I spent last week in Copenhagen, campaigning alongside Danish conservatives in a knife-edge general election. Something did the trick: a last minute surge gave the Right a larger majority than anyone had predicted.
As well as a swing to the Right, there was a big swing within the Right. Four free-market parties had contested the election in a loose alliance, known as the Blue Bloc. The two establishment parties in the Blue Bloc lost ground to the two newcomers: the Euroskeptic Danish People’s Party, and the libertarian Liberal Alliance.
Nordic socialists losing — perhaps that sounds shocking or unusual to outsiders’ ears, but it has happened rather a lot over the past 20 years. National stereotypes have a bizarre longevity. Leftists the world over still tend to use “Scandinavia” as a kind of shorthand for “successful social democracy.”
In 2011, for example, Paul Krugman wrote, “Every time I read someone talking about the ‘collapsing welfare states of Europe,’ I have this urge to take that person on a forced walking tour of Stockholm.” When Krugman typed those words, Sweden had just re-elected the rightist government of Frederik Reinfeldt, which had cut taxes, pruned benefits and privatized a chunk of the pensions system. Indeed, Sweden had become something of a pinup for welfare reformers. As well as introducing school vouchers, it had linked its retirement age to life expectancy, so that it rose automatically, avoiding the pensions crisis that other Western states face.
I doubt this is what — to pluck an example at random — Bruce Springsteen meant when, in 2012, he urged the United States to adopt a “Swedish-style welfare state”.
It’s true that, last year, after a lengthy free-market stretch, Sweden elected the Social Democrats — largely because Reinfeldt lost ground, at the last minute, to an unpleasant anti-immigrant party called the Sweden Democrats. But every other Nordic state now has a conservative government — Norway, Denmark, Finland and, for that matter, Iceland, which, unlike the others, never properly went through a statist phase.
Yet, oddly, Scandinavia’s socialist reputation persists. Whenever I point to Norway as an example of how well a country can do outside the European Union — it tops the U.N. quality of life index — I know that I’ll get dozens of sarcastic responses along the lines of, “Oh, so you want Norwegian levels of spending, do you?” Well, they’d be an improvement on British spending levels — 39 percent of GDP instead of 45.
In fact, Scandinavia was never a successful model of social democracy in the first place. Swedish writer Nima Sanandaji shows in a new paper for the Institute of Economic Affairs that the region’s economic growth began in the late 19th century, long before its welfare states existed. In 1960, when the size of the state in Nordic countries was comparable to other industrialized democracies – ranging from 25 percent of GDP in Denmark to 32 percent in Norway – Scandinavian countries were the richest and most competitive on the planet. They began to fall behind as their governments expanded, but they had amassed enough social capital to sustain a full generation of statism. In the 1990s, they realized they were in a mess, and turned to market solutions. Denmark, for example, is now arguably the easiest place in Europe to fire someone – and, in consequence, has very high levels of employment, since companies aren’t worried about not being able to shed staff.
One way to test Sanandaji’s thesis is to look at Americans of Scandinavian descent. Their ancestors crossed the Atlantic before the expansion of the welfare state, bringing the same work ethic and culture. They have lived under relatively free-market governments; yet, on key indicators, they closely resemble Scandinavians proper: high employment, high salaries, high life expectancy.
In other words, something else probably underlies their industriousness and honesty. Max Weber, writing long before their taxes started to rise, attributed their success to Lutheranism. Whatever it is, it isn’t big government.
A similarly outdated stereotype exists in North America, where Canada is seen – including by some Canadians – as a kind of English-speaking Scandinavia. Ontario’s Robertson Davies – for my money the best English-language writer of the past half century – has a Swedish character in one of his novels declare herself very much at home in another “socialist monarchy.”
In fact, Canada traditionally self-defined as a hardier and more rugged place than America. Its immigration policy was based on keeping taxes lower than in the US, so as to compensate for the rougher climate. It, too, went through a statist interlude from the 1960s to the 1990s; and it, too, has emerged on the other side, taking a lower share of GDP in combined provincial and federal spending than the U.S. equivalent.
America, you have some catching up to do.
Dan Hannan is a British Conservative MEP.
