Sweden’s experiment with ‘democratic socialism’ resulted in four decades of lost progress. Let’s learn from their mistake, not emulate it.
By Anders Ingemarson September 5, 2018
Alexandria Ocasio-Cortez’s July 26 Democratic primary win over stalwart Rep. Joe Crowley in New York’s 14th congressional district has given “democratic socialism” a new lease on life. The progressive poster grandma and grandpa — Sens. Elizabeth Warren and Bernie Sanders — have been blessed with a millennial poster grandchild, and mainstream media and leftists across the country are experiencing unseasonal spring fever as we approach the fall election.
Ocasio-Cortez’s elevation to celebrity status has not only set the far left on fire, it has also created an opportunity to highlight and debunk some of the myths associated with “democratic socialism,” and its supposedly successful implementation in the Nordic countries, particularly in Norway, Sweden, Denmark and Finland. As an immigrant from Sweden with 30-plus years of “on-site” experience, my perspective, and that of some of my fellow countrymen who also didn’t drink the Kool-Aid, is different from that of Ocasio-Cortez, Warren, Sanders, and their “democratic socialist” followers.
Stefan Carlsson’s “The Sweden Myth” and Johan Norberg’s “How Laissez-Faire Made Sweden Rich” explain that Sweden is a mixed economy with significant free market elements — private property, private businesses, a functioning banking system, free trade, etc. — coupled with welfare statist programs such as socialized — government financed, operated, and regulated — education and health care.
They explain that the free market elements are responsible for the country’s relative wealth and health. Much of the wealth in real terms was created before and in the early stages of the welfare state, between 1870 and 1960, when Sweden was one of the countries with the lowest levels of regulation and taxation in Europe.
The one period when Sweden practiced what may be considered “democratic socialism” was between 1960 and 1980. During this period, the country nationalized industry and massively expanded the welfare state financed by tax increases and currency devaluations, and it paid a high price. Sweden fell from the top of the list of wealthiest countries in the world to the middle of the pack of industrialized nations, bringing it to the brink of ruin in the 1990s.
Realizing the practical consequences of the disastrous policies, the country cut back on its welfare programs and reduced corporate taxes, leading to somewhat of a comeback in the past two decades. But the experiment with “democratic socialism” resulted in four decades of lost progress.
Also, as welfare statism is still entrenched, with socialized medicine and education, and stifling environmental and other regulations, Swedes continue to pay the price: Economic growth is much lower than it would have been had the country returned to its pre-1960 levels of government involvement in the economy.
What is less understood than the financial cost of “democratic socialism” in particular and welfare statism in general is the intangible spiritual costs: It slowly suffocates the individualist spirit. A Swede will most likely tell you that he’s happy and that Sweden is a good, if cold, country. He may grudgingly comment on waiting lines for health care, and say his kids don’t get as good an education as he did. But in the next breath he will tell you this is the price you have to pay for the “safety net” the welfare state provides.
If consistently implemented welfare statism is as financially ruinous as the Swedish 20th century experiment shows, what explains this attitude? When from grandparent to parent to child your freedoms are gradually taken away and you become more and more dependent on the state, and when you’re taught in the socialized education system from preschool and up that this is how it should be, your outlook on life changes. You gradually lose your independent mind and your self-reliance — you lose the individualist spirit.
You start to look to the state as the guarantor of your welfare, although it is the aggressor taking away your rights. It is ironically but sadly an expression of Stockholm syndrome on a national scale: “a psychological phenomenon in which hostages express empathy, sympathy and have positive feelings towards their captors, sometimes to the point of defending them.”
Sweden has much to teach us, but it is the opposite of what the progressive “democratic socialists” would like us to think. Swedes can primarily teach us what financial and spiritual mistakes to avoid. It is their costly missteps during the second half of the 20th century we should learn from.
The United States should reduce the welfare state instead of expanding it, by reducing taxes and regulations and cutting government spending, including phasing out Social Security, Medicare, and public education. This would empower Americans to take control of their retirement, health care, and education decisions. With empowerment comes confidence in managing your life according to your values without hand-holding from the state — and a strengthening of the individualist “can do” spirit that is the engine of a thriving society.
Anders Ingemarson is the COO (Chief Opinionated Officer) and editor of SEPARATE! (separatestateandtheeconomy.com) championing the moral case for separating state and the economy.