Book Review: “Viking Economics”

Over the past week or two I’ve been reading about the economics of Nordic countries through the studious narration of George Lakey.

Lakey’s novel, “Viking Economics”, gives us a window into the successful Social Democratic policies found in four countries (Sweden, Norway, Denmark, and Iceland), who all have historical ties to the culture of Vikings. While the US struggles to pass fundamental reforms like universal healthcare — proven effective throughout the world in a variety of countries — the Nordics are achieving full employment, effective trade adjustment assistance, and are leading the fight against climate change, all while maintaining a more prosperous and stable economy than their neoliberal counterparts.

Throughout this book you’ll see numerous references and statistics cited from hundreds of studies that help frame the robustness of these economic policies. The Nordic countries have built the type of government many liberals have always theorized was possible — one that is robustly democratic, transparent, and whose policies are guided by analytics.

One of the most interesting aspects of this book is the centrist appeal Lakey makes on these economic reforms. Not only are these policies obviously helpful for middle and working class citizens, but for a strong economy in general. Once renown laissez-fair economist Jeffrey D. Sachs saw the success of Norway, he was converted to a Social Democrat. In his own words:

“Most of the debate in the US is clouded by vested interest and by ideology. Yet there is now a rich empirical record to judge these issues scientifically.”
“On average, the Nordic countries outperform the Anglo-Saxon ones on most measures of economic performance.”
“Far from the ‘road to serfdom’, the Nordic model is the path to fairness, economic equality, and international competitiveness.”

A great deal of focus is placed on how these policies create more freedom for the Nordic people. This may be a bit confusing for many Americans. Lakey isn’t referring to civil freedom — he’s describing a freedom from economic oppression.

The Nordics believe that a well-designed economy is one that liberates the majority of citizens to consume more and produce more. If your population is living hand-to-mouth, consumption is unlikely to foster much economic growth and the average citizen is unlikely to produce any wealth beyond their own basic subsistence.

While these countries haven’t quite risen to the challenge of universal basic income yet, they cover a variety of universal, social services (not “welfare” programs, as Lakey points out) that keep the government and citizenry flexible in response to market forces. Universal healthcare, childcare, college, family leave, paid vacations, unemployment, retraining programs, and pensions for the elderly, to name a few. This paradigm is known as “flexicurity.

The investment in these programs is substantial, but so too are the rewards. Nordic countries are consistently among the top 10 happiest, healthiest, and most productive countries on earth.

Many economists will write articles in awe of the accomplishments of Nordic countries. They are utterly taken aback by the idea that Keynesian economics may be properly implemented (Even though the US was the first to see it work through the passage of the New Deal).

Of course, after they’ve praised the accomplishments of Norway or Denmark, many analysts are quick to cite some tired talking point as to why the Nordic model cannot be exported to any other country, in spite of the fact that many of their policies are now implemented in a multitude of dissimilar countries.

A homogeneous populous? Norway actually has a higher percentage of immigrants (16%) in their population than the US (13%).

Norway’s oil fund? It’s only been tapped for economic stimulus once since its conception (to the protest of many).

What about the population to wealth ratio? While the Nordics are indeed among the top 20 wealthiest countries, the US is actually wealthier than all of them, per capita.

Ultimately, this is a story about political will. Lucky for us though, it seems we are starting to get some, thanks to Bernie Sanders. With a growing movement of people, ready for progressive change in America, the Nordics are the true shining city on the hill.

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