Column by Fred Morgan, President & CEO of the State Chamber, published in The Journal Record on Sept. 30, 2019.
Last week, presidential hopeful U.S. Sen. Bernie Sanders, I-Vt., visited Oklahoma.
“I am asking for your help to work with me to transform this country, to transform this economy to create a government that works for all of us and not just the 1%,” Sanders proclaimed.
Indeed, Sanders and other candidates seek to radically transform our economy to a socialist model, especially as polling shows younger generations are embracing socialism. They often point to Sweden as justification, touting the so-called Nordic model of socialism, while casually dismissing the epic failures of China, Venezuela, and Cuba.
It’s true that Sweden has a large welfare state (paid in part with higher taxes on the poor and middle class compared to the United States). And while we all have different thoughts on the role of government, claims that Sweden has a liberal, socialist economy are patently false and completely ignore the lessons of history.
In fact, Sweden’s economy is “ruthless capitalism,” according to Johan Norberg, a Swede who focuses on globalization, entrepreneurship, and individual liberty at the Cato Institute.
In a recent interview with The Wall Street Journal, Norberg explains on the Swedish economy that “It’s more deregulated. The product markets are much fiercer competition, much more free trade. All of the companies know that they have to be world champions or they will be destroyed.”
Norberg notes Sweden enjoyed one of the world’s fastest-growing economies for almost a century. But from 1960 to 1980, it gambled on socialism, increasing government spending and taxes to support it. The consequences? Entrepreneurs left. Private-sector employment and disposable income fell. Economic growth plateaued.
Thankfully, Sweden returned to free-market principles in the 1990s. It cut capital gains and corporate taxes, deregulated industries, and embraced other free-market policies. Today, Sweden’s economy is envied by many thanks to “ruthless capitalism,” not socialism.
The lesson is clear: Cutting taxes and burdensome regulations on job creators will transform economies. While we’re starting to see progress at the state and federal level, more is needed. This is especially true in Oklahoma if we want to be a top ten state.
It’s been said that those who fail to learn from history are doomed to repeat it. If we don’t learn from Sweden’s gamble, we should at least heed Norberg’s advice on socialism: “It almost destroyed us, and it took some heroic efforts to get back on track.”