If you have 5 minutes, here’s a very valuable economics lesson from the land of the midnight sun. Sweden was a very prosperous country from 1870 – 1970, with an economy that was the envy of Europe, and the 4th highest per capita income in the world. But as they set upon the socialist path of its current welfare state in the 1970’s and ‘80s, it’s economy quickly headed over the cliff. By the early 1990’s they were already in deep stagnation.
They are currently trying to claw their way back by reversing some of the socialist policies put in place 30 years ago (including their medical system), and return to the free market system. Easier said then done. Much, much easier said than done.
We wish them luck. They must find us foolish for steering our great ship directly into the rocky shoals that lead nowhere other than over the falls.
UPDATE: kmbr, currently working in still-socialist Sweden provides first person insight in her comment to this post and provides an excellent link to The Scandinavian-Welfare Myth Revisited from von Mises Institute. Here’s part of the conclusion:
However, the real point of all this is that the world at large is so unfree that even the massive Scandinavian welfare states can be considered among the "most free" countries in the world. While things have generally moved in the right direction in Scandinavia in terms of increased economic freedom, the very opposite trend seems to be taking place in several other countries, particularly the United States. Seeing as the United States has already descended to the level of Denmark in terms of economic freedom, one can only wonder how long it will be before it finds itself approaching Finland, Norway, and Sweden.
It’s all about welfare and control. We’re on the wrong path from both vantage points.
Great article, thanks kmbr.