12 ms·
The title is misleading. While an amazing milestone, Norwegians can't head down to their local central bank branch and draw down their share of the fund. It's a
by jbyers 13y ago
The title is misleading. While an amazing milestone, Norwegians can't head down to their local central bank branch and draw down their share of the fund. It's a bit like saying every man, woman, and child in the United States owes $200K because of the national debt.
- Dewie 13y agoIt's a bit unreasonable to take the title literally in this case, since it would just be an absolutely horrendous way to use the money.
- angersock 13y agoIsn't that basically what many Middle-Eastern countries do, though?
- Dewie 13y agoAre they giving away most of it to the citizens? (I have heard that some countries, maybe Saudi, have things like free petrol for everyone.) And is it in one big sum, like on the order of something like 200,000USD? I can't see how the latter would work out. I can't imagine how giving most of it to the citizens would work out in the first place, but clearly I'm missing something.
- angersock 13y agoHint: who is considered a citizen?
- patmcguire 13y agoVery, very true. Brunei and Kuwait are terrible offenders - huge sections of the population (more than half in Brunei) aren't citizens and can't be, no matter how many generations they've been there. Saudi Arabia and the Gulf States also have a ton of foreign workers who aren't citizens. Saudi Arabia is second to the US in remittances sent out... http://english.alarabiya.net/en/business/economy/2013/10/27/Kingdom-world-s-second-top-remittance-sending-country.html http://english.alarabiya.net/en/business/economy/2013/10/27/... Think about big that has to be - it's more than any of the most developed EU states to the rest of the EU (how many foreign workers are in the UK? Germany? A lot. And they probably pay much better). It's more than comes out of Russia, when half the GDP of some of the ex-Soviet states is Russian remittances. So while maybe you're entitled to certain things as a citizen, a huge amount of what makes that possible is done by people who aren't.
- Dewie 13y agoDoesn't sound that applicable to Norway in that case.
- jonnathanson 13y agoYes, that's pretty much what a lot of Middle Eastern countries do, and it's a terrible long-term economic strategy. Oil wealth is notoriously volatile, and it creates all manner of bad habits (for instance, scaling a services economy to match the scale of the oil wealth; the latter is a finite commodity, and the former is extremely hard to scale down once built up). Norway has been relatively smart in managing its resource boom. It hasn't completely subsidized the cost of living, spent its oil wealth on giant, shiny objects, hoarded the wealth amongst a corrupt and tiny class of elites, or built an enormous social-services machine that won't survive an oil bust or pricing collapse. It's not spending above its means, presumably under the realization that its means came from a geological lottery ticket. When your country hits the oil jackpot, your job is to convert the oil money to real industry. You don't splurge on mega-hotels, distribute the money frivolously, etc. You need to use it to create the basis for a non-oil-dependent economy.
- chii 13y agowhat other industry does norway have that is created with oil wealth?
- aaronblohowiak 13y agoShipping
- ljosa 13y agoThe shipping was there first; it has been one of the most important industries in Norway since the late 1700s.
- LanceH 13y agoThey purchased other industry at least, through stocks.
- daliusd 13y agohttp://en.wikipedia.org/wiki/File:Norwar_Exports_Tree_Map_(2009).pdf http://en.wikipedia.org/wiki/File:Norwar_Exports_Tree_Map_(2... From http://en.wikipedia.org/wiki/Economy_of_Norway#Economic_structure_and_sustained_growth http://en.wikipedia.org/wiki/Economy_of_Norway#Economic_stru...
- MaysonL 13y agoIt's also basically what Maggy Thatcher did with Britain's North Sea oil money.
- gaius 13y agoIt's funny, discussing this story on Facebook, a friend of mine, staunch left-winger, said that Thatcher "pissed the money away". Hang on a second, I said. Are you now saying that government spending/the welfare state is just pissing money away?
- hobbes300 13y agoBeing left-wing doesn't mean you agree with all government spending
- gaius 13y agoSure. But assuming we had saved the money, what would have been not-paid-for in the meantime?
- ZeroGravitas 13y agoTax cuts?
- ZeroGravitas 13y agoWell, if you spend it over a short period rather than a long period, it can be considered "pissing money away" without changing your views on what it was spent on. Having said that, I don't quite recall Thatcher being famous for spending oil revenues on expanding the welfare state (and it doesn't sound like something her supporters, then or now, would approve of) so maybe I'm missing something here?
- gaius 13y agoThe money went somewhere, right? It was spent on something, not invested. Ergo, something was paid for that would not otherwise have been.
- jfarmer 13y agoThere was a great piece in the financial times called "The Iraqi who saved Norway from oil": http://www.ft.com/intl/cms/s/0/99680a04-92a0-11de-b63b-00144feabdc0.html#axzz2pz8Cr79p http://www.ft.com/intl/cms/s/0/99680a04-92a0-11de-b63b-00144...
- lsaferite 13y agoSure, it's not like an individual citizen could go to his bank and withdraw the funds, but it's a national wealth and is being expressed as an amount per person. It's the same with your $200k debt per US citizen number. The Norwegian government just happens to have $160k in an investment fund per citizen. I'm not sure what the overall budget for Norway looks like, but I'd guess it's a bit better than the US budget.
- Someone 13y agoFor the curious: http://www.statsbudsjettet.no/Statsbudsjettet-2014/English/ http://www.statsbudsjettet.no/Statsbudsjettet-2014/English/. "the structural non-oil budget deficit is estimated at NOK 135.1 billion [...] Net cash flow from petroleum activities is estimated at NOK 314 billion. [...] The consolidated surplus on the Fiscal Budget and the Government Pension Fund, including NOK 147 billion in interest and dividends, is estimated at NOK 328 billion (corresponding to 10.6 of GDP)" I guess a percent sign is missing there. That would make the surplus 10.6% of GDP.
- seanmcdirmid 13y ago> It's the same with your $200k debt per US citizen number. Not really: in a progressive system, one's share of that debt when net worth is considered is probably more like $20k, thanks to wealth disparity. And again, given equitable spending per citizen (regardless of taxes paid), they really do have about $160k per citizen in that investment fund.
- lsaferite 13y agoI'm curious what you're getting at with 'progressive system' statement. I was just pointing out the absolute division of the numbers for both seem like a similar, if ultimately meaningless, metric. I won't profess to be an economist and/or understand the intricate differences between the US and NO government taxing/budgeting/accounting, so any enlightenment is welcome.
- adventured 13y agoJust for reference (these aren't exact, but close enough): 2013 Norway Govt expenditures: $182 billion, per person: $36,000 2013 US Govt expenditures: $3.93 trillion, per person: $13,000 ($22,000 counting local + state; I have no idea how Norway's government spending looks locally)
- deleted 13y ago[deleted]
- robbiep 13y agoWhich is exactly what the article says 2 paragraphs in
- merloen 13y agoThat would also be misleading since everyone's share of the debt is $54,537, not $200K.
- nhaehnle 13y agoActually, the debt statement is more problematic even ignoring the questionable number that you cite, because the debt is mostly just a representation of relationships between citizens and institutions within a country. If you want a reasonable comparison, you have to restrict yourself to foreign debt only.