Nordic countries combine strong government and individual freedom

In the United States, over the past decades, we have experienced growing income inequality and the undermining of our once stable middle class. Because our winner-take-all form of capitalism has been so destructive, and so corrupting of our politicians and our government, it may be time to explore other options. The more humane and economically successful capitalist models found in the Nordic countries—Finland, Norway, Iceland, Denmark and Sweden—could be a viable alternative to what we have now.

In the World Economic Forum’s global competitiveness index, the Nordic countries are almost always found at or near the top. The  Organization for Economic Co-operation and Development’s (OECD) Better Life Index, which takes into account broader indicators such as income, environment, health, jobs, work/life balance, community, and life satisfaction, ranks the Nordic countries among the top ten “happiest” countries. So what are they doing right?

Are the Nordic countries socialist?

I’ve often thought of the Nordic countries as some kind of hybrid of socialism and capitalism, but, it turns out, they are not particularly leftist or interested in socializing their economies. Their reality is more complicated. According to a World Economic Forum publication, a combination of extreme individualism, a strong welfare state, adherence to the rule of law, low levels of corruption, gender equality, and broad social trust have shaped the successful market economies of Northern Europe.

Another publication “The Nordic Model” lists additional attributes:

▪  An elaborate social safety net in addition to free education and universal healthcare.

▪  Strong property rights, contract enforcement, and overall ease of doing business.

▪  Public pension schemes.

▪  Low barriers to free trade.

▪  Little product market regulation.

▪  High degrees of labour union membership.

▪  Overall tax burden among the world’s highest.

Unlike Americans who have been indoctrinated by the right to see government as “the problem,” the Nordic cultures embrace a strong government. For them, its main purpose is to ensure equality for every individual. The Nordics have a strong sense of social solidarity and yet, paradoxically, they have what Americans might view as a radical concept of individual freedom. Although they have strong welfare states, they are not collectivists. The state exists to serve and support the individual, not the other way around.

In an article titled “Social trust and radical individualism,” authors Henrik Berggren and lars Trägårdh write about the intense and unique individualism in Nordic cultures:

This emphasis on social solidarity hides the strong, not to say extreme, individualism that defines social relations and political institutions in the Nordic countries. Indeed, it is precisely the fundamental harmony between the Nordic social contract and the basic principles of the market–that the basic unit of society is the individual and a central purpose of policy should be to maximize individual autonomy and social mobility–that we see as the key to the vitality of Nordic capitalism.

The authors attribute their culture’s economic and social success to emancipation from the heavy-handed control of the patriarchal family and traditional religion.

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