6 ms·

This is cool, though I worry that people will conclude (as the Icelandic president has) that Iceland has "blended the best of Europe and the United States here,

by mhartl 18y ago

This is cool, though I worry that people will conclude (as the Icelandic president has) that Iceland has "blended the best of Europe and the United States here, the Nordic welfare system with the American entrepreneurial spirit". There are a lot of policies that work well with an ethnically homogeneous society of 313,000 people but completely fail on a larger scale. This scaling problem is the perennial defect of socialism. (Well, one of them, anyway.) In contrast, free markets appear to scale indefinitely, naturally finding the right business unit sizes along the way. (For example, for gourmet restaurants, it's ~1 restaurant; for fast food restaurants, it's a national or global branded chain.) I suspect that the natural business unit size for much of Iceland's 'Nordic welfare system' is approximately 313,000 ethnically homogeneous people.

sbt 18y ago
Good point. Socialism doesn't scale. This is more of an issue about the size and homogenity of the population than any ingenious public policy. Unfortunately, living in a homogenous country isn't terribly exciting or stimulating.
- vidar 18y ago
  Most of the points raised here about Iceland (my home country) and your so-called "socialism" apply equally well to Sweden, Norway and Denmark. Look them up in the happiness, education and economic statistics. They are multimillion populations that are doing quite nicely, "socialism" notwithstanding.
  - anamax 18y ago
    There are US cities with more people and there are more Swedes in Minnesota than in Sweden. We'll see how those monolithic countries cope with an influx of "other". I wish them the best.
  - sbt 18y ago
    I apologize for being vague. First off, Scandinavia is not socialist. It is pragmatic, if anything. Secondly, when I said socialism doesn't scale I was thinking about countries with at least 20 million citizens. However, it seems likely that some of the policies employed in Scandinavia in general simply wouldn't apply to a country like the UK. It seems likely that larger populations are more difficult to organize, and one has to resort to a more "greedy" approach. That said, Scandinavia is not all about homogenity and scale. It's also about culture: work-ethic, egalitarianism and a culture where people don't just screw each other over to make a fast buck.
    - michael_dorfman 18y ago
      20 million people is the maximum size for Scandinavian-style socialism? In that case, here's a suggestion-- why not divide the US into, say, fifty separate geographical administrative units? (By the way: I live in Norway, and was recently screwed over big-time by Norwegians looking to make a fast buck. In my experience, the "work ethic" is far below that of hte US. But I wouldn't be too quick to generalize....)
      - JesseAldridge 18y ago
        We tried dividing it in two once -- didn't work out so well...
        michael_dorfman 18y ago
        Yeah, that's why I thought 50 semi-independent units might do the trick. I figure one for the islands out in the Pacific, and one for the big chunk hanging off of Canada; and the other 48 can divide the piece between Canada and Mexico. I've even got cute names picked out, if you'd like to hear them...
        Xichekolas 18y ago
        I think the reason a "nation with one big budget and financial system" works better than "50 small budgets and systems in a confederacy" is that the smaller, poorer states benefit heavily from the bigger richer states. In general, taxpayers in rich states get back less than they pay in federal taxes, and the beneficiaries are poorer states, who get back more than they pay. It's a good setup, because prosperity in one area can help the whole country, and it lessons the infighting among the states. A rising tide lifts all boats if you will. If one state suddenly goes from 'poor' to 'rich' (like Texas when oil became a big deal) then other states will automatically benefit.
  - johnyzee 18y ago
    Honestly, both Sweden, Denmark and Norway have growing problems with influx of immigrants and refugees, who are unable to contribute, but nonetheless must be offered the same benefits as everyone else. This is creating a dangerous backlash. To say that you can't generalize about work ethic and business integrity just shows a lack of experience. Please travel to the rest of the world. The reason our countries are like this is what's been hinted at: Affluency and homogenous cultures. The real test of a society, in my opinion, is what happens when you have to adapt? When diverse groups join or sources of wealth become scarcer. In this regard the American model has really proven itself: Let everyone in, but expect them to make it work for themselves instead of having everything handed to them. (Unfortunately, lately America is preferring the Fort Apache model.)
    - michael_dorfman 18y ago
      I'm one of those "immigrants" in Norway, and I seem to have been able to contribute just fine-- in fact, my start-up employees 30 people, most of them natives. My reticence to generalize about work ethic and business integrity is not due to a lack of experience-- I have travelled a fair bit-- but because stereotyping based on anecdotal experience seems dangerous.
      - gahahaha 18y ago
        An immigrant, cool, which part of Somalia do you come from? I am very impressed that you adapted so well from being an illiterate sheep herder to a highly structured western society, and was even able to start your own company. Good job. Joking aside. Highly skilled workers like yourself immigrating isn't the problem. People aren't racists, but they are also not blinded by ideology like people on the left (be kind to others) and right (free movement of people) who, for different reasons welcome unlimited immigration.
        michael_dorfman 18y ago
        People aren't racists? You sure about that? I don't remember saying anything about "unlimited" immigration, by the way...
miked 18y ago
Over the last several decades I've been reading articles in the US/UK press of the "it's so glorious to live in Scandanavian welfare state X". The young whippersnappers that read HN won't remember these, of course. In the past, X was almost always Sweden. In Sweden and other Scandanavian countries there was always plenty of criticism of the US and its racial problems and how they didn't suffer any of those. Then they began to import non-Scandanavians and things changed. Malmo, Sweden now has the highest rape rate in the developed world. Author Bruce Bawer, a political liberal, published a book critical of evangelical Christians years ago and then moved to Norway to marry his partner (they're gay). Here's what he werote a few weeks ago: (http://memo.brucebawer.com/ http://memo.brucebawer.com/) "During the nine years and two weeks that I've lived in Oslo, I've seen the city change significantly -- for the worse. I don't remember exactly when it started reminding me of New York in the 1970s and 80s, but by now the resemblance is undeniable. Burglary, rape, gay-bashing, mugging, graffiti, vandalism: you name it, we've got it in spades, and it's still on the rise. Public stabbings and gang fights have become routine...The statistics are dire. Last month came news that the rate of reported crimes in Oslo is now four times that of New York; last week it emerged that Oslo's rape figures reached an all-time high in 2007; today it was reported that over 99 percent of street robberies in the city go unsolved. To any unblinkered individual who lives here, these statistics are no surprise. Yet civic authorities, faced with the steady erosion of law and order, exude indifference and ineffectuality." As for Iceland, it elected a government in the late 1980's that enacted a number of free-market reforms and, by an amazing coincidence, the economy took off. "Much of the nation’s prosperity is the result of free-market policies, including a 36 percent flat tax on labor income, a 10 percent flat tax on capital income, and a corporate tax rate of just 18 percent (down from 50 percent at the end of the 1980s)." http://www.cato-at-liberty.org/2008/02/21/iceland-and-taiwan-to-slash-corporate-tax-rates/ http://www.cato-at-liberty.org/2008/02/21/iceland-and-taiwan... Amazingly, The Guardian couldn't find space to mention any of that.
- ible 18y ago
  Regarding your final point, the article does mention it, though not in detail. "I believe we have blended the best of Europe and the United States here, the Nordic welfare system with the American entrepreneurial spirit,' he said, pointing out that Iceland, unlike the other Nordic countries, had exceptionally low personal and corporate tax rates. 'This has meant not only that Icelandic companies stay and foreign ones come, but that we have increased by 20 per cent our tax revenue owing to increased turnover.'" The article presents a pretty narrative, not a substantive account of different economic theories and their effects, but it does mention both the welfare state policies and the free-market ones, suggesting that choosing the best of both is what has improved Iceland. On the surface this seems sensible to me. The Nordic countries generally have better 'quality of life' than the US does, the US generally is stronger economically.

by mhartl 18y ago

sbt 18y ago

Good point. Socialism doesn't scale. This is more of an issue about the size and homogenity of the population than any ingenious public policy. Unfortunately, living in a homogenous country isn't terribly exciting or stimulating.

vidar 18y ago
Most of the points raised here about Iceland (my home country) and your so-called "socialism" apply equally well to Sweden, Norway and Denmark. Look them up in the happiness, education and economic statistics. They are multimillion populations that are doing quite nicely, "socialism" notwithstanding.
- anamax 18y ago
  There are US cities with more people and there are more Swedes in Minnesota than in Sweden. We'll see how those monolithic countries cope with an influx of "other". I wish them the best.
- sbt 18y ago
  I apologize for being vague. First off, Scandinavia is not socialist. It is pragmatic, if anything. Secondly, when I said socialism doesn't scale I was thinking about countries with at least 20 million citizens. However, it seems likely that some of the policies employed in Scandinavia in general simply wouldn't apply to a country like the UK. It seems likely that larger populations are more difficult to organize, and one has to resort to a more "greedy" approach. That said, Scandinavia is not all about homogenity and scale. It's also about culture: work-ethic, egalitarianism and a culture where people don't just screw each other over to make a fast buck.
  - michael_dorfman 18y ago
    20 million people is the maximum size for Scandinavian-style socialism? In that case, here's a suggestion-- why not divide the US into, say, fifty separate geographical administrative units? (By the way: I live in Norway, and was recently screwed over big-time by Norwegians looking to make a fast buck. In my experience, the "work ethic" is far below that of hte US. But I wouldn't be too quick to generalize....)
    - JesseAldridge 18y ago
      We tried dividing it in two once -- didn't work out so well...
      - michael_dorfman 18y ago
        Yeah, that's why I thought 50 semi-independent units might do the trick. I figure one for the islands out in the Pacific, and one for the big chunk hanging off of Canada; and the other 48 can divide the piece between Canada and Mexico. I've even got cute names picked out, if you'd like to hear them...
        Xichekolas 18y ago
        I think the reason a "nation with one big budget and financial system" works better than "50 small budgets and systems in a confederacy" is that the smaller, poorer states benefit heavily from the bigger richer states. In general, taxpayers in rich states get back less than they pay in federal taxes, and the beneficiaries are poorer states, who get back more than they pay. It's a good setup, because prosperity in one area can help the whole country, and it lessons the infighting among the states. A rising tide lifts all boats if you will. If one state suddenly goes from 'poor' to 'rich' (like Texas when oil became a big deal) then other states will automatically benefit.
- johnyzee 18y ago
  Honestly, both Sweden, Denmark and Norway have growing problems with influx of immigrants and refugees, who are unable to contribute, but nonetheless must be offered the same benefits as everyone else. This is creating a dangerous backlash. To say that you can't generalize about work ethic and business integrity just shows a lack of experience. Please travel to the rest of the world. The reason our countries are like this is what's been hinted at: Affluency and homogenous cultures. The real test of a society, in my opinion, is what happens when you have to adapt? When diverse groups join or sources of wealth become scarcer. In this regard the American model has really proven itself: Let everyone in, but expect them to make it work for themselves instead of having everything handed to them. (Unfortunately, lately America is preferring the Fort Apache model.)
  - michael_dorfman 18y ago
    I'm one of those "immigrants" in Norway, and I seem to have been able to contribute just fine-- in fact, my start-up employees 30 people, most of them natives. My reticence to generalize about work ethic and business integrity is not due to a lack of experience-- I have travelled a fair bit-- but because stereotyping based on anecdotal experience seems dangerous.
    - gahahaha 18y ago
      An immigrant, cool, which part of Somalia do you come from? I am very impressed that you adapted so well from being an illiterate sheep herder to a highly structured western society, and was even able to start your own company. Good job. Joking aside. Highly skilled workers like yourself immigrating isn't the problem. People aren't racists, but they are also not blinded by ideology like people on the left (be kind to others) and right (free movement of people) who, for different reasons welcome unlimited immigration.
      - michael_dorfman 18y ago
        People aren't racists? You sure about that? I don't remember saying anything about "unlimited" immigration, by the way...

miked 18y ago

Over the last several decades I've been reading articles in the US/UK press of the "it's so glorious to live in Scandanavian welfare state X". The young whippersnappers that read HN won't remember these, of course. In the past, X was almost always Sweden. In Sweden and other Scandanavian countries there was always plenty of criticism of the US and its racial problems and how they didn't suffer any of those. Then they began to import non-Scandanavians and things changed. Malmo, Sweden now has the highest rape rate in the developed world. Author Bruce Bawer, a political liberal, published a book critical of evangelical Christians years ago and then moved to Norway to marry his partner (they're gay). Here's what he werote a few weeks ago: (http://memo.brucebawer.com/ http://memo.brucebawer.com/) "During the nine years and two weeks that I've lived in Oslo, I've seen the city change significantly -- for the worse. I don't remember exactly when it started reminding me of New York in the 1970s and 80s, but by now the resemblance is undeniable. Burglary, rape, gay-bashing, mugging, graffiti, vandalism: you name it, we've got it in spades, and it's still on the rise. Public stabbings and gang fights have become routine...The statistics are dire. Last month came news that the rate of reported crimes in Oslo is now four times that of New York; last week it emerged that Oslo's rape figures reached an all-time high in 2007; today it was reported that over 99 percent of street robberies in the city go unsolved. To any unblinkered individual who lives here, these statistics are no surprise. Yet civic authorities, faced with the steady erosion of law and order, exude indifference and ineffectuality." As for Iceland, it elected a government in the late 1980's that enacted a number of free-market reforms and, by an amazing coincidence, the economy took off. "Much of the nation’s prosperity is the result of free-market policies, including a 36 percent flat tax on labor income, a 10 percent flat tax on capital income, and a corporate tax rate of just 18 percent (down from 50 percent at the end of the 1980s)." http://www.cato-at-liberty.org/2008/02/21/iceland-and-taiwan-to-slash-corporate-tax-rates/ http://www.cato-at-liberty.org/2008/02/21/iceland-and-taiwan... Amazingly, The Guardian couldn't find space to mention any of that.

ible 18y ago
Regarding your final point, the article does mention it, though not in detail. "I believe we have blended the best of Europe and the United States here, the Nordic welfare system with the American entrepreneurial spirit,' he said, pointing out that Iceland, unlike the other Nordic countries, had exceptionally low personal and corporate tax rates. 'This has meant not only that Icelandic companies stay and foreign ones come, but that we have increased by 20 per cent our tax revenue owing to increased turnover.'" The article presents a pretty narrative, not a substantive account of different economic theories and their effects, but it does mention both the welfare state policies and the free-market ones, suggesting that choosing the best of both is what has improved Iceland. On the surface this seems sensible to me. The Nordic countries generally have better 'quality of life' than the US does, the US generally is stronger economically.