." So Geier, debunker of myths, defender of the welfare state, upbraids McArdle for not providing any relevant data—and offers no data of her own.

Well, McArdle is correct. Sweden does have the highest rate of workers on sick leave in Europe, despite being consistently ranked by the OECD as Europe's healthiest country. As my former colleague Johan Norberg has observed, sick leave payments—which, at the time of the last election, were as high as 80 percent of a worker's salary—accounted for a staggering 16 percent of the government budget. It should be pointed out though that under the new, non-socialist government, changes to sick leave policy have resulted in a 13 percent decrease in the number of claims filed in 2007. (Personal, unrepresentative, and self-selected anecdote for Geier: An acquaintance of mine in Stockholm was on sick leave for six months, collecting three-quarters of his salary after his girlfriend left him, rendering him "burned out"—utmattningssyndrom—and incapable of work.)

She continues, again quoting, Kenworthy: "The country has a strong work ethos…During the 2000s the Swedish employment rate has averaged about 74% of the working-age population, two percentage points higher than in the United States." This is meaningless. Again, Geier surely knows that preceding the 2006 elections, when the Social Democrats were booted from power, the dominant campaign issue was the massive problem of unemployment. The government figure of 7 percent unemployment was repeatedly mocked by both former Prime Minister Göran Persson's detractors and allies. A study by McKinsey Global estimated the true figure—which included those on sick leave, in early retirement, in jobs programs—to be between 15 and 17 percent. Jan Edling, a researcher with the Social Democratic trade union LO, estimated the total figure of unemployed to be 19.7 percent. (Edling's report was suppressed and he was himself offered "early retirement.") The Confederation of Swedish Enterprise said the figure was 16.5 percent. Other studies ranged from 12 percent to 18 percent.

But Google Pundit Geier again goes back to her blog source, Lane Kenworthy, who writes that "The welfare state is generous, but most able-bodied Swedes of working age are expected to be employed." Yes, they are expected to be employed. But the Swedish daily Aftonbladet reported in 2006, "shocking figures" demonstrated that 109,000 people under 30 were unemployed, an 81 percent increase over 2001. These numbers, supplied by the government, are also almost surely understated.

And the problem of unemployment in Sweden loops back around to the difficulty Sweden has had in integrating its immigrants into the job market. As Swedish economist Esra Karakaya wrote in Aftonbladet in 2006, the unemployment rate among immigrants in Sweden is 29 percent—another staggering figure, in marked contrast to the joblessness rate among immigrants in this country. This, Karakaya convincingly argues, is "because the labor market is governed by rigid job security laws" that are incompatible with a globalized economy. Indeed, a recent study tracking the fortunes of Somali immigrants in Sweden and in Minneapolis (reported here in Swedish, summarized here in English) found that its sample group in the U.S. started approximately 800 companies. In Sweden, they managed only 38. In a recent editorial in the newspaper Expressen, Nima Sanandaji, a Kurdish immigrant, argued that it was "important to study how the Swedish system of benefits, taxes and [regulated] job market leads the same group of people to be successful on one side of the Atlantic and to social poverty and dependence in Sweden."

In other words, Swedish social democracy, and its concomitant hostility to entrepreneurship and overly generous network of financial benefits for immigrants and asylum seekers, is a significant contributor to high unemployment rates.

One final point. Amazingly, Geier revels that "the Swedish economy is competitive, the school system offers choice, and pensions are partially privatized" but fails to note—or is simply unaware—that almost all of these policies were either implemented or introduced by the conservative government of Carl Bildt, against the strenuous objections of the Swedish left, after the economy sunk into a deep recession in the 1990s.