Is Scandinavia Still An Economic Utopia?

[Your Old Comrade]

Scandinavia is still viewed by many as the best economic and human region on Earth. Today we take a deep dive into the economic history of the region, and analyzing the good, the bad, and the ugly of the Nordic model.

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Timestamps:
0:00 The Facts
1:20 The Rise and Fall of Socialist Scandinavia
5:05 The "Nordic Model"
5:23 The Good
8:42 The Bad
11:22 The Ugly
13:32 A Look Ahead

[Tooting Carmen]

Interestingly, the Nordic countries do not have a minimum wage, which has long been seen as a staple of social democratic economics, BUT they historically have had very powerful and big trade unions instead, which have usually been able to negotiate generous pay and conditions in their respective fields and industries. Also, a generous welfare state works well in a (relatively) homogeneous society with high levels of trust and a strong work ethic, but when those things break down...rather less.

[Tooting Carmen]

N.B. All the same, I particularly like how Sweden (not sure about the others) grants mothers and fathers equal levels of maternity and paternity leave, both in terms of the number of weeks off work and in terms of pay.

[Sebastianus Rex]

The model is still good, Sweden is going to the drain because of idiotic immigration policies and extreme wokism not because of the economic model per se.

[nittionia]

Speaking in terms of quality of life standard, Scandinavia blows any place in the United States out of the water. And of course, their strong social capital is a driving factor of their success, which needs to be especially sustained now in more pressing conditions of diversity.

[Automata]

Speaking in terms of quality of life standard, Scandinavia blows any place in the United States out of the water.

I think the US is the best place to live in the world if you have the money.

[nittionia]

I think the US is the best place to live in the world if you have the money.

I personally really like living in the US, but yeah it does depend on your wealth. I would rather more of the population be able to access health care and education rather than just those who can afford it.

[Automata]

I would rather more of the population be able to access health care and education rather than just those who can afford it.

I totally agree. Unfortunately that is the biggest problem in the US.

[lei.talk]

...I would rather more of the population be able to access health care and education
rather than just those who can afford it.

in the united states,
is it legal for public hospitals to deny necessary medical care
if a person can not pay for it

or that public education is not freely available
(even college/university to those that have demonstrated the qualification)

Moving to France
Showed Me True Cost of ‘Free’ European Health Care,
Child Care, and Retirement

An oft-repeated phrase among those favoring taxpayer-funded health care, day care, and pensions is that such programs are “free.” However, I recently moved to France, and paying my social charges and taxes proves these services are anything but.

I expected taxes to be higher, but I was unprepared for the limitations that France’s system places on individual choice.

In reality, France’s “free” social programs cost more than higher taxes. There’s a non-financial cost when it comes to access and control. Health care and child care are extremely personal choices, and Americans may not realize the degree to which Europeans sacrifice control to government bureaucrats.

Let’s begin with the financial cost of France’s “free” health care, child care, and retirement. These programs are funded by France’s “social charges” taken from everyone’s paychecks. Social charges, separate from taxes, pay for “free” day care, maternity leave, unemployment, retirement, and health care.

Keep in mind that the French pay taxes in addition to social charges. By way of example, I pay roughly 1,300 euros (nearly $1,500) per month in mandatory social charges (which does not include my husband’s social charges), and we still pay taxes, too.

France’s taxpayer-funded health care system indeed covers wellness checkups and serious medical issues like chronic illness almost in full. One may not receive a large bill after these services, but calling it “free” ignores the facts and insults the millions of French residents paying social charges.

France’s social charges also fund day care, or “creche,” and each neighborhood has a day care center. This may seem idyllic, especially to working parents, but day care quality levels vary. Contrary to picturesque TikTok videos, some day care centers are poorly run, have mediocre food, and few enriching children’s activities. Furthermore, even if your day care is good, your child is not guaranteed a spot in the day care for which you pay social charges, as day care spots are largely income-based.

If you live in an area rife with housing projects (France requires that cities allot 25% of residencies to public housing), your child may not get into the day care center because low-income families get priority. If that’s the case, you must find another day care center or pay out of pocket for child care, even though you paid social charges.

Everyone pays, but only some get access. In other words, the government takes 20% or more of your monthly paycheck and then determines if you are worthy of receiving the services it forces you to pay for.

It bears mentioning that some wealthy neighborhoods pay a fine instead of creating social housing. In doing so, those neighborhoods avoid public housing, thereby reducing the number of needy families in their communities and allowing their children to go to the best day care centers.

The closest comparison in America is the wealthy who oppose school choice, while sending their own children to expensive private schools.

There are better ways to give families access to child care than government-mandated programs that create financial and social burdens.

Speaking of one-size-fits-all, that brings us to France’s pension system.

France’s pension system dates back to 1945 and is organized into categories, such as train operators, opera singers, dentists, and teachers, each with different retirement ages and requirements. All workers, salaried employees, and freelancers pay into their respective categories.

Somewhat like America’s Social Security, those working now fund the retirements of the elderly. In that regard, it’s not dissimilar from a Ponzi scheme, the investment scam that landed Bernard Madoff in prison.

France’s pensions, like American Social Security, are government-controlled. Government officials determine when and how much money you receive upon retirement. Imagine paying into a system your entire life, only to have French President Emmanuel Macron issue the French equivalent of an executive order and delay your retirement age—which happened recently with France’s pension reforms.

So, why don’t the French invest in private retirement accounts?

France’s crippling progressive income tax and social charges leave little money to invest. Moreover, high investment taxes make investing less advantageous for those with modest to middle-class incomes. It’s a progressive tax code, so the more you make, the more the government takes.

Moreover, French salaries are roughly half those in the United States. This, coupled with taxes and social charges, leaves little money left to invest, let alone spend on food, clothing, or life’s little luxuries. By the way, all goods are subject to a 20% value-added tax.

Some argue, “But at least in Europe, you get something for your taxes.” The United States spends 46% of its federal budget on Medicare, Medicaid, and Social Security. In the U.S., someone gets something, but that person may not be you. Imagine not getting something, but with half your income and double your taxes; that’s France.

Americans also idealize European labor protections, but those laws, too, come with downsides.

Most French workers are entitled to generous benefits, including unemployment, maternity leave, and vacation days. To be clear, everyone deserves access to gainful, dignified employment free of exploitation. France seeks to achieve that through government-mandated worker benefits and strict government control. Like most government policies, that negatively impacts the most vulnerable and creates a thriving black market.

France’s onerous labor laws and employment taxes push workers into “off the books” employment, and consumers tend to gravitate toward cheap labor. That’s especially common in industries where people pay other people directly, like for domestic work.

Imagine Marianne, a housekeeper. If Marianne does so as a “full employee,” the family employing her pays 28-40 euros ($30-$43) per hour, of which she keeps roughly 12-15 euros. ($13-$16). If Marianne is “off the books,” however, she charges what she wants and keeps every cent. As such, some workers, especially immigrants and refugees, work “off the books.”

Studies show that off-the-books labor represents more than 10.8% of France’s gross domestic product. Given the nature of off-the-books labor, it’s difficult to know exactly how many workers are paid off the books in any country. But in general, the higher the tax and regulatory burdens of employment, the greater the incentive to evade them.

Workers, especially those who are vulnerable or economically disadvantaged, ought keep as much of their paychecks as possible. But France’s bloated government is more interested in protecting people from themselves and, in the process, limits flexibility and freedom for those who need it most.

There’s no simple answer to providing the best services to the greatest number of people. But France shows that government one-size-fits-all policies are not the answer, nor are they “free.”

Americans on the right and left call for “free” services like health care. President Joe Biden’s 2021 American Families Plan boasted “free” education, including universal preschool. The conservative CEO of Americans United for Life called for making childbirth “free,” but I hope she is prepared to spend the money needed to make it “free” and is aware of the effect that government funding can have on access to resources, individual choice, and quality of care.

From across the Atlantic, I see America moving toward a European model, in which services are government-controlled. But for America to live up to its promise of being conceived in liberty, we must put responsibility in the hands of individuals and families.

[nittionia]

in the united states,
is it legal for public hospitals to deny necessary medical care
if a person can not pay for it

or that public education is not freely available
(even college/university to those that have demonstrated the qualification)

Hospitals can deny care if it is not emergency treatment. And yeah it doesn't matter how qualified you are for university, you need to pay for it