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Author Topic: Five economic lessons from Sweden, the rock star of the recovery  (Read 9937 times)
Jack of Diamonds
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June 28, 2011, 01:00:04 AM
 #21

ever increasing taxes to fund the paychecks of a growing state-employed & political elite. Sorry to disappoint any leftists "looking to norway and sweden", but this is just not working out at a base human level

I've dug into this subject. In the name of forced gender equality, Nordic countries are employing nearly all working age females in state-run jobs that do not necessarily produce anything of value, but full salaries are paid out from taxes  (= people who do real work in private businesses)

These include nominal desk jobs, bureaucrats, various do-nothing organizations, 'social consultants' etc.
(But also some vital jobs such as healthcare and teaching, still state-funded nonetheless)

In that sense, the American system is superior. Sure, there's the "rotten elite" who get paid for nothing. But for the average Joe (or Joanne), nope. They only get paid according to what they can do and produce.

There's no secure desk job answering a phone and filing some papers for a 20-something who finds him/herself unable to find any meaningful work in the private sector.
There's no reward for deciding you don't want to take part in work life & fund your kids life through the state and life a relatively rich life (compared to single parents or small households in other countries of the world).

It's as if, in your countries, the state is just an arbitrary substitute for a husband.

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marcus_of_augustus
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June 28, 2011, 01:40:14 AM
 #22

Quote
I've dug into this subject. In the name of forced gender equality, Nordic countries are employing nearly all working age females in state-run jobs that do not necessarily produce anything of value, but full salaries are paid out from taxes  (= people who do real work in private businesses)

Nothing scarier than blondes who earn the same as you ....

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June 28, 2011, 02:06:52 AM
 #23

Remember when Ireland was lauded for taking on the Scandinavian model?

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June 28, 2011, 04:03:58 AM
 #24

I'm from scandinavia and I really don't give a shit whether we managed to stand upright through the financial crisis or not. We're getting less free every year with increasing privacy intrusions and ever increasing taxes to fund the paychecks of a growing state-employed & political elite. Sorry to disappoint any leftists "looking to norway and sweden", but this is just not working out at a base human level. The only thing I can appreciate about living in a humongous welfare state is that going Galt is pretty damn comforting!

I have no idea what "going Galt" means. Apart from that what was mentioned in the article was that Sweden has done quite well recovering. They have done so by "meddling" in the market, which goes against the Austrian school which many here subscribe to. I found that interesting and thought I'd get some comments on that. I'm sorry you feel less free. Where would you rather be? Are there other places that you feel "work out" better at a base human level.
I suddenly realized that my rant may have been perceived as an attack on you for posting the article, which of course is not the case, thank's for posting. I'm just tired of seeing propaganda (e.g. on the UN best of lists) that the scandinavian socialism is so good, when in fact close to 80% of a typical person's income goes into taxes in some way or another, and one have to settle for whatever the government hands back to you. This way, wealth is distributed somewhat evenly; however, it's at the point of a gun, and the collectivists aren't satisfied with people's money, they want to control our lives as well with very intrusive regulations in the private sphere. The numbers usually only show statistics about material wealth – not happiness and quality of life.

Going Galt: http://en.wikipedia.org/wiki/John_Galt#Cultural_significance

Well, this pretty much settles this thread.
hugolp
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June 28, 2011, 04:42:03 AM
 #25

Quite a long answer. I'm honoured.

Why would anyone answer with a long answer to a thread were basically some nicknames have gathered together at the same time to throw some insults using a propaganda article?

Specially when I lost my time writting a critique post about Keynesianism to one of those nicknames in another thread just to discover that person has no idea about keynesianism, takes it as faith, and was not only unable to answer (which is fine, not everybody has to be an expert on economics) but decided to ignore my post and go in a nonsense rant as if he knew what he was talking about. Am I supposed to take this kind of behaviour seriously? Am I supposed to keep loosing my time?

Quote
Why do you only focus on one of the points mentioned?

Why not? Criticizing the whole thing would be a endless task. If you are willing to pay me I can write the whole critique.

Quote
But OK, let's talk about that one point.
What's so controversial about mentioning that lower rates gave households more money to spend? It generally does.

"It generally does": So basically you are acknowledging my point that it not always does.

Quote
Was it all spent? I don't know. Some of it probably was. And why wouldn't consumption help the economy?

How did consumption in housing "help" the economy in the USA, Ireland or Spain? What type of consumption has happened in Sweden? Is it sustainable or only a small bubble created by the central bank? Will the capital created by the entrepreneurs due to the signals produced by that consumption be productive in the future? Or will it be waste because that artificial consumption will desappear when the artificial conditions are not there?

Consumption is not an abstract blob of data. Consumption means that the people has consumed some specific types of products.

Quote
I don't know enough about Greenspan/Bush to address that, but feel free to enlighten me.

Greenspan kept lowering the rates at any sign of economic downturn, to "stimulate" the economy. He create the housing bubble.

Quote
I agree that the housing bubble is a problem. It's the same in Ireland afaik. There was a housing bubble in Sweden in the 1990s (google it) and from what I've read they recovered quite fast from that too.
http://www.usatoday.com/money/economy/2008-04-01-sweden-financial-crisis_N.htm
http://www.businesspundit.com/10-of-the-worlds-most-dramatic-financial-crises-and-their-lessons/
http://articles.cnn.com/2009-04-02/us/japan.sweden_1_japanese-banks-interest-rates-resona-bank?_s=PM:US
I don't recall if these were the exact articles, but I'd imagine they say pretty much the same thing.

Yes, I like a lot the example of Sweden in the 90's and how they handled their housing bubble. You know why? Because they liquidated their debt. No need for massive increase of government spending in the economy (wrongly called "stimulous"), just liquidate the debt.

Basically, the way these kind of things are solved in a free market is by letting companies go bankrupt. The debt is liquidated and the remaining assets can be realocated. But because Sweden (and any modern occidental country) has a comletely regulated banking system that allows the banks to overextend credit way beyond what the free market would allow, this solution would be very painful (quick and effective, but very painful). Therefore the government took care of the mess it had created. And honestly I have to say is one of the more responsable actions by a government I have ever seen. They basically said they would not pay for the banks debt, so basically the debtors lost it, and also liquidated the position of the shareholders. They only went in to save the money of the depositors. Once it was done they sold the banks back to private owners to recover as much money as they could.

The key here is that they liquidated the debt, so the economy could start over.

Realize that both lowering interest rates and massive government spending goes into the other way. It tries to keep the debt obligations being payed by devaluation of the currency. Its a slow default, so its a slow recovery. Liquidating the debt in a quick default allows for a quick recovery.

Also, its worth noticing that by lowering interest rates and government spending (the keynesian solution) you are helping banks and the politically connected while hurting the poor. Instead, by defaulting on the debt you are hurting the banks and the investors. This is the reason why the keynesian solution is almost always the choosen one.
hugolp
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June 28, 2011, 04:42:46 AM
 #26

I recomend to some of the poster here to stop insulting to other members of the community.

3 posts later...

This is clear. Period. Nothing to discuss here. Is typical rethoric from a cult.

Hmmm... Hard to have a low enough opinion of hypocrites like this.

Proposed Options for you, 'hugolp':

a) Cite empirical evidence published in peer-reviewed journals
b) GTFO, Bitch!

Im quoting this here so anyone can see how ridiculous you are.
cunicula
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June 28, 2011, 04:53:22 AM
 #27

You tell people not to engage in name-calling, but your arguments reduce to
a) name-calling
b) labelling information you disagree with propaganda.

Say something that can be falsified, or crawl back in your hole, [edited, no insults, this is the first warning]


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hugolp
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June 28, 2011, 04:55:36 AM
 #28

You tell people not to engage in name-calling, but your arguments reduce to
a) name-calling
b) labelling information you disagree with propaganda.

Say something that can be falsified, or crawl back in your hole, [edited, no insults, this is the first warning]

http://forum.bitcoin.org/index.php?topic=23242.msg295321#msg295321
blogospheroid
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June 28, 2011, 06:10:36 AM
 #29

Responsible behaviour,  by anyone, anywhere, is welcome. Sweden's government behaved responsibly. That is good.

In the crypto-currency world, almost all government fiat would lose value unless maintained in a very nice equilibrium with the leading currency ( I can't say that it would be bitcoin). But if a government  devalues its currency, then people will become very wary of holding that currency in the future. Swedish Kroner is surviving because the swedish accept it. If that faith is broken, who knows?

The financial crisis might not have happened in the crypto currency world because very few very large bets would have been taken on any sector.

I'm not saying that there will be no big bubbles in the future - life extension and space are two very prominent technological frontiers on which most people don't know anything.  There will be bubbles, but there may not be an extensive financial crisis.

The Script
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June 28, 2011, 06:25:29 AM
 #30

Hugolp, I agree with your posts and am on the same "team" so-to-speak, but aren't you getting a little heavy handed with your moderation here? The OP, at least, has not engaged in any sort of behavior that anyone and everyone else on this forum regularly engages in. Also, cunicula was at least partially justified in asking for specific refutations rather than hand-waving (refutation which you did provide several posts above).
caveden
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June 28, 2011, 07:48:04 AM
 #31

Iceland is a better example. Compare Iceland to the PIIGS. Iceland gave a big fuck you to the banksters while the PIIGS are taking on ever more severe austerity measures. What's the interest rate on Icelandic bonds compared to Portuguese or Irish?

Iceland is the best example of what one should do. Default on the debt and start over again.

That's only true if you mean what was done after the crisis, not what was being done before.

Although quite laissez-faire in many aspects, Iceland had an insane central bank, printing much more money than US Fed. The M1 yearly growth rate has touched 90% in 2007. The average was between 20% and 30% from 2002 to 2007. An immense increase of credit through money pumping. No wonder the crisis hit them so hard. For a more complete reading: http://mises.org/daily/3499

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smellyBobby
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June 28, 2011, 07:53:41 AM
 #32

Hugolp, I agree with your posts and am on the same "team" so-to-speak, but aren't you getting a little heavy handed with your moderation here? The OP, at least, has not engaged in any sort of behavior that anyone and everyone else on this forum regularly engages in. Also, cunicula was at least partially justified in asking for specific refutations rather than hand-waving (refutation which you did provide several posts above).

+1

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hugolp
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June 28, 2011, 10:40:28 AM
 #33

Hugolp, I agree with your posts and am on the same "team" so-to-speak, but aren't you getting a little heavy handed with your moderation here? The OP, at least, has not engaged in any sort of behavior that anyone and everyone else on this forum regularly engages in. Also, cunicula was at least partially justified in asking for specific refutations rather than hand-waving (refutation which you did provide several posts above).

I have not removed any post on this thread. Not one. The only act of moderation that I have done in this thread is to remove 1 word (only 1 word) that was an insult. The text that I have added instead of the insult is very similar to the text that I have added when removing insults in other threads. I have allowed all kind of vocabullary, like libertards and similars, I have only removed 1 direct insult.

I dont know if you are getting the impression that I have removed some post or something. I have not. I have only removed 1 word, that was an insult. Thats all. Do you still consider its heavy handed moderation?

Maybe I should post my opinions from a different account so as not to give the impression that I am bullying.
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June 28, 2011, 12:55:06 PM
 #34

Also, its worth noticing that by lowering interest rates and government spending (the keynesian solution) you are helping banks and the politically connected while hurting the poor. Instead, by defaulting on the debt you are hurting the banks and the investors. This is the reason why the keynesian solution is almost always the choosen one.

Savers and investors are two sides of the same coin... well, at least they were when banks did their job instead of playing the casino thanks to deregulation.

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hugolp
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June 28, 2011, 01:06:36 PM
 #35

Savers and investors are two sides of the same coin... well, at least they were when banks did their job instead of playing the casino thanks to deregulation.

In spite of what the oficial propaganda says, the regulation in the USA has increased in each of the last decades.
The Script
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June 29, 2011, 07:23:33 AM
 #36

I recomend to some of the poster here to stop insulting to other members of the community.

Regarding the article is a bunch of non-sequiturs. I would appreciate if the op would bring a serious economic analisys and not the economic political propaganda.

Hugolp, thanks for responding to my criticism. It boosts my opinion of you as a moderator. I agree with you that insults are counter-productive but I see people of the libertarian and anarcho-capitalism persuasion making insults and moderators don't say anything. While I disagree with the above posters, and their methods, I will defend their right to express their opinions. And I while I don't know what the word was that you deleted, it can't be any worse than the things that are normally said on the forum. However, I realize it is your prerogative as a moderator and I respect that. I just encourage you to make sure you treat everyone the same even if you disagree with them.
hugolp
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June 29, 2011, 07:50:38 AM
 #37

I recomend to some of the poster here to stop insulting to other members of the community.

Regarding the article is a bunch of non-sequiturs. I would appreciate if the op would bring a serious economic analisys and not the economic political propaganda.

Hugolp, thanks for responding to my criticism. It boosts my opinion of you as a moderator. I agree with you that insults are counter-productive but I see people of the libertarian and anarcho-capitalism persuasion making insults and moderators don't say anything. While I disagree with the above posters, and their methods, I will defend their right to express their opinions. And I while I don't know what the word was that you deleted, it can't be any worse than the things that are normally said on the forum. However, I realize it is your prerogative as a moderator and I respect that. I just encourage you to make sure you treat everyone the same even if you disagree with them.

Of course anyone can express their own opinion. I dont think there is any doubt on that.

Regarding the moderation of insults, I (or the other moderators) can not be everywhere. The forum has grown big and I can not read everything that it is posted. Insult that I see, insult I remove. That is all I can do. Keep in mind I am a volunteer, Im not getting payed for this.
The Script
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June 29, 2011, 08:00:30 AM
 #38


Hugolp, thanks for responding to my criticism. It boosts my opinion of you as a moderator. I agree with you that insults are counter-productive but I see people of the libertarian and anarcho-capitalism persuasion making insults and moderators don't say anything. While I disagree with the above posters, and their methods, I will defend their right to express their opinions. And I while I don't know what the word was that you deleted, it can't be any worse than the things that are normally said on the forum. However, I realize it is your prerogative as a moderator and I respect that. I just encourage you to make sure you treat everyone the same even if you disagree with them.

Of course anyone can express their own opinion. I dont think there is any doubt on that.

Regarding the moderation of insults, I (or the other moderators) can not be everywhere. The forum has grown big and I can not read everything that it is posted. Insult that I see, insult I remove. That is all I can do. Keep in mind I am a volunteer, Im not getting payed for this.
[/quote]

Fair enough. This is the first time I had seen an insult deleted, but I also cannot be everywhere on the forums so that doesn't mean it's the only one that has been removed. You do what you can, I do understand that. Thanks again for caring enough to respond, I appreciate it.
JA37
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June 29, 2011, 09:07:13 AM
 #39

I agree that insults are counter productive and I don't think I've ever insulted anyone on this forum. Not intentionally anyway. I might write things tongue in cheek sometimes though, which I assume some could find provocative, but the goal is never to insult.

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June 29, 2011, 09:25:50 AM
 #40

The only thing I can appreciate about living in a humongous welfare state is that going Galt is pretty damn comforting!

"Going Galt"

Seems like it would go well in  a poem with "De gale har det godt"

I'm just learning Norsk now, and I'm worthless with the poetry scheming in this language.

Hippy Anarchy
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