Bloody Scandinavian model yet again

By Lorenzo

This is based on a comment I made here.

 

There is a continuing line of commentary among social democrats, democratic socialists and progressivists generally to laud the Scandinavian model (aka Nordic model) as something for the US or Australia to follow. Matt Yglesias, following up from comments in the recent US Democratic Presidential candidate debate, continues this tradition (although, as one expects from Mr Yglesias, intelligently and well-informed).

Even so, I wish people would stop. Yes, looking at how other countries do things can be revealing and useful. But policy regimes evolve for specific reasons and, unless you understand those reasons, you are not going to be able to usefully apply any such lessons.

Let us leave aside whether the Scandinavian model has been oversold (pdf) (and that Nordics do even better in the US), or whether advocates understand the model as well as they think they do. Citing the Scandinavian model as a policy regime to adopt makes no sense for Australia, let alone the US.

If you are small, geographically contained, ethnically homogenous country of course you can run a social model that relies on congruent social bargaining at a relatively high tax-public good(+ extras) tradeoff. And, given the ease of information flows between officials and citizens and strong congruence in preferences and expectations, run the trade-off fairly efficiently.

None of these features apply to Australia or the US. Both are much more geographically varied (and if you don’t think that makes a difference for public policy, I invite you to take a tour around either the States of either, or the Provinces of Canada). Both are much more ethnically varied. (Over a quarter of Australians, 28%, are foreign born; around 13% of US residents are foreign born [pdf].) And ethnic diversity reduces social trust, with reduces the ability to centrally coordinate.

The biggest single public policy failure area in Australia is indigenous policy, and if you do not understand that poor information flows, divergent preferences and expectations–all due to profound differences in cultures and experiences–are central to said policy failures. you have not been paying attention. [Besides, Australia does as well as the Scandivanian countries on most indicators of well-being, including the Human Development Index, so it is not as if there is powerful motive to dramatically change policy regime.]

Togetherness we find easier to do.

One also notes that the more the US federal government does, the more popular respect for its institutions tend to fall. Over-reach beyond its useful coordinating capacity in such a large and diverse nation might have something to do with that. (And the latest substantial expansion of US federal involvement in healthcare has not been a popular success.)

Of course both US and Australia have evolved lower tax-public good+ trade offs. Indeed, as Sweden has become more ethnically diverse, Sweden itself is having increasing trouble making “the Scandinavian model” work.

The notion that public policy evolved in a way that suited the nature of the countries in Scandinavia but somehow weirdly went off the rails in Australia and the US does not make a lot of sense.

No, the Scandinavian model is not a good policy regime model for Australia or the US however much individual policies may be revealing and useful, even adaptable, to very different conditions.

 

[Cross-posted from Thinking Out Aloud.]

11 Comments

  1. Posted October 23, 2015 at 9:02 am | Permalink

    I agree entirely. I have studied Swedish social democracy both in the literature and at first hand, admire what has been achieved, and accept that it is not a model that will work here, for the reasons you give. Moreover, some of what we do is also admirable — we lead the world in voluntary activity, for example, which is good for us individually and socially. Cradle-to-grave social welfare doesn’t provide much for citizens to do in a voluntary way.

  2. Posted October 23, 2015 at 9:04 am | Permalink

    A footnote to the above. The worst graffiti I saw in Europe at that time (early 1990s) was in Sweden.

  3. Posted October 23, 2015 at 10:45 am | Permalink

    Thanks Don! Love the voluntary point. (Have also added in that Australia does as well as the Nordics on the Human Development Index.)

  4. Nigel Davies
    Posted October 23, 2015 at 2:38 pm | Permalink

    Possibly there is also a social cohesion factor in the ‘popular memory of foreign threats’.

    The reason that Israel does so well is that it is a ‘pull together or hang separately’ state.

    Denmark, Norway and Finland were invaded only 75 years ago, (and Sweden was threatened through the war). Then all were threatened by the Soviets for the next 40 years.

    All of which has done wonders to make intermal politics in those countries (like in West Germany or Switzerland) remarkably cohesive.

    The fact that their social cohesion has been far weaker in the last 20 years may be partly due to immigration, and partly due to less danger from outside… Lets see if Putin can reverse that for them…

  5. Posted October 25, 2015 at 4:38 am | Permalink

    Nigel: A threatening Them can indeed generate a strong sense of Us.

    I would be useful to examine indicators of social cohesion in the Nordic countries and see if there were any revealing differences.

  6. michael
    Posted October 25, 2015 at 2:32 pm | Permalink

    Why is social cohesion necessary for successful western societies?

    and if so do you have any empirical work or data on all this?

  7. Posted October 26, 2015 at 8:35 am | Permalink

    There is no doubt that most advocates of the Nordic model in Australia misunderstand the phenomenon quite badly. Sweden, for instance, has introduced vouchers into more areas of social policy than any state or federal government in the United States (supposedly the home of vouchers). This allows for a personalisation of social provision that explains in part the continuing popularity of extensive social entitlements in Sweden, even as ethnic and cultural homeogeneity is weakening. Yet most Swedophiles in Australia loathe the idea of vouchers. Vouchers in Sweden allow it to have a relatively small bureaucracy in comparison with federal over-government in Australian and the US. So while personal taxation may be high in Sweden, big government and big bureacracy are actually not dominant features of the political culture in the way that they are in Australia. Moreover, Sweden’s company tax rate is now considerably lower than Australia’s.

    Social cohesion in Sweden is more organic than in Australia, and advocates of the Nordic model ignore this organicism and tend to expect Australian governments to create social cohesion (which it cannot do). Religion is curiously a strong part of this organic cohesion despite low church attendances – the culturally rich Church of Sweden has generated more of the country’s social cohesion than the state – another insight lost to the culturally poor tax-and-spend leftists here who urge us to look to Scandinavia for the wrong reasons.

  8. Posted October 26, 2015 at 11:53 am | Permalink

    [email protected], thanks and quite so.

    [email protected]

    Why is social cohesion necessary for successful western societies?

    Given the current state of the Middle East, is it not obvious that a certain amount of social cohesion is necessary for societies to function at all, let alone well?

    And empirical evidence on what particularly? The links already include some connections to empirical evidence, but if you want some broader information, I suggest following up some of the links here for example. While this is a particularly good website for general issues of social evolution.

  9. Posted October 26, 2015 at 12:25 pm | Permalink

    Why is social cohesion necessary? There are two ways of answering this. One is to play an academic game, and cite evidence of correlations between high levels of social cohesion and certain socially desirable outcomes, such as low crime, willingness to trust strangers, social stability, intact familial relationships, employment security. The other way is more visceral and involves looking at suburbs that individuals like ourselves choose to live in. Faced with two choices of suburb – one with high crime rates, large numbers of newly arrived migrants, big disparity between bad schools and good schools, low trust of ethnically different people, and numerous visual reminders of cultural unfamiliarity – and, on the other hand, Chatswood in Sydney or Albert Park in Melbourne, which one do we choose? None of choose the former. That is because social cohesion makes for a better life, as expressed in our choice of suburbs (no matter what ideology we might verbally subscribe to).

  10. Posted October 26, 2015 at 2:01 pm | Permalink

    [email protected] Actually, Chatswood has lots of migrants. But East Asian migrants, so not exactly a counter example.

  11. Posted October 26, 2015 at 2:57 pm | Permalink

    But no Lebanese, Turks, Arab Moslems and unskilled Pacific Island workers – the ones the Chatswood people try to avoid as neighbours. And the ones libertarians equally try to avoid as neighbours.

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