Tuesday 18 October 2005

Pic of the day: They are coming for your money! Run and hide! The socialists are coming! Well, kinda.

New government in Norway

The Socialist government is up and running. Or as I like to call them (half in jest), "The Anti-American Coalition". Actually only one of the three parties is wild-eyed anti-American, namely the Socialist Left. Their frequent rants about American imperialism and their demands that Norway must leave NATO made them really hard to take seriously in the past, before George W. Bush had the chance to prove himself. They are decidedly still in minority even in the government, and the Norwegian foreign policy will largely remain the same as it has even since the end of World War II. But they are no longer regarded purely as crazy loons with no anchor in reality. Except by some of us...

A few concessions have been made to the Socialist Left in foreign policy. Norwegian troops will be withdrawn from Iraq as soon as technically feasible, at most 100 days. Norwegian troops in Afghanistan will no longer operate under American command. There will probably be some more symbolic notes in international treaties where we distance ourselves from the Americans, but then again Americans usually have their own notes these days where they distance themselves from the rest of the world.

I am happy to say that most of the damage from the Socialist government will fall on the Norwegian people itself. And even that should be moderate. The Prime Minister does have some political debts to repay to the left wing of the Labor Party and to the labor unions, but he is not stupid. He is frighteningly intelligent and well educated in economics. So why is he leading the Labor Party and heading as Socialist government, if he is not stupid? Socialism is stupid, after all. The answer is simple: His father was a high-ranking Labor politician, and the son inherited his contact network and inside knowledge of how the party organization worked. Besides, the Labor Party has been the largest in Norway for most of the post-war period, so taking it over provided a running start.

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Let me briefly recap why socialism is stupid. It assumes that the labor market does not exist, so the evil capitalist upper class will mercilessly exploit the worker underclass unless society intervenes and takes control of the means of production. It further assumes that politicians and bureaucrats are just as competent in handling business as those who have invested their own money in it. A quick reality check will show you that this has not been the case for the last few generations. Socialism has been tested, and it failed.

Now it can be argued that the Nordic countries are already fairly socialist. We have high taxes, at least compared to America, and generous welfare handouts to the losers. Despite this, we are doing quite well. The average income in Norway is higher than in the USA. The other Nordic countries are somewhat lower on that ranking, but not if you ignore the small clique of extremely rich on the top of American society. And why not ignore them in this context? It is not like ordinary people benefit in any way from the unimaginable riches hoarded by oil and tobacco billionaires. The Nordic countries have virtually no poverty, except for the few who choose to stay outside society (drug abusers and illegal immigrants mostly). Unemployment is low – again, Norway trumps the US: Not only is the unemployment low, but there are many more women who choose to work outside home.

So clearly then, some socialism is good for you? Strangely, my answer is no, or at least we would do better with a lot less of it than we have. Let me explain.

There is no divine decree that the reason for the wealth of nations is found exclusively along the capitalism / socialism axis. There could be any number of other reasons. Norwegians are almost exclusively white. I could just as well put this up as an explanation. Of course, that would be racism, but apart from that there is no difference. You just pick one random fact about the country and say "this is why it works so well". But you don't know that.

Nordic countries have more than a thousand years of practice in sexual equality, at least by the standard of the times. Are you sure this is not the reason why we are doing so well? If you make a graph of all the world's countries with the education level of their women and the economic growth in the country, you will find that the two are strangely parallel. The poor countries that remain in the world are all ones where women lack basic education. Of course, once again it is hard to say what is cause and what is effect until you change the values for one country and see what happens.

The Nordic countries are all small, at least in population. It is entirely possible that this is a main cause of their success. Luxembourg lies a bit further south from here but is also quite small, and even richer than Norway. Singapore is small by local standards, and amazingly well off for its neighborhood. It is entirely possible that it is easier for people to govern a country well if it is not too large and if it is fairly homogeneous in culture. While not everyone knows everyone else, you are still more likely to have direct influence on what goes on than in a vast empire.

As you see, it is not at all obvious that we can thank our moderate socialism for our good fortune. The socialists will of course say so, just as the racists will say that it is because we are white, the feminists will say it is because of our gender equality, and so on. What we do know from experience, however, is that when people get less socialism, they tend to like the change. When I was young, the State had a monopoly on broadcasting. No, seriously. This crazy regulation was repealed eventually, and I don't hear people cry out for monopoly again. (The national broadcasting remains popular, but then again it has had to work harder to keep up.) Likewise when I grew up, telephony was considered a natural monopoly. You had to apply for telephone, and then wait some months until the relevant branch of government decided it was your turn. Installing a telephone was expensive, using it was expensive, and the quality was poor. Now the monopoly is a fading memory. You can get a telephone in your lunch break, the price is quite modest and the quality is high. Even the reformed former monopoly is a lot better than it was when it was state-owned, although it is still more expensive.

People want freedom, and are very reluctant to give it up. Socialism means less freedom, and therefore it is an ideology doomed to extinction. If not for the help of George W. Bush, it might not have gained power again in Norway this fall, and even so the other side got most of the actual votes.

The Labor party is anyway not dogmatic socialists anymore, that's long in the past. There is also a third partner in the coalition, the agrarian Center Party, which is not really socialist at all. It is just opportunist, and yearns for the good old days when Norway was less urban. In a way we can say this is the one thing all three parties have in common: They want to go into the future with their rear first, looking to yesterday for answers to the challenges of tomorrow.

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Hmm, this wasn't exactly what I had planned to write. I thought I should say something about the various ministries and stuff. But hey, it is words of truth and wisdom. It will do for now. When the new government presents their own budget, I guess we can add some more. After all, what people truly consider important can not be found out from what they say, but from what they spend their money on. (Or, in this case, other people's money.)