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NORDIC STATES - CONTENTS INTRODUCTION ......................................................................... 3 CANADA and the WORLD B A C K G R O U N D E R Volume 75, No. 6 ...........MAY 2010 NUMBERS—A variety of statistics comparing the Nordic countries with PUBLISHER............Rupert J. Taylor Canada ................................................................................................... 4 EDITORS…....Rupert J. Taylor, Linda E. Taylor THE NORDIC MODEL—The basic set-up of the Nordic welfare Canada and the World Box 22099, Westmount Postal Outlet state depends on tax-financed public provision of a large number of social ser- Waterloo, Ontario, N2L 6J7 vices. These include child care, basic and advanced education, hospital care E-Mail: canworld@sympatico.ca and health services, and care for the elderly. The core of the Nordic model is Published: Sept., Oct., Dec., Jan., Mar., May that everyone has access to these programs .................................................. 8 Single copy price: $8.95 CANADA, A NORDIC COUNTRY?—Canada and the Nordic Indexed in the Canadian Periodical Index Indexed in the Canadian Magazine countries are moving further apart on social policy .................................... 16 Index by Micromedia Ltd. Back files of Canada and the World are POLITICS—After some early hostilities, the Nordic countries have set- available in microform from: Micromedia Ltd., 20 Victoria St., Toronto, Ont., M5C tled into political harmony ...................................................................... 20 2N8 Published by R/L Taylor Publishing ECONOMICS—Classic economic theory says the Nordic way of run- Consultants Limited. ning economies should not work; yet it does .............................................. 24 Copyright© 2010 R/L Taylor Publishing Consultants Limited. COPYRIGHT INFRINGEMENT ENVIRONMENT—Pristine and well cared for? The Nordics do ap- Please be aware that unauthorized pear to be among the most conscientious custodians of the environment. But copying of the contents of this publication seriously affects the there are challenges ................................................................................. 28 livelihoods of the writers, artists, and many others who work to put it together. Such illegal copying is an Last Print Issue offence and is strictly forbidden. Written permission must be obtained from the publisher and a nominal fee This is the last print issue of Canada and the World. We plan paid before photocopying or other to continue publishing a digital version of the magazine on a reproduction of the contents is quarterly basis. It will be available only through EBSCO Pub- permitted. lishing Inc., 10 Estes Street, Ipswich, Massachusetts 01938- 0682, USA. Visit the EBSCOhost website at www.ebscohost.com Printed on recycled paper using vegetable-based inks Phone: 1-800-653-2726; e-mail: information@ebscohost.com Canada and the World no longer has a business phone or fax We acknowledge the financial support of the Government of Canada, through number, so please direct any inquiries to our e-mail: the Publications Assistance Program (PAP), toward our mailing costs. canworld@sympatico.ca Publications Mail Registration No. 09519 ISSN:1189-2102 VISIT OUR WEBSITE www.canadaandtheworld.com 2
NORDIC STATES - INTRODUCTION The First Nordics T he Saami people live across the northern cap of Europe. They have been there for upwards of 2,500 years and may be descended from an earlier cul- ture that lived along northwest- ern Europe’s coastline 8,000 to 10,000 years ago. Their ancestral homeland stretches across north- ern Norway, Sweden, Finland, and into Russia. As with Canada’s Indigenous People, the Saami lived off the land by fishing and hunting. Later, they learned to herd the The indigenous Saami people of Northern Scandinavia used to live in tipi- reindeer that supported their way like tents called lavvo, frames of which are seen here outside Tromsø, Norway. of life. They were entirely self sufficient and required nothing that anyone who wanted access their own parliaments in Nor- from outside their communities. to land in the region in which way, Sweden, and Finland, al- However, the outside came they lived had to speak Norwe- though they have few powers. into their lives anyway. In the gian. However, the Saami enjoy spe- 19th and 20th centuries, pressure The other Nordic countries cial rights in all Nordic regions built on the Saami culture. There were not so blatant in their at- In general, the Saami have were resources, such as hydro- tempts to destroy the Saami, but fared better than Canadian In- electric potential, minerals, and assimilation nevertheless weak- digenous People. Apart from the forests that the southerners ened their cultural identity. This few who still live on the land, wanted. mixing with southerners makes it they have integrated into Scandi- For the first 40 years of the difficult to give an accurate num- navian society. As everyculture.com 20th century, Norway went to ber of how many Saami there are puts it “it is more common to great lengths to stamp out the today; estimates range between see a Saami driving a Volvo than Saami way of life by insisting 30,000 and 135,000, with about to see one herding reindeer.” half of them in Norway.There FACT FILE are now only 2,800 who carry on Saami are sometimes Website the traditional reindeer-herding called Lapps, but that is a way of life. Saami Council - http://www. name imposed on them by A more enlightened view of saamicouncil.net/? outsiders and is now con- sidered offensive. the Saami began to take hold half deptid=1116 a century ago. Today, they have 3
NORDIC STATES – NUMBERS Number Crunching T he UN’s Hu- man Develop- Best Place to Live: World rankings ment Report Jane’s ranks countries UN Develop- Quality of Information Happy according to health, in- ment Report Life Index Services Planet Index come, and social condi- tions. Iceland’s high rank- 2009 2010 2008 2009 ing will probably change in Denmark 16th 16th 12th 105th 2010 when the collapse of its economy is factored in. Finland 12th 18th 29th 59th International Living is a magazine that focuses on Iceland 3rd 48th 16th 94th travel, lifestyles, invest- ment, etc. Every January it Norway 1st 12th 20th 88th publishes a “Quality of Life Index” that is created Sweden 7th 30th 2nd 53rd by measuring such ele- ments as cost of living, cli- Canada 4th 9th 23rd 89th mate, crime rates, freedom, culture, and leisure. Jane’s Information Services is a U.K.-based company that specializes in gathering data on defence sys- tems and conflicts. In 2008 it published an index of the 50 best countries from the standpoint of stability and prosperity. The Happy Planet Index (HPI) was created by the New Economics Foundation to combine human well being and environmental impact; it has little to do with wealth and more to do with life satisfaction. Costa Rica, Dominican Republic, and Jamaica fill the first three places. Government Denmark Finland Iceland Norway1 Sweden Canada Debt as % of GDP 38.5% 41.4% 95.1% 60.2% 43.2% 72.3% Current budget 5.5% 2.2% 18.0% 0% 3.4% 3.5% deficit as % of GDP Corruption2 9.5 9.6 9.7 8.9 9.2 8.4 Percentage of par- liamentary seats 38% 37% 35% 36% 43% 21% held by women 1Norway is able to balance its current budget by dipping into its oil and gas royalty fund. Canada has no such fund. 2Perception of corruption by business people and analysts; 10 means completely clean and 0 means totally corrupt. Sources: U.S. Dept. of State, national governments, Transparency International, Inter-Parliamentary Union 4
NORDIC STATES - NUMBERS Health Statistics Denmark Finland Iceland Norway Sweden Canada Life expectancy 78.3 78.9 80.7 79.9 80.9 81.2 Obesity rate 9.5% 14.9% 20.1% 9.0% 10.2% 15.4% Tobacco use 25.0% 20.6% 19.4% 22.0% 14.5% 18.4% daily smokers Alcohol 12.1 10.5 7.5 6.6 6.9 8.1 litres per capita Suicide 9.9 16.7 11.4 10.8 11.3 10.2 rate per 100,000 Sources: Organization for Economic Cooperation and Development, CIA Factbook Environment Denmark Finland Iceland Norway Sweden Canada Ecological footprint1 9.88 ha 8.45 ha 6.02 ha 6.13 ha 7.53 ha 7.66 ha Environmental per- 69.2 74.7 93.5 81.1 86.0 66.4 formance ranking2 World rank in Environmental 32nd 12th 1st 5th 4th 46th performance 1The Ecological Footprint data is created by the environment group Redefining Progress; it measures resource consumption and waste output compared to the renewable capacity of Nature. It is quoted in the number of hectares (ha) of Earth’s land surface occupied by each person’s impact on the planet. According to Redefining Progress, the planet can sustain an individual footprint of 1.89 hectares; when an individual’s footprint exceeds that size their use of resources is unsustainable. 2The 2010 Environmental Performance Index (EPI) ranks 163 countries on 25 environmental policies, where a score of 100 is the best possible. Big Mac Index: The cost of the iconic burger 1 The collapse of the Icelandic in $U.S. at exchange rates in January 2009 economy prompted McDon- ald’s to close all three of its Denmark Finland Iceland Norway Sweden Canada outlets because its food be- came too expensive. $5.07 n.a. $6.361 $5.79 $4.58 $3.36 Source: The Economist 5
NORDIC STATES - NUMBERS The Economies Denmark Finland Iceland Norway Sweden Canada GDP per capita $36,200 $34,900 $39,800 $59,300 $36,800 $38,400 GDP per capita $13,415 $10,770 n.a. $10,230 $13,495 $13,640 (1973) Growth rate 2009 -4.3% -7.6% -6.3% -1.1% -4.6% -2.4% Inflation 2009 1.3% 0% 12% 2.3% -0.5% 0.2% Labour product- -2.4% -0.3% 1.3% -1.3% -1.8% -0.6% ivity growth R&D spending as 2.4% 3.5% 2.8% 1.5% 3.8% 1.9% % of GDP Sources: OECD, CIA Factbook, economist Angus Maddison Crime War and Peace Total number Prison Military Global Murders per of crimes per population per spending as Peace In- 100,000 1,0001 100,000 % of GDP dex 20071 Denmark 0.8 92.8 77 Denmark 1.3% Third Finland 2.8 101.5 75 Finland 2.0% Sixth Iceland 1 n.a. 40 Not Iceland 0 ranked Norway 0.8 71.9 66 Norway 1.9% First Sweden 2.4 n.a. 82 Canada 1.9 75.5 107 Sweden 1.5% Seventh 1This item is included to illustrate the difficulties with statistics. On the face of it Finland appears to have ten times more crimes Canada 1.2% Eighth than Venezuela (9.3 per 1,000 people). The reality is that the fig- ures show that Finns have a better police force than Venezuelans 1 Produced by The Economist and ranking and are therefore far more likely to report crimes. countries most at peace and striving for Sources: International Centre for Policy Studies, United Nations peace Development Program, United Nations Survey of Crime Sources: CIA Factbook, The Economist 6
NORDIC STATES - NUMBERS Personal Economics Denmark Finland Iceland Norway Sweden Canada Unemployment 4.3% 8.5% 9.4% 3.2% 9.3% 8.5% rate Poverty1 2.1% 2.8% 4.2% 3.5% 2.5% 7.0% Distribution of 24 26 25 28 23 32 family income2 Social spending 28.5% 23% na 26% 32.% 18.5% as % of GDP Taxation 48.9% 43.6% 41.4% 43.4% 48.2% 33.3% as % of GDP3 1Defined as having an income 40% below national median. 2Thisindex measures the degree of inequality in the distribution of family income in a country. The lower the number the smaller the gap between rich and poor. 3Corporate and personal taxes combined. Sources: OECD, CIA Factbook, The Economist Global Warming Government Spending Per capita Cut needed Interna- Climate Education Health emissions to reach tional aid change as % of as % of of CO2 in global av- as % of world rank GDP GDP GDP tonnes erage Denmark 9.2 55.7% 116th Denmark 8.3% 8.3% 0.80 Finland 12.2 65.3% 115th Finland 6.4% 7.2% 0.39% Iceland 7.5 n.a. 1st Iceland 7.6% 9.5% na. Norway 7.9 48.9% 47th Norway 7.2% 8.4% 0.89% Sweden 5.1 21.5% 11th Sweden 7.1% 8.2% 1.03% Canada 17.4 73.7% 141st Canada 5.2% 8.8% 0.30% Sources: International Energy Agency, Environmental Sources: CIA Factbook, OECD Performance Index 7
NORDIC STATES - THE NORDIC MODEL People First The basic set-up of the Nordic welfare state depends on tax-financed public provision of a large number of social services. These include child care, basic and advanced education, hospital care and health services, and care for the elderly. The core of the Nordic model is that everyone has access to these programs V arious studies have ♦ a lot of public and/or private in the world. The World Eco- shown that Nordic spending on investment in hu- nomic Forum ranked them in the countries “succeed man capital, including child care top six nations out of 131 for better than other and education as well as research 2007-2008. They also get top countries in combining eco- and development (R&D); and, marks for innovation in a 2007 nomic efficiency and growth ♦ a set of worker protections study by the German Institute with a peaceful labour market, a that include strong labour unions for Economic Research. fair distribution of income, and and employer associations, sig- The economic theory that social cohesion. The model is nificant elements of wage coordi- most Western governments have pointed to as a source of followed for three inspiration for other decades is based on people in their search “We believe that social and labour market minimal government for a better social and policies have been important in mobilizing interference in busi- economic system.” political support in the Nordic countries ness and low taxation. Those words came Its foundation is that from the Research Insti- for openness to new technology in production, when corporations do tute of the Finnish free international trade, and competition well everybody suc- Economy (ETLA)) and in domestic markets.” ceeds. According to they are echoed by ob- this notion, the Nor- The Nordic Model, Embracing Globalization servers around the dic model doesn’t and Sharing Risks, The Research Institute world. work. In its 2007 report, of the Finnish Economy, 2007 To those puzzled The Nordic Model, ETLA by a healthy economy outlines the principal features of nation, relatively generous unem- combined with high taxes, gener- the system. They include: ployment benefits, and a promi- ous social programs, and strong ♦ a comprehensive welfare state nent role for government in pro- labour unions, ETLA says it has with an emphasis on money tecting workers’ rights and help- a lot to do with the nature of transfers to households and pub- ing people find jobs. public spending. The public licly provided social services fi- The report, which focuses on purse opens for such items as nanced by taxes, which are high Finland, Denmark, and Sweden, child care and education, infra- notably for wage income and points out that they are among structure, research, employment consumption; the most competitive countries subsidies, and job training. 8
NORDIC STATES - THE NORDIC MODEL DEVELOPMENT OF THE WELFARE STATE A strong economy and social equality is tion of wealth and power are allowed less the combined goal of Nordic welfare free play. In political terms, there is in all the states. The notion that everyone is entitled to Scandinavian countries a parliamentary de- equal access to social and health services, mocracy with close relations between the or- education, and culture is generally ac- ganizations representing the interests of both cepted. Most of the social welfare tasks in employers and employees and the political Scandinavian system. The re- countries are laxed attitude of handled by the the population state or local au- towards both thorities, and only the central gov- to a limited ex- ernment and the tent by individu- other public au- als, families, thorities is a fun- churches, or na- damental char- tional welfare or- acteristic of the ganizations. That political system.” means a broad- But, the re- based taxation port argues that system with high the system is not taxes. The bene- driven by politi- fits are generous cal ideology: and everyone is over the last entitled to them. In 2006, Sweden spent nearly four percent of GDP on century, all po- As the Royal research and development, the highest ratio in the litical parties, in- Danish Ministry of world. On average, the Nordic countries spend three cluding non- Foreign Affairs ex- percent of GDP on R&D, compared with around two socialist ones, plains, an impor- percent in the English-speaking countries. have supported tant part of the the develop- Nordic model has been the political desire to ment of the welfare state. ensure full employment since the Second “Thus, the welfare state does not represent World War. While unemployment remains a a common Social Democratic ideology, but problem, Foreign Affairs says Scandinavian a national political compromise on how to countries have the highest participation rate organize and finance the social, health, and in the world. educational benefits on which a political de- In its report on conditions of life in Den- cision has been taken to provide for the mark, it describes the Scandinavian welfare population…Consequently, a welfare system model as one that “acts within a controlled has been established which is more harmoni- capitalist market economy in which inequali- ous and in many areas more comprehensive ties in income distribution and the concentra- than in most other countries in the world.” 9
NORDIC STATES - THE NORDIC MODEL CHALLENGES TO THE NORDIC SYSTEM With all its success, the Nordic model is facing a number of challenges, particularly as a result of globalization and an aging population. Many think the system will have to be reformed to keep it running successfully T he most serious challenge to the Nor- dic welfare state is changing demo- graphics, with the baby boom generation of dic Model?), the Council says the challenge might be to find a better balance between schemes that ensure that it is always more the 1940s and 1950s entering retirement. That profitable to work than to receive benefits, will place a huge demand on social services but still provide an economic and social relating to age: not only are many in this safety net for people who face periodic un- generation retiring early, they are living employment. longer. With an aging, more ethnically diverse, It’s been estimated that and more urban population, the working-age population the Council concludes that in Finland, for example, will the welfare society needs to: decline from 66.5 percent ♦ Keep working-age people (in 2007) to 57.5 percent by employed as long as possi- 2040. Those over 65 will in- ble and reverse the trend to- crease from 16 to 26 per- ward early retirement; cent of the population, and ♦ Possibly, increase the birth those over 85 will grow from rate; and, below two to more than six ♦ Improve integration of im- percent over the same pe- migrants into the workforce, riod. and attract and keep mi- Figures are similar for Denmark and Swe- grant workers. (Some argue that low-skill mi- den. gration produces additional strains on wel- For the Nordic system to work there has to fare-state financing because such migrants be a balance between those contributing typically receive benefits that exceed what funding through taxation and those receiving they pay in taxes.) benefits. The goal of the region is not to over- The authors of The Decline of the Welfare haul the structure but to refine it in order to State (Assaf Razin and Efraim Sadka) argue compete in the global economy but main- that aging populations, migration, and glob- tain social cohesion. alization will make it impossible for the wel- According to a 2007 discussion paper by fare state to maintain itself on such a large the Nordic Council of Ministers, “It is not possi- scale. Published in 2005, the book suggests ble to retain the welfare model without hav- that these pressures will shift the balance of ing more people work, and remain working political power and lead to public support for for longer.” cutting back traditional welfare-state bene- In its report (What Lies ahead for the Nor- fits rather than expanding them. 10
NORDIC STATES - THE NORDIC MODEL “High taxes are economically harmful, but their negative ef- Between the early 1980s and 2007 the fects can be mitigated if public spending supports employment number of people over the age of 60 has and growth…” explains the grown by nearly 800,000 in Nordic study. countries; the population between The authors go on to stress 15 and 59 has increased by 1.5 the importance “of a high level million. In the next 25 years, of trust and absence of corrup- there will be an additional tion.” If the public has confi- dence the government is not 2,452,000 people over stealing or misusing its money it 60, and about will strongly support a large pub- 1,455,000 fewer be- lic sector. tween 15 and 59. The result is a society re- In Norway, for nowned for the universal nature example, popu- of its social programs, along with strong ties between welfare and lation projections labour-market policy. show that the number of people over 80 will increase by 150 percent between Employment and flexible 2003 and 2050, while the working-age population during the same period working arrangements are high, will increase by only 15 percent. as are birth rates, according to Norden, a cooperative organiza- tury Britain and its theories of grams. Typically, Nordic govern- tion for the Nordic region. The economic laissez-faire, (free- ments set aside 27 percent of very fact that women have access market capitalism). They include gross domestic product (GDP) to affordable child- and elder- Australia, Canada, Ireland, New for social programs. The average care, allows them to enter the Zealand, the U.K., and the U.S. in English-speaking countries is labour market and the political “The high-tax, high-income about 17 percent of GDP. arena to a greater degree than in states are the Nordic social de- Not surprisingly, poverty other parts of the world. And, mocracies, no- rates are lower that means they’re contributing tably Denmark, “(Economist) Friedrich in Nordic to the tax base that supports the Finland, Nor- countries and social programs that benefit way, and Swe- Von Hayek was wrong. average in- everyone. den, which In strong and vibrant come is higher. In its report, About the Nordic have been gov- democracies, a generous And still, their Welfare Model, Norden says the erned by left- government system is one of the most suc- of-center social social-welfare state is not budget sur- cessful in the rankings of rich, democratic a road to serfdom but pluses are developed economies. Gender parties for rather to fairness, econ- higher, or defi- equality, care of the elderly, much or all of cits lower, as a health centres and hospitals are the post-World omic equality, and inter- percentage of examples of areas in which the War II era.” national competitiveness.” GDP than Nordic countries have excelled. The article Scientific American, those of An- And, an article in Scientific points out that November 2006 g l o - S a x on American (November 2006) Nordic coun- countries. points out that the low-tax, high- tries have a “healthy respect for According to the Scientific income countries are mostly market forces,” but they com- American article, Nordic countries English-speaking ones. They are bine this with a strong belief in “maintain their dynamism de- linked historically with 19th cen- the need for anti-poverty pro- spite high taxation in several 11
NORDIC STATES - THE NORDIC MODEL EDUCATION E itself. ducation is a crucial part of the Nor- dic system and Finland is a model in mathematics and collected data on student, family, and institutional factors that could help to explain differences in performance. A recent report at BBC News (April 7, 2010) Not surprisingly, students from families with explained that Finnish educators believe that a more advantaged socio-economic back- everyone has something to offer and those ground were more likely to show a general who struggle in a interest in science, particular subject especially if they are given extra had a parent in a help. But, rather science-related than being placed career. in a separate class- However, the room, students with study found that difficulties receive streaming children more attention at an early age from an extra based on aca- teacher available demic ability in- in every class. creased the im- The OECD pact of socio- (Organization for economic back- Economic Coop- “We see it as the right of the child to have ground, lowering eration and Devel- daycare and preschool. It’s not a place student perform- opment) has found where you dump your child when you’re ance on average. that Finnish chil- working. It’s a place for your child to play and When the re- dren spend the learn and make friends. Good parents put port was released fewest number of their children in daycare. It’s not related to in Tokyo in April hours in the class- socio-economic class.” Eeva Penttila, head of 2007, OECD Secre- room in the devel- international relations for Helsinki’s education tary-General An- oped world. How- gel Gurría empha- department, Globe and Mail, June 2009. ever, they scored sized the impor- the highest aver- tance of educa- age results in science and reading in 2006. tion for the development of people and soci- And, they came second in math, after South ety. “Effective and innovative education poli- Korea. cies open enormous opportunities for indi- The exams, known as PISA (Program for In- viduals,” he said. “They also underpin healthy ternational Student Assessment), tested more and vibrant economies. In the highly com- than 400,000 students in 57 countries in 2006. petitive globalized economy of today, quality The focus of the report was on science but education is one of the most valuable assets the assessment also included reading and that a society and an individual can have.” 12
NORDIC STATES - THE NORDIC MODEL ways. Most important, they spend lavishly on research and development and higher educa- tion. All of them, but especially Sweden and Finland, have taken to the sweeping revolution in in- formation and communications technology and leveraged it to g ain global competitive- ness.” (see article on page 24) A United Nations study a year earlier (Social Policy and Eco- nomic Development in the Nordic Countries, 2005) also came to the conclusion that social protection and economic development can go hand in hand. According to the report, not only have Nordic countries succeeded in combin- In Finland, children don’t start primary school until age seven. It’s believed ing objectives thought to be at that they learn best from play until then, and from the age of eight months, odds with each other, the welfare state has actually played an im- all children have access to free, full-day daycare and kindergarten. In addi- portant role in economic devel- tion, primary and secondary schools are combined to avoid the potentially dis- opment. ruptive transition from one school to another. There also is a culture of read- The report explains that after ing with children at home and parents have regular contact with teachers. As World War II Nordic countries well, all primary-school teachers have master’s degrees and the profession as a tied economic and social policies whole is highly valued, as is the public school system. together. It says the plan was to ease the transition from farming unifying people, social programs everyone generally. They wrote a to industry. “Social and housing promote stability. book about it, called The Spirit policies facilitated the migration Family policy programs that Level: Why More Equal Societies Al- of agrarian labour force from the reduce poverty provide eco- most Always Do Better, published countryside to the factories in nomic security for children, cities. The lowering of income which leads to better perform- differences was seen as an im- ance in school and, later, FACT FILE portant factor of guaranteeing achievement in the labour mar- In school science test results smooth economic growth.” ket. Equality gives everyone ac- Finland was followed by So, by focusing on equity and cess to education and culture, Hong Kong-China, Can- the value of everyone’s contribu- and that improves society as a ada, Chinese Taipei, Esto- tion to society, they fostered a whole by opening up opportuni- nia, Japan, and New Zea- solid foundation of security upon ties to all. Universal health care land. Australia, the Nether- which economic development makes for a healthy as well as so- lands, Korea, Germany, the could thrive. “A social policy is phisticated population. It’s all United Kingdom, the Czech much more than just guarantee- designed to improve the well- Republic, Switzerland, Aus- ing security against various social being of individual citizens to tria, Belgium, Ireland, Liech- risks,” states the study. “Social enhance all of society. tenstein, Slovenia, and Ma- policy creates and fortifies social British social scientists, Rich- cao-China also scored bonds and may enhance the de- ard Wilkinson and Kate Pickett above OECD average. velopment of social capital.” By agree that equality is a plus for 13
NORDIC STATES - THE NORDIC MODEL QUESTIONING THE FUTURE T he Nordic Council of Minister’s Five- Several years earlier, in 2002, the Royal year Program on Welfare Research, Danish Ministry of Foreign Affairs observed which financed 15 research projects, that all the Scandinavian countries were de- wrapped up in May 2006. In its discussion pa- veloping a supplementary welfare system, per the following year, the Council raised a “giving greater benefits to those who are in number of questions on the future of the Nor- the labour market. This is a clear deviation dic welfare model. from the equality principle which is at the Will it be possible to score high on welfare, heart of the Scandinavian welfare model.” competitiveness, and innovation in the fu- The Research Institute of the Finnish Econ- ture, considering omy (ETLA) put how the global “… the present welfare arrangements originated it this way in competitive and developed in the 1960s and 1970s at a 2007 in its re- economy is time of high economic growth and low unem- port, The Nor- evolving? Should ployment. It has never been the intention either dic Model, we introduce Embracing with unemployment, sickness benefits, or with more needs Globalization, evaluations, link cash benefits that so many people should receive and Sharing welfare services them or that they should receive them for so long Risks: “With more to earned as has been the case in recent years. The financ- higher mobility entitlements, de- ing of the welfare state has thus become a prob- of labour it be- fine what the lem, and as it has not been politically possible to comes in- public sector creasingly pos- increase taxes, which are already very high, the should offer and sible to benefit Scandinavian countries have accrued a very finance, and de- from the enti- fine the responsi- large national debt which on the long view tlements with- bility of the pri- could represent a threat to the welfare systems.” out sharing the vate individual? Royal Danish Ministry of Foreign Affairs, Denmark – Con- cost (paying The Council ditions of Life – The Scandinavian Welfare Model, 2002 the taxes). also raised the “There are issue of private versus public welfare provi- many examples. Graduates from domestic sion, commenting that models in which the tax-financed universities increasingly make private and public sectors are working to- their careers (and pay their taxes) abroad. gether are being developed in several Euro- Citizens who have spent most of their working pean countries. lives (and paid their taxes) abroad, return to “Despite active political efforts in some their home country after retirement to collect Nordic countries to prevent private involve- the benefits of free (or cheap) hospital care ment, a parallel private market is evolving for and care for the elderly…With increasing welfare services...People are becoming more claims on entitlements…and eroding tax uncertain about whether they will receive bases…the long-run sustainability of the Nor- the services they need from the public sec- dic model could be in serious jeopardy.” tor, and those who can afford to do so buy But, while it needs significant reform, ETLA health insurance and private nursing and believes the core of the Nordic model should care services.” be preserved, sharing both benefits and risks. 14
NORDIC STATES - THE NORDIC MODEL in 2009. The authors provide plenty of evidence that rich PIONEERING FOR WOMEN’S RIGHTS countries where incomes are more evenly distributed have longer-lived citizens and lower rates of obesity, delinquency, de- S ome lieve foundation of the be- the pression, and teenage pregnancy Nordic welfare than richer countries where model is gender wealth is more concentrated. SUGGESTED ACTIVITIES: equality. From 1. A 2006 Scientific American 1909 until 1929 article made this comment: “The re- the Nordic coun- sults (under the Nordic model) for the tries worked to- households at the bottom of income dis- gether to reform tribution are astoundingly good, espe- marriage laws cially in contrast to the mean-spirited with gender neglect that now passes for American social policy. The U.S. spends less equality at its than almost all rich countries on social core. The project had as much to do with economics as services for the poor and disabled, and equality, because male-dominated society “had become a it gets what it pays for: the highest pov- liability to the economy,” says the Danish Centre for Infor- erty rate among the rich countries and mation on Gender, Equality, and Ethnicity. “The project was an exploding prison population. Actu- so radical that the rest of Europe did not achieve the same ally, by shunning public spending on levels of equality until the 1970s.” health, the U.S. gets much less than it pays for, because dependence on private One of the aims was to preserve the nuclear family health care has led to a ramshackle which was becoming less appealing to many women be- system that yields mediocre results at cause of its history of male dominance. In 19th century de- very high costs.” Contrast this with the mocratic Denmark, the man was still the head of the family current situation in the U.S. under with full authority over his wife’s property and income, as President Barack Obama. well as parental control. On entering marriage women had 2. The Nordic Council of Ministers to promise obedience to their husbands, and feared losing says Spain is one of the countries going furthest in evolving new models that their children in the event of a marital split. combine public and private elements. It The reforms made marriage a civil contract between two gives the example of the Swedish equal parties. health-care company Capio, which has received a 30-year contract to run the primary and specialist health service in inhabitants, but is run by a private models are created for collaboration a Madrid suburb with 130,000 in- company. The Council says a parallel with private and non-profit parties. habitants. The health service is still in the Nordic countries might be the Research how the changes are working publicly financed and available to all Swedish school system. Private schools in Spain. can provide educational services with public financing within the same frame- Website FACT FILE work as public schools. Several panel The Nordic Model - http:// The membership of the members feel that the Nordic countries Danish Women’s Society www.etla.fi/ risk using resources inefficiently, having was one-third male, around files/1892_the_nordic_mode wider social gaps, and too little quality 1900. development and innovation unless new l_complete.pdf 15
NORDIC STATES - CANADA: A NORDIC COUNTRY? A Nordic Country? Canada and the Nordic countries are moving further apart on social policy G eography makes Government systems in all by an appointed Governor- Canada a Nordic countries are similar but not General. Finland and Iceland are country. In com- identical. In all countries, every- republics with elected presidents, mon with Den- body over the age of 18 gets to although in Iceland the job is mark, Iceland, Norway, Sweden, cast a ballot in elections, but mostly ceremonial. and Finland, we all have land Canada is the only one to have a Canada is the only one of the within the Arctic Circle. first-past-the-post system of de- six to have an upper house – the (Iceland just squeaks in with ciding who wins. All the Nordic appointed Senate. The group of the tiny island of countries is secular Grimsey - 40 km with a separation north of the of church and mainland -, which state. Those few sits smack on the similarities and a Arctic Circle. Den- whole lot of ever- mark qualifies green trees just through its loose about sums up the sovereignty over ways in which Greenland.) Canada and the All these na- Nordics are alike tions are maritime today. with long coast- However, the lines in relation to countries came to their size. That be more alike al- makes fishing and most half a cen- ocean ecology tury ago. That was items of great in- a time when the terest in all capitals. All six coun- countries have proportional rep- collective good of society was tries are thinly populated resentation in which parliamen- seen as more important than in- (Denmark is an exception), tend tarians are elected based on the dividual freedom. to concentrate in a few cities, and percentage of the popular vote For 15 years from the mid- have to endure miserable their party receives. 1960s the Liberal governments weather at times. Again, except Denmark, Norway, and Swe- of Lester B. Pearson and Pierre for Denmark, the wilderness is den are constitutional monar- Elliot Trudeau enacted a series never very far away. Economi- chies where the head of state is a of social reforms. But, the proc- cally, this group of countries has hereditary monarch; the posi- ess of adopting “The Nordic relied heavily on primary indus- tions are largely ceremonial. Can- Way” (it wasn’t called that back tries such as mining, forestry, ada’s head of state is also a royal, then) began in September 1960. fishing, and agriculture. Queen Elizabeth II, represented The Liberal Party had been 16
NORDIC STATES - CANADA: A NORDIC COUNTRY? TO TAX OR NOT TO TAX P eople in Nordic countries pay more taxes than Canadians to support a more extensive package of social programs. ceived sup- port from an unlikely Almost 49 percent of the average Dane’s in- quarter. In come goes to taxes, while the average Ca- a poll of nadian pays 33 percent. 151 top The conservative argument in favour of business lower taxes is that it encourages higher levels executives of business investment. This creates more jobs (March and, with more people earning, tax revenues 2010) al- go up. m o s t Since coming to power in 2006, the Con- three servative government has lopped several out of five say some tax increases may be percentage points off corporate taxes, per- necessary if Ottawa is to balance its books. sonal income tax, and the Goods and Ser- And, there’s evidence to back the notion vices Tax. Cuts to taxes are popular with vot- that higher taxes result in a better quality of ers. life. Two York University tax law professors – When Liberal leader Stephane Dion pro- Neil Brooks and Thaddeus Hwong – com- posed putting a tax on carbon as a way of pared six Anglo-American countries including combatting climate change he was badly Canada with four Nordic nations. mauled by voters. Lawrence Martin in The In their December 2006 report they say Globe and Mail (March 11, 2010) says Liberals that “high-tax countries have been more won’t even mention tax increases now. The successful in achieving their social objectives nearest they have come is for party leader than low-tax countries. Interestingly, they Michael Ignatieff to say, after a March 2010 have done so with no economic penalty.” policy conference, that planned corporate They looked at 50 indicators, such as pov- tax cuts should be cancelled. erty, gender equality, health outcomes, etc. The Conservative Party has mocked the In 42 categories the Nordics outperformed suggestion. However, Mr. Ignatieff has re- the Anglo-American group. badly mauled in the federal elec- thinkers to the meeting to deliver sal health care (1966); Company tion of 1958. Prime Minister papers and discuss policy. From of Young Canadians (1966); Ca- John Diefenbaker’s Progressive the conference came the blue- nadian International Develop- Conservatives trounced the Lib- print for Liberal social policies. ment Agency (1968); homosexu- erals after the latter had been in Back in power in 1963, the Lib- ality was decriminalized in 1969; power for decades. Party leader erals embarked on a flurry of Status of Women Canada (1971); Lester B. Pearson set about re- left-of-centre social policies simi- Multiculturalism was made offi- building the brand and one of lar to those in Scandinavia. These cial state policy (1971); Unem- the key strategies was a confer- included: the Canada Student ployment Insurance Act ex- ence in Kingston, Ontario. Loan Program (1964); the Can- tended to cover sickness and ma- Pearson brought a lot of deep ada Pension Plan (1965); univer- ternity leave (1971); and so on. 17
NORDIC STATES - CANADA: A NORDIC COUNTRY? anced, Liberal Finance Minister and later Prime Minister Paul Martin cut taxes instead of boosting social spending. Murray Dobbin, writing for rabble.ca Swedish-born Ca- (January 20, 2006) points out nadian Gideon that starting in 2000, Martin “cut taxes by $100 billion over five Sundback, improv- years.” The effect of cuts such as ing on the work of these is to lock in the downsized others, designed the nature of social programs. Any “Separable Fas- future politician who wants to tener” in 1913; the revive the welfare state must first device later became increase taxes, and that’s a recipe known as the for electoral disaster. “zipper.” (On November 14, 2003 Paul Martin was chosen as Leader of There were other initiatives to be paid for. In 1985, the debt the Liberal Party and became that extended the activities of the reached $200 billion. In 1992, it Prime Minister of Canada. In his state into the lives of Canadi- blasted through $400 billion and acceptance speech he said: “The ans – a national labour code, it reached the half trillion mark true challenge of leadership is to government-funded crop insur- in 1994. rally a nation to its unfulfilled ance, and legal aid for those who Canada’s national debt was promise. To build a society based could not afford to hire a lawyer. now so massive that it could no on equality, not privilege; on For those on the left of the longer be ignored. Out of every duty, not entitlement. A society political spectrum these were dollar Ottawa collected from tax- based on compassion and caring; promoted as ways of helping the payers, 40 cents was going to pay not indifference or neglect.”) less fortunate in society. The just the interest on all the money Despite those noble senti- programs were to be paid for by the country had borrowed. ments, Paul Martin was now in a progressive taxation that redis- The Liberal government of Canada where the political cli- tributed income; the more you Jean Chretien started to slash mate had changed under the in- earned, the more taxes you paid. government spending. Through fluence of the United States. The Those on the right criticized the 1990s, the cherished social idea that all people had a duty to such measures as interfering with programs of Canadians began to help the less fortunate gave way the freedom of individuals to decline. It became way more dif- to the belief that each individual control their own lives. The ficult to qualify for Unemploy- should be responsible for her or growth of a “nanny state” cre- ment Insurance benefits; stu- his own welfare. Government ated huge government bureauc- dents had to pay higher tuition programs, many people came to racies and an unfair tax burden. fees at universities; hospital beds believe, were not the solution, But, the tax burden was not, were closed and wait times for they were the problem. Public in fact, high enough to pay for all treatment got longer. services could be provided more these programs and Ottawa The deal was sold to Canadi- efficiently if they were run by started to rack up some big ans as “Short term pain for long private enterprise and individuals debts. At first, nobody bothered term gain;” when the debt was could have the freedom to chose much about the debt. Most Ca- back under control, social pro- among the options. nadians loved their comprehen- grams could be ramped up again. Right-wing governments such sive social programs and politi- But, the re-investment in the as that of Stephen Harper’s Con- cians, seeking to be elected, did- public good has never happened. servatives were voted into n’t like to remind voters they had Once the budget was bal- power. The bedrock of their ide- 18
NORDIC STATES - CANADA: A NORDIC COUNTRY? ology is that the best government is the smallest one. Since Mr. Harper took over the reigns of government he has put this philosophy into action, moving Canada away from the Nordic model. On March 11, 2010, colum- nist Lawrence Martin wrote about this in The Globe and Mail: “National programs such as daycare and the Kelowna Accord on Native health and education have been scrapped. Multicultur- alism, that old Liberal fundamen- tal, is being curbed as limits to cultural tolerance are advocated. The country’s new citizenship Eighty-five percent of Swedes live in the country’s southern half; more than 80 guide has a more conservative percent of Canadians live within 200 kilometres of the Canada/U.S. border. lean.” The folks over at the Cana- thus been transformed from liberals have moved away from dian Health Coalition (CHC) guardians of the public good to their left-of-centre policies of the have spotted an erosion of Medi- boosters of private profit, from 1960s and ‘70s, a clear majority care, which is supposed to pro- seekers of social justice to de- of Canadians seems to favour a vide equal access to care and not stroyers of the welfare state.” less Nordic approach to social be for profit. In an October 2008 Mr. Finn even quotes the for- organization. report, CHC found 42 diagnostic mer Conservative Premier of Al- SUGGESTED ACTIVITY: clinics, 72 surgical hospitals, and berta, Peter Lougheed, as saying: Writing for the left-leaning Canadian 16 physicians in Canada all oper- “We are becoming increasingly Centre for Policy Alternatives ating on a for-profit basis. Americanized and this imposes (September 2008), Ed Finn asks: “Among these clinics,” said an un-Canadian individualism on “Weren’t governments originally estab- the report, “we found evidence our ethic.” lished to protect and advance collective to suspect 89 possible violations But, does it? Canadians have interests? And wasn’t such an overrid- of the Canada Health Act in five twice voted for a right-of-centre ing purpose inherently hostile to the cult provinces. These include clinics government. In 2006, the Con- of individualism? Indeed it was, and so that appear to be selling two-tier servative Party won 124 of Can- the corporate, political, media, and aca- health care and extra billing pa- ada’s 308 seats; more than any demic champions of ‘individual rights tients for medically-necessary other party but not enough for a and freedoms’ had to reverse this prime services.” The group concludes majority. In 2008, the Conserva- government mandate. They had to con- that “the federal government is tives won 143 seats, still not vert government into a mechanism for not enforcing the Canada Health enough for a majority, but show- promoting private and individual inter- Act to protect patients from in- ing an increase in popularity. ests instead.” Discuss. creasingly aggressive attempts to The latest Ekos opinion poll dismantle equal access to health (March 2010) shows the Conser- Website care for all Canadians.” vatives (33.1 percent) more Writing for the left-leaning popular than any other party. Canadian Nordic Society - Canadian Centre for Policy Al- Their nearest rival, the Liberal http://www. ternatives (September 2008), Ed Party, is the choice of 28.9 per- canadiannordicsociety.com/ Finn says, “Governments have cent of Canadians. And, as the 19
NORDIC STATES - POLITICS The Art of Cooperation After some early hostilities the Nordic countries have settled into political harmony P atching together the ing the turmoil of the Russian practice, neutrality was impossi- political history of the Revolution (1917), Finland ble. Nordic region can be a seized the opportunity to set it- In 1949, Denmark, Iceland, challenge. The bounda- self up as an independent nation and Norway threw their lot in ries among the countries that for the first time. with the Western allies by joining make up the region – Denmark, Since then, stability has more the North Atlantic Treaty Or- Finland, Iceland, Norway, and or less settled in with boundaries ganization (NATO) a mutual de- Sweden – have been fluid over and sovereignties pretty much as fence group. time. So has the sovereignty of they are today. In theory, Sweden and each nation. While most of the countries Finland remained neutral, al- In the 13th century, Finland of Europe were busy bashing though Sweden cooperated was part of Sweden and Iceland themselves to pieces in World closely with NATO. belonged to Norway. In the next War I (1914-18), the Nordics Finland was in a tough century, they all joined to- spot. Its sentiments were with gether in the Kalmar Un- the Western alliance, but it ion. When that broke up, “Even we right-wing politicians, shared a long border with the Denmark and Norway if we were in England or Canada, Soviet Union. The threat of were, effectively, a single would be seen as being very left-wing.” invasion meant that Finland nation. Swedish Liberal Party Member had to tread a careful diplo- Sweden/Finland and matic path and do nothing to of Parliament Tina Acketoft, Denmark/Norway were annoy its heavily armed then sworn enemies for quoted in The Globe and Mail, neighbour. The situation about 300 years. Several September 16, 2006. came to be known as wars were fought as the “Finlandization,” describing two sides tried to establish domi- stayed out of the fight. They the influence that one powerful nance in the region. tried to do the same in the sec- country has on the policies of a In the 19th century, a weak- ond round of warfare (1939-45) smaller neighbouring country. ened Denmark handed Norway but were not so fortunate. Ger- Today, the resentments over to Sweden. However, Swe- many occupied Denmark and caused by past squabbles are den lost control of its eastern Norway, the Allies occupied Ice- largely buried and the five na- half (mostly, what is now land and Greenland, and the tions cooperate in many areas. Finland) to Russia. Denmark also Finns got involved in a nasty In 1953, the Nordic Council gave in to Iceland’s increasing brawl with both the Soviet Un- was set up as a place where com- demand for independence and ion and Germany. However, for mon issues could be dealt with. granted it home rule in 1874. A the most part, they avoided the Initially, the group included Den- complete separation came in devastation that flattened large mark, Norway, and Sweden, with 1944, when Icelanders voted to parts of Europe. Finland and Iceland joining later. sever ties to Denmark’s monar- The Nordics tried to remain The idea was that the Council chy. neutral during the Cold War would encourage political, eco- In 1905, Sweden and Norway when Western nations squared nomic, and cultural teamwork separated peacefully. Then, dur- off against the Soviet Union. In among the five states. Some early 20
NORDIC STATES - POLITICS initiatives included the easy movement of labour, passport- TOLERANCE WEAKENING free travel, and some common legislation. But, the formation of the European Union (then called the European Economic Com- F ollowing World War II, a lot of immigrants settled in the Nordic countries. Sweden has been especially gener- ous in accepting newcomers and all have taken in substan- munity) started to overlap the tial numbers of refugees. Council’s activities. The Nordics joined a compet- Recently, problems with assimilation have cropped up, ing trading group called the with points of friction mostly focussed on Islam. The issue has European Free Trade Associa- become significant in Denmark. tion (EFTA). Founded in 1960, In 2005, a Danish newspaper published some caricatures EFTA included Denmark, Nor- of the prophet Mohammed. To Muslims it is a grave sin to way, and Sweden, along with depict Mohammed in any way. Their reaction to the car- Portugal, Austria, Switzerland, toons was to stage violent demonstrations around the world and the United Kingdom. and the trashing of two Danish embassies. Finland and Iceland came in later. The push-back was immediate and strong. Writing in The But, the European Union New York Times (February 12, 2006), Danish journalist Martin proved to be a more attractive Burcharth commented: “Not surprisingly, Islam has come to trading organization and EFTA be viewed by many as a threat to the survival of Danish cul- members began to drift into the ture.” EU. Denmark and the U.K. went But even before the Mohammed cartoon fuss, Danes in 1973. Portugal joined the EU were getting antsy about Islam. in 1986. Finally, Austria, Finland, and Sweden quit EFTA for the Burcharth quotes Denmark’s Cultural Affairs Minister Brian larger group in 1995. Mikkelsen as saying during the summer of 2005: “In Denmark Today, EFTA has four mem- we have seen the appearance of a parallel society in which bers: Iceland, Liechtenstein, minorities practice their own medieval values and undemo- Norway, and Switzerland. How- cratic views. This is the new front in our cultural war.” ever, Iceland is in talks about A few months earlier, BBC News reported that, “Queen joining the EU in 2012. The Margrethe of Denmark has spoken out against radical Islam Norwegian people have twice rejected joining the European and called on Muslim immigrants in the country to improve Union in national referendums. their Danish language skills.” With all but one Nordic state And, since it was founded in 1995, the anti-immigrant now in, or about to be in, the Danish People’s Party (DPP) has grown steadily in popularity. EU, the Nordic Council has be- In the November 2007 election, the party won 25 seats and come more of a cultural organi- the governing centre-right coalition depends on the DPP for zation; politics and economics support. are of less importance. NATO and the EU are now the forums for political and economic coop- of the NATO-led alliance.” eral, the number of seats a party eration among the Nordic na- This notion of cooperation gets is in proportion to that tions. “For example,” says the among nations characterizes the party’s share of the popular vote. Nordic Council, “all have sent domestic politics of the region. As a typical example let’s look troops or civilian personnel All Nordic countries have at Denmark’s election of No- (Iceland does not have armed proportional systems of electing vember 2007. The Liberal Party soldiers) to Afghanistan as part members of parliament. In gen- got 26.2 percent of all the votes 21
NORDIC STATES - POLITICS policy. KALMAR UNION This electoral system seems to encourage more voter partici- T he unification of nations was popular in the middle of the 19th century, and led to the creation of two new countries in 1871 – Italy and Germany. Before that date pation as citizens feel their indi- vidual vote counts. Typical turn- outs for general elections in the both countries were divided up into many separate states Nordic countries are between 80 (Germany had more than 300), some of them very tiny, and 85 percent. (Voter participa- ruled mostly by princes, dukes, and kings. tion in the 2008 Canadian elec- A similar movement for unification stirred in Scandinavia tion was 59 percent and has never exceeded 79 percent.) at the same time, based on a common Norse heritage go- All Nordic countries have ing back more than 1,000 years. There had been a previous variations on the Danish theme. unification. In 1397, the Nordic region formed the Kalmar For example Iceland puts its Union. This was dominated by Denmark, something that did- threshold for winning seats at n’t go down well with Swedes. Irritation led to fighting and five percent of the popular vote, the union broke up finally in 1536. Sweden at four percent, while The 19th century movement was called Nordism. It Finland has no threshold. started among Danish and Swedish university students and Each country restricts the was working towards regional unity under a single nation. vote to citizens, but Norway has However, in 1864 Prussia (Germany) attacked Denmark a little quirk; the King of Norway (Harald V since 1991) is not con- in a dispute of land they both claimed. Instead of rushing to sidered a citizen and is therefore Denmark’s aid, Sweden stayed out of the fight. That killed not allowed to vote in general any hopes of a grand union of three nations united into elections. one. In most proportional repre- sentation systems the parties cast and won 26.3 percent of the II since 1972, calls the leaders of publish lists of candidates based seats (46). The Social Democrats all the parties with seats to a con- on seniority. If a party wins 25 received 25.5 percent of the ference. The conference advises percent of the popular vote then votes and were given 25.7 per- the queen which party leader has the top quarter of its party list cent of the seats (45). Further the best chance of forming a gets seats. down the list the Red-Green Al- government and he or she is However, in Finland, voters liance collected 2.2 percent of given the task of putting together tend to vote for individual candi- the ballots cast and was awarded a coalition. The negotiations go dates rather than political parties. 2.3 percent of the seats (4). Par- on until a government, which Under this system people can ties must get over the threshold may be made up of several par- register dissatisfaction with a of two percent of the popular ties, is put together. party or its leadership by voting vote to win seats. This system leads to many for a junior member of the party. After an election, the coun- parties having seats, in our 2007 This means that senior party try’s monarch, Queen Margrethe example above, eight parties had members can lose their seats if representatives in the parliament. the electorate is unhappy with FACT FILE No party has won an absolute them. The Finnish system also majority in Denmark in more helps small parties with popular- “Nordism” should not be than 110 years. With many par- ity in a single region elect mem- confused with “nordicism,” ties and many points of view at bers. which is the twisted belief in the table, Danish governments However, there is usually not the racial superiority of Nor- have learned to compromise, ne- a lot to choose among the parties dic people. gotiate, and reach consensus on and their policies. For most of 22
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