Sweden and Greece: A Tale of Two Socialisms

A Tale of Two Socialisms

            I used to be rather intrigued by the Sweden-bashing I saw going on in the U.S.  “This President wants to impose European-style socialism on us!”  “The Democrats want to turn us into Sweden!” and so on.  Aside from the fact that it’s bloody cold, Sweden always seemed like a pretty nice place.  According to polls, the overall level of happiness is higher in Sweden than it is in the U.S.[1] The average Swede is healthier, better educated and less anxious than the average American.  And what is worse, the Swedish economy is one of the strongest in the world, having rebounded from the crash suffered by the U.S. and the E.U.[2] It accomplished this without sacrificing its weakest members, but instead providing enough of a social safety net to keep almost everyone contributing to the economy.  It did this with a mix of capitalism and socialism; by U.S. standards it is not a very free economy, but it is by any measure a free and successful nation.[3]

When I visited Sweden, what struck me most about the country was how cooperative the country is.  Major decisions (like large urban development projects) are discussed openly and, by American standards, almost interminably, with virtually everyone having a chance to make comments.  I saw a model of Stockholm’s development plans for the future reconstructed in the cultural hall, where any citizen could come in and examine it.  It wasn’t one businessman, with the connivance of a coterie of politicians, ramming through a plan designed first to make a lot of money for a few people.  Sure, there were private developers making money, but the decision to go ahead was more based on social consensus. The developers had to convince most people that these plans really were a good idea; and the people were socially engaged enough to contribute to the discussion.  As a result, the citizens were willing to pay much higher taxes to support government/private partnerships; everyone had a voice, everyone saw a point in contributing, and everyone knew that in the end, society had their back and no one would end up living on the street.  Sure, I saw evidence of the government’s control of the economy:  it is much harder for an individual to start up an independent business, and if a business gets too large it falls under the greater government regulations that can choke hiring.  But Swedes are aware of these problems and work to fine tune the system.  Overall, Sweden is a great place to live.

Today, of course, we have a much more convincing bugaboo:  Greece.  Greece seems to have done everything wrong:  massive social benefits, massive debts, and the inevitable economic collapse.  As a result, Greece is significantly lower than the U.S. on most measures of citizen well-being.[4]  The Greeks invented democracy; why can’t they make it work?

A nation’s present is, of course, shaped by its past.  Of course we live with the economic decisions of past generations, paying the debts or even reaping the dividends; but more importantly, the decisions of the past can become the values of the present, tinting the cultural filter through which we view our reality.  I could try to trace the evolution of Sweden from its Viking past, and Greece from Homer through Alexander and Rome and Byzantium, but I don’t want to write a dissertation.  Let’s just skip to the last chapter:  The Cold War and its Aftermath.  Sweden stayed out of World War II, even as its Scandinavian neighbors were engulfed by it.  In this, it seems to have been uniquely fortunate; but this uniqueness does not seem to be the primary reason for its success today.  After all, the Scandinavian nations in general top the list of “happiest countries,” and have for years.  What makes Sweden successful is that it learns from its mistakes, and makes decisions based on the welfare of the nation.  It seeks to combine the innovative and entrepreneurial power of capitalism with the social justice and stability promised by socialism.  And it is able to do this largely because the majority of citizens have a sense of ownership and pride in their nation.  The natural beauty of the land is seen as a national treasure and a source of pride for everyone; so the citizens are willing to pay a little more to manage their natural resources without destroying their environment.  The overall health of the nation is a source of pride even for those who have not set foot in a hospital since they were born; so they are willing to pay taxes to support that.  They are willing to support the arts, so that Stockholm is a beautiful mix of old treasures and new creations.  They are willing to pay three times what we would pay for gasoline, because they are proud to have such fine mass transit systems that are affordable by everyone, efficient and clean and safe, supported by the gas taxes.  When I was a child in the 1960’s, there was a word for people who would voluntarily put their own interests behind those of the nation.  They were called “patriots.”  Sometimes this was a term of derision (or pity (equivalent to “suckers”) and other times high praise.  Usually, it was praise when it came from conservatives; and in many ways Sweden is a nation of socialist conservatives, or at any rate conformists, which was generally considered the same thing in the 1960’s.

Greece, on the other hand, had a very different experience.  After WWII, it fell into civil war between Communists and the NATO-backed government, a war that was only resolved by the establishment of a pro-US military junta.  Democracy was only established in Greece in 1974, twenty-five years after the civil war ended.  There were atrocities and terror on both sides, leaving a divided nation.  It is hardly surprising, therefore, that a culture of tax evasion grew up. Many Greeks had good reason not to feel any sense of ownership in their nation.  But it is the nature of a culture that the values which arose in the past may hang on far after the original circumstances which spawned them have vanished.  It may be almost forty years since the end of the junta, but that still means that there are a lot of people who remember the days, and others who inherited those divisions and suspicions from their parents.  Greece has as much as $56 billion in unpaid taxes, as much as $1.6 billion a year, and a quarter of the Greek commerce takes place in the untaxed “shadow economy.”[5]  Even as their country faces absolute ruin, Greeks continue to shirk the basic requirements of citizenship while fighting to preserve not only the social safety net, but a gilded down-stuffed social mattress.

I think there are lessons to be learned from these two countries, both true lessons and false ones.  The first false lesson is the one that seems most likely to be drawn:  that Greece shows that socialism can’t work.  If that were true, then Sweden should be suffering the same sort of meltdown that Greece is suffering.  The Greeks problem appears to not be so much socialism itself, but a lack of true patriotism.  Swedes take pride in the accomplishments of their nation, and the vast majority of citizens are willing to shoulder some of the costs of those accomplishments.  Greeks are very proud of their culture, but clearly have little commitment to their present nation, either to support it or to fix it so they would consider it worth supporting.  They are all looking out for Number One.  In the United States, it is becoming increasingly and depressingly common for politicians to call each other “Communists” or “Fascists.”  In Greece, today, this is often not mere invective; both actual Fascists and actual, card-carrying Communists serve in the parliament.  And having actual Fascists and Communists in government doesn’t work any better than having people who only think the other side are Fascists or Communist works.  The lessons of Greece are that deficits are bad, something Dick Cheney denied when he served as Vice President, and something which the Reagan administration thought they had proven wasn’t true.  But even more, having a large portion of your citizenry who think they should not have to pay taxes is even worse.  A deficit isn’t always bad; most families in the U.S. have some level of debt.  It just means you have to agree to pay the loan back.  In an emergency, you may run a deficit; in the good times, you should pay off your debts.  We in the U.S. imitated Greece.  When Clinton left office, we had a budget surplus.  We still owed a lot of money, but we were beginning to pay down the debt.  The Republicans put a stop to paying off the debt, and instead increased it dramatically.  Now we are in a fiscal crisis brought on by our profligate ways—two unfunded wars, an unfunded Medicare drug plan, etc.—-and we are reacting just as the Greeks are:  partisan polarization.  No one wants to pay taxes, particularly the people who have more money than they can usefully invest or possibly spend.  What’s in it for me, they ask, if my nation has a truly superior health care system, or an education system that’s #1 instead of #25 our of 34 industrialized nations in math? (http://www.google.com/hostednews/afp/article/ALeqM5juGFSx9LiPaur6eO1KJAypB2ImVQ?docId=CNG.5337504e8f65acf16c57d5cac3cfe339.1c1) After all, we can always outsource our tech jobs to India, right?  True patriots would be ashamed to have such a mediocre education system, and proud to pay a few extra thousand of their billions to put us on top.  But for every one Bill Gates, there are two Koch Brothers looking to line their own pockets and the nation be damned.  And that’s fine, if they’re at least honest; but today it’s the greedy, selfish, and even the criminal and parasite who is praised as a “true patriot” because he is patriot enough to invest a few thousand dollars to contribute to politicians; the one who wants to actually improve the nation is called “socialist.”  We want to have all these things, a superior military and health care and education and airports and law courts and so on; we just don’t want to pay for them.  And as the Greeks have shown, a few decades of that will kill you.  But as the Swedes have shown, paying taxes won’t.

Sweden would seem to suggest that free markets don’t matter, as long as everyone agrees and is happy.  I think this is a false lesson, too.  Amartya Sen, the Nobel Prize winning economist, argued that democracy is good for the nation’s economy and for individual citizens.  However, he said that you need true democracy, and this has four main pillars:  the rule of law, a free and vigorous press, the right to a meaningful vote, and free markets.  If laws are perverted by corruption or status, no other rights mean anything.  If people don’t know what’s going on, the right to vote is pointless.  If they can vote, they need to be able to vote freely and those votes need to actually count, so leaders have to respond to the will of the people.  And if individuals can’t pursue their own economic interests and chart their own destinies, they will always be dependent on those who control their livelihoods.  If Sen is right, then free markets are important.  Of course, “free markets” that are dominated by one or two monopolies are no freer than state-controlled markets; Sen says there will have to be government intervention to insure real opportunities for small businesses and legal protections for individual investors.  Sweden, too, seems to recognize that the free market is important.  They want to harness the energy of individual entrepreneurs and inventors.  They know there are things the free market can do more efficiently than any state agency.  And they know that a tax code that hobbles the growth of small businesses is no good for the nation’s future.  Sweden is not purely socialist; it is a mixed economy, and as a nation it is striving to adjust the balance of public and private sector to reach the balance that will give the best life to its people.

The true lesson of Sweden, I think, is not the superiority of socialism over capitalism, even though at this moment they are doing better by almost every measure than we are.  After all, in the 1990’s they had major economic problems, too.  The lesson of Sweden is that if the national will is focused on solving problems and mutual cooperation, it is possible even for people with different interests and politics to work together to find solutions that give everyone what he or she really needs.  In the U.S. today, the notion that people should debate, talk out their disagreements, and find mutually agreeable solutions is considered treasonous; in fact, it is the only true patriotism.

 


[1]  Christopher Helman, “The World’s Happiest (and Saddest) Countries,” 12/7/2011 ( http://www.forbes.com/sites/christopherhelman/2011/12/07/the-worlds-happiest-and-saddest-countries/ ) last accessed 6/12/2012

[2] Neil Irwin, “Five Lessons from Sweden:  The Rock Star of the Recovery,” The Washington Post 6/24/2011 (http://www.washingtonpost.com/business/economy/five-economic-lessons-from-sweden-the-rock-star-of-the-recovery/2011/06/21/AGyuJ3iH_story.html) accessed 6/12/2012

[3] The Heritage Foundation, http://www.heritage.org/index/country/sweden 6/12/2012

[4]   Myweku:  All Things African, “OECDs Happiest Nations League Table; 10/13/2011 (http://www.myweku.com/2011/10/oecds-happiest-nations-league-table/) accessed 6/12/2012

[5] Carol J. Williams, “Greeks Observe Preelection Ritual of Tax Dodging;” Los Angeles Times 6/12/2012 (http://latimesblogs.latimes.com/world_now/2012/06/greeks-tax-evasion-election.html) accessed June 12, 2012

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