And it kind of miffs me because not only are they socialist, but they have been working a full 25% less per year than their US counterparts. They're working a paltry 1400 hours per year whilst we slave away here in the US for almost 1900 hours, yet they STILL ENJOY THE SAME STANDARDS OF LIVING!
How is this possible?
Well I know how they do it, but I'm curious to see if any aspiring economists out there do.
I'm also half tempted to pay for an aspiring economist to come up with a chart the demonstrates what I'm thinking.
I give. How do they do it?
ReplyDelete(I've speculated about it here and here.)
Take oil out of the equation and what do you get?
ReplyDeleteNorway's total taxation as a % of GDP 40.3%, whereas the U.S. is 29%. The % of people below the poverty line (by which measurement I'm not sure) is substatially less. Thus, you have a much more even income distribution per capita.
ReplyDeleteNationmaster appears to be struggling today so I won't email the graphs.
I have no comment at this time.
ReplyDeleteOne word: oil.
ReplyDeleteBut, beyond that, state monopolized oil. They're keeping up only because they have hydrocarbon crack, with that nifty little leap circa 2000 telling all.
It's a fun party until the punch bowl is empty. That's going to be one nasty hangover, too.
oil?
ReplyDeleteI bet they can do it because of their oil!! I'd hate to see what happens to Norway when that oil runs out.
ReplyDeleteOf course it could also be that socialism really is a better way to economic growth. (Come on laugh, it was a good joke)
Yes, now if somebody can show me that with a chart, I'll concoct some sort of prize. I have a very specific measure in mind and already created the chart.
ReplyDeleteJTapp wants to know what happens if you take Oil out of the equation?
ReplyDeleteWell, they export about 1.26Billion bbls annually, according to the latest world factbook data from the CIA.
At current prices, that's about 80 Billion, annually, or about 1/3 of their annual GDP.
Suddenly, it's not so rosy of a picture, is it?
Brandon: that fund the Norwegs are diverting funds into, what is it, exactly? Fiat currency, or something more solid?
ReplyDeleteI need to find something better than my "hangover" reference. Those smug people (based on my encounters with Norwegs around my university... noses in the air, ye gods) are due for something of biblical proportions in that department.
Wait... never mind about my last question. I found a wikipedia article on the Norweg oil fund. They're trying to go the SRI (socially responsible investing) route. They're toast.
ReplyDeleteJust show them what Norway's GDP per capita would be without oil.
ReplyDeleteWould be no different than Sweden or Finland.
Hate to be the voice of dissent, but it seems to me that natural resources alone aren't enough to make a country affluent. Russia, China and much of Africa have good natural resources, but because of bad government they have had difficulty achieving economic success. Switzerland, on the other hand, has limited natural resources but is governed reasonably well, and its per capita GDP is among the highest in the world.
ReplyDeleteWhile oil is no doubt a factor in Norway's economic success, a proper analysis ought to look at least a little at what the Norwegian government is doing. I recently read the book "Eat the Rich" by P.J. O'Rourke, in which he attempts to understand the way Sweden's government works and comes up with a number of suggestions as to why Sweden has had a fair bit of success with socialism. Sweden had a fairly capitalistic society for much of the 1800s and the early part of the 20th century, up until the socialists came to power in the 1930s, and even after the socialists were in power, they were fairly slow in implementing socialist policies, so it's possible that Sweden is still coasting from the capitalistic momentum it built up before the socialists came in and started damping that momentum. Also, Sweden is starting to rely pretty heavily on debt to finance its social programs, so the socialist paradise may soon go bankrupt.
I tried looking around the Internet for information regarding Norwegian government debt, but was unable to find anything indicating that debt is a problem for them. Anyone else know anything about Norway's history or politics?
Hey Andrew,
ReplyDeleteYes, you're right. Many countries have had the insane ability to fail to exploit their natural resources.
I think it is O;Rourke's book that says soemthign like;
"Something from nothing; Hong kong"
"Nothing from Everything; Tanzania"
But I don't think that would make Norway better than say Sweden or the US in managing their resources in that our institutions are not rife with corruption.
Secondly you mention how Norway switched the to socialist model in the 1930's. And I recall a friend of mine quoting Milton Friedman;
"A Finlander came up to Milton Friedman and said, "you know in Finland we don't have any poverty."
Milton Friedman then said, "that's funny, because here in the US there is no poverty among Finnish people."
In otherwords it's the culture, the people that will dictate their poverty/relative economic success.
It's a thought process/theory I've been having recently, that if you have a moral, upstanding people, a certain level of socialism might be possible to achieve in the short/medium term without disasterous results.
In otherwords, I can see a people like the Swiss be "mature" (for lack of a better word) enough to handle socialism. Whereas if you gave socialism to the relatively moronic American youth and culture, they'd use it as a crutch or use the welfare check to buy an X-Box.
Anyway, talk to Mahan about the history of Norway. He posts semi-regularly here.
I think Norway is well on its way
ReplyDeleteto deversify from oil and is getting into green energy and
fishing and alot of other things.
Capitalism will always be our
way no matter how bad it gets
for the bottom 50%. I am just tired
of us saying how rich and great we
are when our standard of living
is suspect and our quality of enjoyment in life is 1900 hours
and growing worse. I think most
people would rather have 5 weeks
vacation, 43 weeks paid to have
a baby and medical coverage than
work two jobs at $8 an hour. I have
been to norway and its beautiful
and friendly and safe.anyway they
only have a few million people much
easier to get concensus.
Todd
A very late comment, but...for many years, Norway has been notable among governments both socialist and capitalist, for sothething rare. Spending less than they earn!
ReplyDeleteCould that have some kind of long-term economic benefit? Nahhh....