That’s the recipe for success in a globalized world, according to Magdalena Andersson, the Social Democratic economist who’s also Sweden’s finance minister.
The 50-year-old has been raising taxes and spending more on welfare since winning power in 2014. She’s also overseen an economic boom, with Swedish growth rates topping 4 percent early last year, that has turned budget deficits into surpluses.
❝ In a world still flinching from the financial crisis that hit a decade ago and the populist wave that followed, Sweden’s economic stewardship holds lessons that challenge the conventional wisdom in the U.S. on how taxes work, according to the Harvard-educated minister. Speaking in an interview in Stockholm, Andersson says success comes down to “three things: It’s the jobs, it’s our welfare and it’s our redistribution.”
❝ It’s the polar opposite of the policy being developed across the Atlantic, where U.S. President Donald Trump is hoping tax cuts, less regulation and new trade deals will produce 3 percent growth within two years. Meanwhile, in Europe, the Nordic model is attracting attention. Emmanuel Macron, who on Sunday defeated Front National’s Marine Le Pen in the French presidential election, has urged his country to look north for ideas on how to organize a society.
❝ Andersson, who lists health care and education, “regardless of how much you earn,” as key to running a successful economy, points to income redistribution as the shield that can keep populist shocks at bay…
The numbers are compelling. Sweden has one of the world’s highest tax burdens, with tax revenue about 43 percent of GDP, according to OECD data. The equivalent figure for the U.S. is about 26 percent. Sweden’s economy has grown almost twice as fast as America’s, expanding 3.1 percent last year, compared with 1.6 percent in the U.S….
Sweden has the highest labor force participation in the European Union. Andersson attributes this to tax-funded parental leave and affordable daycare, which make it easier for both parents to work.
In contrast to most of its European peers, Sweden has budget surpluses. The EU average will be a shortfall of 1.6 percent in 2018, while the estimated deficit in the U.S. of 5.7 percent of GDP…
Taxes are always negative for the folks required to pay the most taxes. Especially if you aren’t allowed loopholes by bought-and-paid-for politicians. Running a nation’s economy to benefit the whole population is nothing that would ever occur to most American politicians – regardless of how often they lie and say that’s exactly what they’re doing. Perish the fact that so-called trickle-down economics have never produced anything other than more wealth for fewer people. And screwed the rest of us.