“Nordic Model” horribly misunderstood

Does Scandinavia want Scotland, asked a BBC Radio 4 programme recently. Not really, was the frank response. But it was taken for granted that Scotland wants Scandinavia!

Scandinavia has long been admired for its “model” (what is perceived to be its socio-economic model); but “Scandimania” (to use the name of another current TV series in the British Isles) has been further enhanced by its growing cultural reach through novels and series such as “The Killing” and “Borgen”.

For those on the Left in particular (everywhere; but particularly currently in Scotland where the independence case is centred on the notion that Scotland is fundamentally more left-wing than England), the “Nordic Model” is highly tempting. It suggests that socialism can be combined with liberalism to produce a standard of living arguably unparalleled anywhere.

However, to get the right answers you need to ask the right questions. What, in practice, is the “Nordic Model”? Is it really desirable? Most of all, is it replicable?

The “Nordic Model” is presented, particularly by outsiders (who tend to be on the Left), as a high-tax and thus high-public-spending society complete as a consequence with a generous welfare system and high levels of spending on healthcare and education. Up to a point, this is true – in the industrial world, Denmark and Sweden in particular are notable for their high taxes, specifically high profit and income taxes (some around double those in the British Isles).

However, there is rather more to it than that. Strong property rights and the expectation that citizens will participate in the workforce are often ignored by foreign proponents; as is the focus on family (which leads to enviable care spending both on children and older people). Although some areas of business are highly regulated, the market itself isn’t – something which is more Liberal than Socialist. Also, public services are by no means always provided by the public sector – notably in Denmark, where even the Ambulance Service is privatised.

Also, there are practical out workings, some of which are not emphasised. As a consequence of high taxes, it is arguably easier for smaller businesses to become established (as high taxes and consequential high tax regulation level the playing field); but as a consequence of that, a national minimum wage would be impractical. Instead, wage levels are negotiated by vocation – Unions are big but moderate. Another consequence, arguably, is that property booms (and indeed property ownership generally) become much less likely, and property prices themselves remain low. On the other hand, the lower premium on property also means that Scandinavians typically live in smaller homes – it is much more common, for example, for two children to share the same room until into their teens. But then that means that children cannot wait to leave home. Grown-ups living with parents beyond age 20 is almost unknown across Scandinavia – but they tend to end up in rented flats rather than mortgaged houses. High taxes mean higher prices in the shops (but not on property – thus the overall cost of living is probably roughly even with comparable countries for those living in Scandinavia; it is much higher for those visiting), which in turn limits consumerism, and in turn means out-of-town shopping centres and such like are very unusual.

It is noteworthy also that the system has had a limited lifespan thus far. Will it work for a century or more? Possibly not – some trends, notably on growing inequality, are going the wrong way. Integration of large numbers of immigrants within the system – some who may not share the assumptions of those used to it – is proving challenging (and each country is going about it in very different ways).

Is this actually desirable, therefore? It is a completely different way of life from that in the British Isles. On the positive, probably, less money is spent on property, smaller businesses have a real chance, and society is in general more equitable. On the negative, there are fewer options in shops and restaurants, living accommodation can be more cramped, and prices for goods are extremely high. If you are used to that, it probably works quite well. But we’re not! Indeed, serious questions have been asked about whether it is really desirable in Scandinavia itself. For example, the British Left won’t mention too often that, in the past generation, public spending has been slashed by a third in Sweden and hire-and-fire has been implemented in Denmark. Also, the specifically Nordic way of life is perceived to be under threat from globalisation by some – hence anti-immigration movements now hold, have held or are about to hold the balance of power in all of Denmark, Norway, Sweden and Finland. Is all that desirable?!

Definitely Western Europe’s lowest life expectancy (Denmark; though Scotland’s taken alone is lower still); Europe’s highest murder rate (Finland); Europe’s sickliest workforce (Norway); and a European country to have lost both its Prime Minister and Foreign Minister to assassination within the last 30 years (Sweden) would demonstrate that it’s not all desirable. Of course Denmark and Norway paint themselves as green countries reliant on renewables – all while being Europe’s leading exporters of fossil fuels; Sweden paints itself as neutral while being a leading arms exporter. Desirable hypocrisy?!

Even if this is still largely desirable – and, even while not of the Left, I must say I still find it tempting on my thankfully frequent visits to these wonderful countries – the real question is whether it could be replicated in any part of the British Isles. There, the answer is comprehensively “no”!

The “Nordic Model” is misunderstood because it is perceived to be a socio-economic model. But actually it is a cultural model. It is underpinned by Lutheranism, and the basic sense of social responsibility which that brings. When the vote was given to landowners in 1832 in the British Isles, that enfranchised just 5%; in Norway in 1815 a similar law enfranchised 45%. The Nordic countries were already instinctively more equitable and more responsible to each other (while arguably as a consequence being less individualistic and innovative). As a result, the whole relationship with the “State” is perceived differently – in Scandinavia, broadly, the State is trusted, politicians are held in reasonable regard and the tax authorities are seen as being there to help you make your contribution; in the British Isles, the State is mistrusted, politicians are viewed with cynicism if not contempt and the tax authorities are seen as being there to catch you out (which is still an improvement on the way they are seen in the United States). As a consequence of this cultural heritage, anyone visiting the Nordic Countries will notice immediately that they are just more tranquil places; people go about their business more calmly; if anything, the worst thing about them is that life is so stable it can become tedious!

The “Nordic Model” wasn’t designed by any one person in particular and, insofar as it was (in Sweden), it was on the back of motivations at odds from those which exist in the contemporary British Isles (though admittedly not that far from Beveridge – a Liberal). It is like any social model a consequence of the culture and heritage of the countries in which it applies. It is hugely admirable, almost inspirational; but then it’s worth noting that most Scandinavians would say the same about the British Isles! We admire each other’s social and economic models because they (and indeed we) are so different – and yet so often complementary.


7 thoughts on ““Nordic Model” horribly misunderstood

  1. Welding man says:

    What about Iceland. It’s super amazing because it has green energy and put its bankers in jail. We should just be like Iceland.

  2. […] of course, as again Ian has noted, is a far more communitarian society than ours. But the question could be raised in our is case is: […]

  3. Paperwork Dan says:

    “I’ve never been to Iceland so can’t comment.

    Sounds a great place, though not without its challenges.”

    Are you actually telling me that a country that stuck two fingers up to the global financial system is a ‘great place’?

  4. […] prime reasons. First, as I have written many times before on this blog, the “left” has funny ideas about Scandinavia, with its huge private-sector public service provision (even the ambulances are privatised in […]

  5. Aw, this was an extremely good post. Finding the time and actual effort
    to generate a top notch article… but what can I say… I hesitate a lot and don’t seem to get nearly anything done.

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