Showing posts with label EuroZone. Show all posts
Showing posts with label EuroZone. Show all posts

Tuesday, May 20, 2014

A Global Model For Equity

Conservatives in this country live inside of a bubble but we, as Americans, live inside one as well. I lived in Europe for a year and it honestly help me break out of the United States bubble. We have far too many notions in this country (way too many dictated by the Right) that simply aren't true. For example, democratic socialism is viewed largely with disdain. Certainly, I have my problems with it but it's not communism/Marxism/boiling pit of sewage as we are nauseatingly warned day after day by the right wing bubble.

This myth is more or less destroyed by this recent piece in the Christian Science Monitor. Let's start off with this graphic.

What kind of a life does this mean for Iceland, Norway, Denmark, Finland and Sweden?

They get comprehensive pensions, unemployment insurance, and universal health care. Losing a job, while professionally defeating, doesn’t turn into financial demise. Nor does a long-term illness. The welfare state means free university education and heavily subsidized all-day preschools. Public spending on day care and early education in the Nordic countries averages 1.4 percent of gross domestic product; it is less than 0.4 percent in the US, for example. The result is a robust middle class. All five Nordic nations rank in the top 10 most equal countries globally, according to the OECD. (The US, by comparison, sits at 31, just above Turkey and Mexico.) 

How does this happen? 

The earned income tax burden for a family of four with a single wage earner in Sweden is close to 38 percent, according to the Organization for Economic Cooperation and Development (OECD), compared with the United States at 20.3 percent (and 38 percent in Finland, 31 percent in Norway, and 28 percent in Denmark). 

So, higher taxes and everyone benefits. But does this mean that the wealthy are soaked?

There are, of course, variations in incomes in Sweden, and there is the opportunity to become wealthy – for example, Stefan Persson, chairman of H&M, is listed by Forbes as the 16th richest person in the world. A doctor might earn twice as much as a teacher and pay more taxes, but is ultimately wealthier than the teacher.

Nope. Are corporations flourishing?

All the creative output flourishing here tests assumptions about the ability of capitalism to thrive under big government. Sweden, Norway, Denmark, Finland, and Iceland, with a collective 26 million inhabitants, don’t just produce successful companies. They have a creative capacity that transcends language and cultural barriers to fascinate, humor, and entertain global markets. Think Ylvis, the Norwegian comedy duo and their viral YouTube hit “What Does the Fox Say?” Or “Nordic Noir” crime fiction like Denmark’s TV series “The Killing,” and the Swedish Stieg Larsson book and movie franchise that started with “The Girl with the Dragon Tattoo.” Or Icelandic singer-songwriter Bj√∂rk. 

And these countries have pioneered public policies, the effects of which – if not the tax burden – are the envy of the common man worldwide: from universal preschool and paternity leave to vocational training schools and voucher programs for private schools. 


In looking at this article, I have to wonder what all hysteria is about in this country when we talk about "big" government. Why can't this work here? The answers to this question seem to be rooted in fear of the unknown and that timeless fault of purely selfish greed. There is a prevailing sense in this country that's what mine is mine and fuck you if you try to take the fruits of my hard earned labors. Setting aside the idea that they are even hard earned in the first place, what kind of a country do these people want to live in? One with gated communities where the most successful businesses are either dollar stores or luxury good suppliers? Or one as described in this piece?

The first step we need to take is to torpedo the idea that governmental structures that we see in Nordic countries could never work here. Why? It pisses me off that we're getting our ass kicked in the quality of life department by the likes of Sweden, Iceland, and Finland. We can do much, much better.  Of course, getting past this step requires that we stop listening to the right and deprogram the willful ignorants inside of the cult bubble.

This is the raison d'etre of this site. 

Monday, December 12, 2011


My main source of news, The Christian Science Monitor, recently posted a wonderful summation of the EuroZone economic crisis. As is often the case with the CSM, their analysis is thoughtful and well balanced. Let's take a look at the five graphics they provided. First we have the shadow economy graphic.
When nearly a quarter of your economy is untaxed (as is the case with Greece and Italy), you're going to have problems. Couple this with all the tax evasion that goes on in Greece, for example, and it's both a revenue and spending problem. Next up we have the export issue.

Germany is obviously the behemoth here. Greece is the lowest which is another explanation as to why they are in so much trouble. They aren't selling anything in the global marketplace. To put it simply, they aren't competing. Of course, we also have the issue of public sector size.

And the issue of deficit spending as a percentage of GDP.

Note here the stability of Germany. Finally, we have the main thing that the right in this country focuses on nearly to a fault.

My main point in showing all of these graphics is to stress that it is the summation of all five of these issues (plus interest rates, of course) that is causing the problem. To say that it's simply an issue of spending is ridiculous. Germany, for example has fairly high debt as percentage of GDP but their deficit spending is low and their exports are high. Their shadow economy is much lower as well.

So, it's the whole meal and not just the salad.