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View Full Version : The Swedish Model - maybe different than you think



David G
04-26-2012, 11:21 AM
A recent article from Robert J. Samuelson:

http://www.washingtonpost.com/opinions/the-swedish-model/2012/04/25/gIQA3rvvgT_story.html


To many Americans, Sweden is a bloated, inefficient welfare state. But the reality and the stereotype don’t match.

Look at the record.

Sweden’s job growth (as a percentage) rivals Germany’s since 2006; present unemployment at 7.5 percent is low among advanced economies; inflation averages about 2 percent; economic growth in the past five years slightly exceeds Germany’s; and government debt as a share of the economy is lower than Germany’s, according to a detailed presentation this week from Anders Borg (http://www.iie.com/events/event_detail.cfm?EventID=222), Sweden’s finance minister, at the Peterson Institute for International Economics in Washington.


What’s intriguing is that Sweden suffered its own economic crisis in 1992 (http://www.washingtonpost.com/business/economy/five-economic-lessons-from-sweden-the-rock-star-of-the-recovery/2011/06/21/AGyuJ3iH_story.html) — and its response will please and discomfort American liberals and conservatives alike.

Paul Pless
04-26-2012, 11:30 AM
Too bad that a 'balance' in the US isn't possible, considering the degree of political divisions.yeah. . . .'the left' sucks at compromise:D

Jim Mahan
04-26-2012, 11:37 AM
Only because they try to do it with 'the right'...

Nicholas Scheuer
04-26-2012, 11:48 AM
And Norwegians like being independant from Sweden.

ChrisBen
04-26-2012, 11:51 AM
The Swedish Model - maybe different than you think

You got that right. :d

http://s2.hubimg.com/u/1253169_f520.jpg

BrianW
04-26-2012, 12:06 PM
To many Americans, Sweden is a bloated, inefficient welfare state...

I always question opening lines like that one. It's very subject to interpretation.

Did the author have a nice article, and need a problem? Or is there really a problem, that needed to be addressed in an article? ;)

Dan McCosh
04-26-2012, 02:12 PM
Sweden, IMO, has always been financially conservative and socially liberal. The former has been understood mainly by industrialists and bankers.

genglandoh
04-26-2012, 02:24 PM
Yes we can learn from Sweden.

1. They balanced their budget
2. They lowered the income tax rate.
3. They increase the number of people paying income taxes
4. They reduced the power of Unions on wages.
5. They deregulated banking, air travel, telecommunications and electricity production industries.
6. They are not on the Euro
7. They have a national dept of 38% of GDP.

Yes we should follow Sweden.

Captain Intrepid
04-26-2012, 03:15 PM
Yes we can learn from Sweden.

1. They balanced their budget
2. They lowered the income tax rate.
3. They increase the number of people paying income taxes
4. They reduced the power of Unions on wages.
5. They deregulated banking, air travel, telecommunications and electricity production industries.
6. They are not on the Euro
7. They have a national dept of 38% of GDP.

Yes we should follow Sweden.

Their average income tax rate is also 57%. Sounds good to me!

Dan McCosh
04-26-2012, 03:17 PM
How about a national industrial board that reviews major corporate investments for their impact on society?

David G
04-26-2012, 05:12 PM
Yes we can learn from Sweden.

1. They balanced their budget
2. They lowered the income tax rate.
3. They increase the number of people paying income taxes
4. They reduced the power of Unions on wages.
5. They deregulated banking, air travel, telecommunications and electricity production industries.
6. They are not on the Euro
7. They have a national dept of 38% of GDP.

Yes we should follow Sweden.

I post a story about how success was achieved by being non-ideological... and this is what you make of it?

This sort of simple-minded slant is why I no longer pay much attention to your posts, other than for entertainment value. Have you considered asking bobbys if he'll let you take over the ClassClown role? He seems to be discarding it in favor of more serious commentary.

genglandoh
04-26-2012, 05:34 PM
I post a story about how success was achieved by being non-ideological... and this is what you make of it?

This sort of simple-minded slant is why I no longer pay much attention to your posts, other than for entertainment value. Have you considered asking bobbys if he'll let you take over the ClassClown role? He seems to be discarding it in favor of more serious commentary.

I do not understand your complaint.
I just read the story you posted and created my bullet points as a summary.

Here are my bullet points with the supporting quote from the story you posted.
1. They balanced their budget
“Low inflation and balanced budgets became broadly embraced popular goals.”

2. They lowered the income tax rate.
3. They increase the number of people paying income taxes
“Sweden’s income tax base was broadened and tax rates were sharply reduced. (In 1996, the average marginal rate — the rate on the last bit of income — was 46 percent; in 2010, it was 33 percent.)”

4. They reduced the power of Unions on wages.
“Union power over wages was reduced.”

5. They deregulated banking, air travel, telecommunications and electricity production industries.
“Many markets (banking, air travel, telecommunications, electricity production) were deregulated.”

6. They are not on the Euro
“Sweden could offset the depressing effects of its domestic policies by exporting more — and that’s what happened, aided by a huge devaluation of its currency, the krona.”

7. They have a national dept of 38% of GDP.
This is the only item I did not get from the story you posted but I thought it was worth adding.
http://en.wikipedia.org/wiki/Economy_of_the_European_Union

David G
04-26-2012, 06:05 PM
If you are being honest, and you truly are clueless about your own slanted summary... then you are a living, breathing example of the lack of reading comprehension engendered by Confirmation Bias.

Cuyahoga Chuck
04-26-2012, 06:14 PM
yeah. . . .'the left' sucks at compromise:D

Being sissies we weren't inclined to hand over the pound of flesh.

Cuyahoga Chuck
04-26-2012, 06:22 PM
I do not understand your complaint.
I just read the story you posted and created my bullet points as a summary.

Here are my bullet points with the supporting quote from the story you posted.
1. They balanced their budget
“Low inflation and balanced budgets became broadly embraced popular goals.”

2. They lowered the income tax rate.
3. They increase the number of people paying income taxes
“Sweden’s income tax base was broadened and tax rates were sharply reduced. (In 1996, the average marginal rate — the rate on the last bit of income — was 46 percent; in 2010, it was 33 percent.)”

4. They reduced the power of Unions on wages.
“Union power over wages was reduced.”

5. They deregulated banking, air travel, telecommunications and electricity production industries.
“Many markets (banking, air travel, telecommunications, electricity production) were deregulated.”

6. They are not on the Euro
“Sweden could offset the depressing effects of its domestic policies by exporting more — and that’s what happened, aided by a huge devaluation of its currency, the krona.”

7. They have a national dept of 38% of GDP.
This is the only item I did not get from the story you posted but I thought it was worth adding.
http://en.wikipedia.org/wiki/Economy_of_the_European_Union

If you are the engineer you say you are you certainly put a lot of importance on undefined terms like "lowered, "reduced" and "deregulated". There is certainly no evidence that they have embraced the libertarian, small government ideal that you on the right espouse in America. They have a sought a blance between austerity and socialial welfare. It's not hard to understand if you avoid letting your guts tell your head what to think.

Dave Wright
04-26-2012, 06:38 PM
The article mentioned at the bottom of Samuelson's piece is pretty good too I think, particularly with respect to aggressive central bank policies:

http://www.washingtonpost.com/business/economy/five-economic-lessons-from-sweden-the-rock-star-of-the-recovery/2011/06/21/AGyuJ3iH_story.html

genglandoh
04-26-2012, 07:13 PM
Their average income tax rate is also 57%. Sounds good to me!

Where did you get the 57% number from?

According to the story posted they top rate is 33%.

"In 1996, the average marginal rate — the rate on the last bit of income — was 46 percent; in 2010, it was 33 percent."

David G
04-26-2012, 07:41 PM
Where did you get the 57% number from?

According to the story posted they top rate is 33%.

"In 1996, the average marginal rate — the rate on the last bit of income — was 46 percent; in 2010, it was 33 percent."

Feel free to correct this number if you think it's wrong (and it may be).

However... you're not addressing the various people who have critiqued your summary of the article. Do you intend to?

genglandoh
04-26-2012, 07:46 PM
Feel free to correct this number if you think it's wrong (and it may be).

However... you're not addressing the various people who have critiqued your summary of the article. Do you intend to?

I already explained where I got my list from just because you can not understand my response does not mean I did not respond.

BrianW
04-26-2012, 07:48 PM
You make it sound as if you didn't bother to read it. I think the article was clear and fairly objective, myself.

No where in the article does it discuss the number of Americans who think Sweden is a bloated, inefficient welfare state. That sentence could just have well been left out, and the article would stand on it's own.

It's "gotcha" journalism. You chose to quote the article starting with that sentence, even though it was the last sentence in the first paragraph. Clearly putting your spin on the article.

Like I said... when someone opens with a line like that, it makes me wonder what's really going on.

bobbys
04-26-2012, 07:49 PM
Feel free to correct this number if you think it's wrong (and it may be).

However... you're not addressing the various people who have critiqued your summary of the article. Do you intend to?.

Im not coming into this thread if your going to Lawyer up! LOL

David G
04-26-2012, 07:59 PM
I already explained where I got my list from just because you can not understand my response does not mean I did not respond.

No... it means your response was inadequate. Several people pointed out the manner in which it was inadequate. You have not responded to that critique. Are you saying you're done... that's all you've got?

Meli
04-26-2012, 08:02 PM
I think that as soon as americans hear "tax rate" 50% they switch off, (as do most Australians)

This is dumb.

If you had the choice of 2 new cars, one at $15,000 and another at 30,000.
but the 30,000 model came with air bags, air con, safty features, anti brack locking systems, came with a 10 year warrantee and had 50% better fuel economy, which would you buy?
http://upload.wikimedia.org/wikipedia/commons/3/36/Income_Taxes_By_Country.svg

David G
04-26-2012, 08:06 PM
No where in the article does it discuss the number of Americans who think Sweden is a bloated, inefficient welfare state. That sentence could just have well been left out, and the article would stand on it's own.

It's "gotcha" journalism. You chose to quote the article starting with that sentence, even though it was the last sentence in the first paragraph. Clearly putting your spin on the article.

Like I said... when someone opens with a line like that, it makes me wonder what's really going on.

Actually... it was me that snipped that quote. Clearly the author thought it was accurate, but I just thought it was a good lead-in to the meat of the quote.... not all that consequential in and of itself.

You clearly object to the use of the stereotype. Are you saying it isn't all that accurate? Or are you saying the placement at the beginning of my quote was predjucical, or rubbed you the wrong way? I'm not seeing how it was all that important a bit of the whole.

bobbys
04-26-2012, 08:10 PM
DavidG is really worked up on this.

I better agree with him till he cools offLOL

johnw
04-26-2012, 08:19 PM
Where did you get the 57% number from?

According to the story posted they top rate is 33%.

"In 1996, the average marginal rate — the rate on the last bit of income — was 46 percent; in 2010, it was 33 percent."

From wikipedia:


Since the late 1960s, Sweden has had the highest tax quota (as percentage of GDP) in the industrialised world, although today the gap has narrowed and Denmark has surpassed Sweden as the most heavily taxed country among developed countries. Sweden has a two step progressive tax (http://en.wikipedia.org/wiki/Progressive_tax) scale with a municipal income tax of about 30% and an additional high-income state tax of 20–25% when a salary exceeds roughly 320,000 SEK per year. Payroll taxes (http://en.wikipedia.org/wiki/Payroll_tax) amount to 32%. In addition, a national VAT (http://en.wikipedia.org/wiki/Value_added_tax) of 25% is added to many things bought by private citizens, with the exception of food (12% VAT), transportation, and books (6% VAT). Certain items are subject to additional taxes, e.g. electricity, petrol/diesel and alcoholic beverages.

As of 2007, total tax revenue was 47.8% of GDP

It's the old problem of assuming that the income tax is the be-all and end-all.

Meli
04-26-2012, 08:28 PM
can anyone tell me why I bother looking up links for you lot?

If you look at the link, their corp tax rate is lower than the USA

ChrisBen
04-26-2012, 08:32 PM
can anyone tell me why I bother looking up links for you lot?Fer real? I gotta look up WTH "chuck a sickie" means on Google. :D

genglandoh
04-26-2012, 08:32 PM
From wikipedia:

It's the old problem of assuming that the income tax is the be-all and end-all.

I think you missed that quote was about income tax rate only not total taxes.
The quote "Their average income tax rate is also 57%."

I the story states very clearly the top rate is 33%
So the average rate must be below 33%

Meli
04-26-2012, 08:34 PM
It means take paid sick leave on debatable justification :D

ChrisBen
04-26-2012, 08:40 PM
It means take paid sick leave on debatable justification :DWell I know that now. :D Thanks to Google.

George Jung
04-26-2012, 08:46 PM
Interesting how so many are so quick to throw in a 'gotcha', rather than looking at the information exchanged, and discussing those points. Why is it everyone wants to look at these issues through partisan glasses? Playing with the idea that this forum is perhaps marginally representative of the population at large, what hope of an intelligent national conversation is there if this small sampling can't think and act smart, and manage a working dialogue?

Hell, even David G. and bobbys can't get it together.

We're doomed.

Captain Intrepid
04-26-2012, 08:51 PM
Where did you get the 57% number from?

According to the story posted they top rate is 33%.

"In 1996, the average marginal rate — the rate on the last bit of income — was 46 percent; in 2010, it was 33 percent."

Average federal income tax + average state income tax.

johnw
04-26-2012, 08:54 PM
I think you missed that quote was about income tax rate only not total taxes.
The quote "Their average income tax rate is also 57%."

I the story states very clearly the top rate is 33%
So the average rate must be below 33%


To which I reply,


It's the old problem of assuming that the income tax is the be-all and end-all.

If you look at the source for Meli's graph, Wiki tells us this:


Comparison of tax rates around the world is difficult and somewhat subjective. Tax laws (http://en.wikipedia.org/wiki/Tax_law) in most countries are extremely complex, and tax burden (http://en.wikipedia.org/wiki/Tax_burden) falls differently on different groups in each country and sub-national unit. The graph below gives an indication by rank of some raw indicators.

In making the graph, it appears that they cut the Gordian knot by not worrying about what the taxes are called, but showing what the taxes are as a percentage of income.

http://upload.wikimedia.org/wikipedia/commons/thumb/3/36/Income_Taxes_By_Country.svg/800px-Income_Taxes_By_Country.svg.png

Edited to add: I think Intrepid is more right that I am on this. Looks like they didn't count the payroll taxes, which come to more than 31%.

http://en.wikipedia.org/wiki/List_of_countries_by_tax_rates

David G
04-26-2012, 10:35 PM
Interesting how so many are so quick to throw in a 'gotcha', rather than looking at the information exchanged, and discussing those points. Why is it everyone wants to look at these issues through partisan glasses? Playing with the idea that this forum is perhaps marginally representative of the population at large, what hope of an intelligent national conversation is there if this small sampling can't think and act smart, and manage a working dialogue?

Hell, even David G. and bobbys can't get it together.

We're doomed.

Well... if HE weren't such an intractable idjit!!!

George Jung
04-26-2012, 11:03 PM
Well... if HE weren't such an intractable idjit!!!


http://t0.gstatic.com/images?q=tbn:ANd9GcTbNNBibZLZSM0NMSTo8tIsT1RKRi43N TGg_0sbh-AwlgX7aBV2


'I feel your pain'....

bobbys
04-26-2012, 11:11 PM
LOL,

Horace
04-26-2012, 11:28 PM
In making the graph, it appears that they cut the Gordian knot by not worrying about what the taxes are called, but showing what the taxes are as a percentage of income.

http://upload.wikimedia.org/wikipedia/commons/thumb/3/36/Income_Taxes_By_Country.svg/800px-Income_Taxes_By_Country.svg.png

Edited to add: I think Intrepid is more right that I am on this. Looks like they didn't count the payroll taxes, which come to more than 31%.

http://en.wikipedia.org/wiki/List_of_countries_by_tax_ratesNor are 'value added' taxes, ultimately paid by every consumer, included in the chart:

http://en.wikipedia.org/wiki/Taxation_in_Sweden

LeeG
04-27-2012, 05:11 AM
my nephew has been living in Sweden for 4yrs now. He likes it.