On Monday The Washington Post posted an article about how the economies of the Nordic countries work.
These are some of the things noted:
Undoubtedly, the Nordic nations, with their high incomes, low inequality, free politics and strong rule of law, represent success stories. What this has to do with socialism, though, is another question.
And the answer, according to a highly clarifying new report from analysts at JPMorgan Chase, is “not much.”
Drawing on data from the World Bank, the Organization of Economic Cooperation and Development and other reputable sources, the report shows that five nations — Sweden, Denmark, Finland, Norway and the Netherlands — protect property rights somewhat more aggressively than the United States, on average; exercise less control over private enterprise; permit greater concentration in the banking sector; and distribute a smaller share of their total income to workers.
“Copy the Nordic model if you like, but understand that it entails a lot of capitalism and pro-business policies, a lot of taxation on middle class spending and wages, minimal reliance on corporate taxation and plenty of co-pays and deductibles in its healthcare system,” the report notes.
This really does not sound like the utopia that Bernie Sanders is pushing–particularly the co-pays and deductions.
The article continues:
Sanders and other left-leaning Democrats promise to pay for tuition-free college and Medicare-for-all with higher taxes on the top 1 percent of earners. Most Nordic countries, by contrast, have zero estate tax. They fund generous programs with the help of value-added taxes that heavily affect middle-class consumers.
In Sweden, for example, consumption, social security and payroll taxes total 27 percent of gross domestic product, as compared with 10.6 percent in the United States, according to the JPMorgan Chase report. The Nordic countries tried direct wealth taxes such as the one that figures prominently in the plans of Sen. Elizabeth Warren (D-Mass.); all but Norway abandoned them because of widespread implementation problems.
The Nordic countries’ use of co-pays and deductibles in health care may be especially eye-opening to anyone considering Sanders’s Medicare-for-all plan, which the presidential candidate pitches as an effort to bring the United States into line with European standards.
His plan offers an all-encompassing, government-funded zero-co-pay, zero-deductible suite of benefits, from dental checkups to major surgery — which no Nordic nation provides.
The Netherlands’ health insurance system centers on an Obamacare-like mandate to buy a private plan; individuals face an annual deductible of $465 (as of 2016), according to the Boston-based Commonwealth Fund.
Dutch consumers’ out-of-pocket spending on health care represented 11 percent of total health expenditures in 2016, according to the Peterson-Kaiser Health System Tracker — the same percentage as in the United States. In Sweden, meanwhile, out-of-pocket spending accounted for 15 percent of health expenditures. Who knew?
The article concludes by noting that the burden for these programs falls on the middle class–the rich will always have tax accountants to limit the amount of taxes they pay–the middle class has no such luxury. Bernie Sanders’ proposals will essentially rob the poor to pay the rich. I really don’t think that is what most Americans have in mind.