On Thu, 09 Sep 2010 19:20:05 -0500, F. George McDuffee
wrote:


One of the major problems is that while "socialism," (with a
small s) has proven to be very workable in certain
countries, primarily Scandinavia,

Pay attention to the last sentence....

http://www.laissez-fairerepublic.com/Sweden.htm

The Future That Didn't Work

Among those countries afflicted with the more advanced stages of
welfare statism are Norway, the Netherlands, Denmark, and Sweden --
especially Sweden. In the past, Sweden has been held up by some as the
model mixed economy -- how to combine a vigorous capitalist industrial
base with a lavish social welfare system. It was even touted as "market
socialism" -- a future that seemed to work. Not any more. The negative
consequences of decades of the heavy welfare state burden can no longer
be postponed. The May 24, 1993 issue of FORBES reported on Sweden's
welfare state ("The Swedish Disease") -- and the condition it has left
that country.

"The Clinton Administration's liberals who are pushing for more
taxes, a bigger welfare state, bigger labor unions, currency devaluation
and an industrial policy should take note: The Swedish model is doing
abysmally.

"Sweden's industrial production has plunged 15 percent since 1989.
The jobless rate is 12% and rising. The budget deficit accounts for a
third of the central government's spending and 13% of the country's GDP
(compared with 5% in the U.S.). The currency is sinking even faster than
the dollar."

What is Sweden's problem? "The Swedish model is Sweden's problem,"
observes Ian Wachtmeister, a former aluminum company executive who heads
the recently formed, market-oriented New Democracy Party, and who was
elected to the Swedish parliament in 1991.

"People are sick of the Big Brother-type of state. It's all
connected with what's happening in Eastern Europe, because they had 100%
socialism and we had 70%," reports Wachtmeister.

"Sweden's welfare state has all but destroyed the country's work
ethic. The absentee rate in Swedish industry reached an astounding 25%
several years ago before recent welfare cutbacks encouraged people to
work more. Many companies used to overstaff themselves by 25% just to
make sure that they had enough workers on the production line."

When the Swedish welfare system was at its peak a few years ago, the
national health care system tended to encourage people to become sick.
According to the statistics, Sweden was the sickest society on earth at
that time. LIke anything else, when medical care is "free", an
increasing number of people find ways to take advantage of it. Sweden's
national health care system became a national scandal.

As Forbes points out, by becoming every Swede's rich grandfather,
the state has destroyed most peoples' incentive to save. According to
Sweden's current Finance Minister, Anne Wibble, "Most households in our
country do not have any private savings, and that means they are not
independent of either employers or or politicians."

Meanwhile, another hangover from Sweden's socialistic welfare binge
is that some of the world's highest taxes on capital and income have
driven Swedish entrepreneurs to less hostile environments in continental
Europe and America. The productive private sector began to shrink at an
accelerated rate. Three years ago Swedish banks collapsed, real estate
prices plunged fifty percent, and the government's budget deficit
exploded. The semi-capitalistic goose that had been laying the golden
eggs had finally keeled over. Sweden was in a hell of a mess. A
Soviet-style economic collapse was eminent.

"In 1991 Carl Bildt's conservative coalition was elected to clean up
the socialists' mess. Like some ancient hero of Norse legend, Carl Bildt
has been swinging a mighty ax to clear away the tangles of the welfare
state. Government expenditure has been cut by $11 billion (80 billion
kronor, equal to 6% of GDP). Welfare payments have been cut. Inflation
has been tamed to an underlying rate of 2%. A voucher system had been
introduced in the public school system. Capital gains taxes are 30%. The
top marginal tax rates on income are still 50% -- high, but that's a big
improvement over the 85% of the recent past."

But, will it be too little too late to turn Sweden around? Many of
Bildt's more ambitious reforms and privatization attempts have been
stalled partly by political opposition from the old-line reactionary
Social Democrats who held power for so long and brought Sweden to its
crisis situation.

The Forbe's article concludes with the following: "Sweden may or may
not recover fully from its socialistic experimentation. But this isn't
just a story about Sweden. It's about any country where politicians
believe in the infinite ability of the private sector to fund an
ambitious social agenda, be it through high taxes, mandates, regulations
or other forms of state interventions.

"The New Democracy Party's Wachtmeister worries that Sweden's
experience with market socialism has been lost on many of the liberals
in the Clinton Administration. The key lesson, as Sweden is now finding,
is that once in place this kind of socialism is very hard to dislodge."

"Right now I'd rather be in Sweden than in the U.S., because we have
seen the problems and are moving away from the welfare state," says
Wachtmeister. "On your side, you are moving right into it, and you risk
destroying your country."

I am the Sword of my Family
and the Shield of my Nation.
If sent, I will crush everything you have built,
burn everything you love,
and kill every one of you.
(Hebrew quote)