American progressives have long considered Scandinavia to be the apotheosis of enlightened governance and generous social-welfare programs, and thus a model for the United States. Bernie Sanders spoke for many on the left when he said, at an October 2015 Democratic presidential debate, “We should look to countries like Denmark, like Sweden and Norway, and learn from what they have accomplished for their working people.”
There are indeed lessons to be learned from those countries — just not the lessons that Sanders and other progressives have in mind. The real lessons from Scandinavia include:
- The most efficient way to finance a large welfare state is through regressive taxes on consumption.
- Government-run, universal healthcare systems tend to produce long waiting times that compel people to seek private options.
- Combining strict labor requirements with lavish welfare benefits encourages dependency and makes it harder for immigrants to assimilate.
- Mass immigration without assimilation is a recipe for social and political turmoil.
When we compare present-day Scandinavia with America, we find that Swedish and Danish economic policies have changed a great deal since the high tide of Nordic socialism in the 1970s and 1980s. We also find that America’s existing welfare state, properly measured, is more “Scandinavian” than most people realize.
All of this will be important to keep in mind as Congress and the Trump administration debate tax, health care, immigration, and other reforms in 2017 and beyond.