The Nordic Model and its Oz prospects
If one looks at comparative international statistics, the continuing success of the Nordic model-despite a rough patch in early to mid 90s-is quite clear. So, a natural question is: can Oz learn from them? (Of course, Oz also does well in comparative international statistics.)
May 2, went to a well-attended CERC seminar by Andrew Scott (author of Running on Empty), The relevance of social democracy in northern Europe to Australia. Andrew Scott presented a sensible and informative paper on the Nordic model plus interest in it from Australia with some suggestive comments about its possible applicability to Oz. I was particularly struck by his comments that a strong social safety net made people more open to shifting to new jobs and industries in response to market opportunities. (Concern for economic efficiency is a feature of the Nordic model.)
There was also a question and answer session afterwards:
Q (John Langmore): What about Clive Hamilton’s recent writing on the end of social democracy?
A: Only skimmed, but title more provocative than content.
Q: Australia has a “fair go” “egalitarian” ethos. How does one counter Americanisation?
A: Limited evidence that wage-earner-welfarism [old Deakinite system] was more egalitarian, but male concept of equality. Social democracy has more robust and extensive concept of equality than labourism. Evidence of concern among Oz public with Americanisation and desire for more social provision given signs of decay of social infrastructure. Labor suffers a sense of siege from globalisation.
Q: Swedish English language literature from folk with extensive overseas experience criticising model, particularly social solidarity, from left as conservative. Much of foreign literature is about using Sweden to make arguments about home countries. In Sweden, opposition was very divided. There is a critique of it as a dull, boring, unimaginative dystopia. Liberalism is “English”. Did have a privileged WWII position. Also, convergence occurring (such privatisations at local level). The model is one of little steps at a time, but that is what works.
A: Broadly agree. Proportional representation as an electoral system works better for social democracy than majoritarianism.
Q (erudito): Oz and US produce more children proportionately, which might affect child poverty rates. Seems to be some issues arising in Scandinavia about integration of Muslims. Sweden also shows high rates of capital concentration (Scott nodded to the last).
A: Fertility rates comparable. There is an argument that redistribution is easier to same ethnic group. Some evidence that more extensive welfare state means less right wing populism (cited Swank).
C (Leslie Holmes): Nordic countries have “high” crime rates according to police statistics since social trust high and more likely to report. Lower the confidence in police, the less likely to report. So it highlights the level of social capital.
C (John Langmore): US highest incarceration rate in the developed world.
Q (John Langmore): Lessons for industrial policy.
A: Doing very well in manufacturing for small country, so there are lessons for Australia in that.
Q (Brian Howe): What about ALP-Union relationship, given unions are much less representative nowadays.
A: In Sweden, LO and SDP no longer formally affiliated. Sweden has much higher unionisation rate. The ALP’s problem is precisely because of the decline in membership of both.
While no social system is perfect nor likely to conform to every set of preferences, it seems pointless to deny that the Nordic societies are very successful. So, the applicability of the Nordic model to Oz is a very reasonable question. Scott counterposed appeals to universalism (typically about globalisation) and appeals to path-dependence (too much dissimilar development).
I can identify four grounds on which to be sceptical of the applicability of the Nordic model to Oz.
Economic structures As is normal for enthusiasts for the Nordic model (or European models generally) Scott thinks Oz should encourage manufacturing more. Now, it is possible that businessfolk and politicians in all the settler societies have been persistently stupid in missing lots of profit and development opportunities. Alternatively, there might be deeper economic reasons why all the settler societies are post-industrial service economies. (My vote.) If the Nordic model requires a manufacturing-based economy, then its applicability to any of the settler societies is moot. (As it happens, I am sceptical that the Nordic model does require a manufacturing-based economy.)
Geographical variety Oz is far more ecologically varied than any of the Nordic countries and its population is far more geographically dispersed. This makes a high level of centralised provision inherently problematic.
Cultural variety The Nordic model requires very high levels of information flow between officials and public, high levels of trust (between public and officials, within the populace and across generations) and high levels of commonality in preferences. Cultural diversity is antipathetic to all of these. The full version of social democracy grew up in monocultural societies (Scandinavia, postwar Austria). Attempts to apply it to culturally diverse countries (Belgium, the Netherlands) have been less successful. The greatest failure in application of social democratic policy models in Oz have been in indigenous policy, where cultural difference is highest and information flows are at their most attenuated. Conversely, the traditions of liberal economics have been strongest in culturally diverse societies (UK, the Danubian monarchy, US). A more liberal policy mix copes with diversity better.
One of the lessons of recent times is that, despite what folk often seem to claim, transfers which persistently flow from one identifiable group to another do not help bind a society. They might be politically relatively unproblematic for a decade, perhaps two. By third decade, if such transfers continue to operate in a one-sided way, they are clearly massive open cheques subsidising failure and folk start to jack up. (Such as, for example, Western Canada to rest, Flanders to Walloons, middle America to inner city, employed Oz to indigenous, Northern Italy to Southern Italy, England to Celtic fringe.) Such transfers are implicitly based on notion of solving problems: if the transfer is endless, it becomes explicitly paying for (someone else’s) failure.
Status-oriented intelligentsia The Nordic model requires very high levels of information flow between officials and public, high levels of trust (between public and officials, within the populace and across generations) and high levels of commonality in preferences. Which requires a service-oriented intelligentsia-one genuinely interested in how the world is and how to connect that with what folk want. An intelligentsia which is primarily in its own status-one where the proletariat have become rednecks to be sneered at and lauded over, where dissent is evil because correct opinions mark status so incorrect opinions mark moral and intellectual inadequacy, where empirical disagreement is a moral affront-is not only useless for implementing the Nordic model, it is an active barrier to such implementation. It actively undermines information flows, undermines trust (particularly since public “debate” becomes either compartmentalised or an exercise in shutting out inconvenient voices), flaunts differences in preferences, pushes policies on basis of display rather than consequences (which discourages confidence in government action, particularly welfare).
An intelligentsia which, for example, damns most fellow Australians as “racist” to justify denying them any say in migration policy, which supports land-rationing (i.e. denouncing urban sprawl) making home ownership and rents much more expensive, denounces cars in favour of public transport which does not service where most workers live or work, denounces dissent on welfare policy regardless of what most folk want or what is actually happening, denounces concerns about failed differential provision for indigenous Australians as racist, denounces concerns about ethnic gangs as racist, which denounces concern for economic efficiency as evil ‘neoliberalism’ is patently an intelligentsia that is simply not capable of implementing (or even tolerating) the high levels of information flow, high levels of trust and high levels of commonality in preferences that the Nordic model needs to operate.
Andrew Scott and his audience clearly felt that the biggest barrier to implementing the Nordic model in Oz was “neoliberalism” and neoliberals. No, the biggest barrier is the sort of folk who were in that lecture theatre (plus the cultural diversity they are so keen on). ADDENDA After all, as sociologist Katharine Betts has documented from the Australian Electoral Studies, the biggest gap in Oz politics is between working class voters and the sort of folk who become ALP, Democrat and Green candidates.
May 2, went to a well-attended CERC seminar by Andrew Scott (author of Running on Empty), The relevance of social democracy in northern Europe to Australia. Andrew Scott presented a sensible and informative paper on the Nordic model plus interest in it from Australia with some suggestive comments about its possible applicability to Oz. I was particularly struck by his comments that a strong social safety net made people more open to shifting to new jobs and industries in response to market opportunities. (Concern for economic efficiency is a feature of the Nordic model.)
There was also a question and answer session afterwards:
Q (John Langmore): What about Clive Hamilton’s recent writing on the end of social democracy?
A: Only skimmed, but title more provocative than content.
Q: Australia has a “fair go” “egalitarian” ethos. How does one counter Americanisation?
A: Limited evidence that wage-earner-welfarism [old Deakinite system] was more egalitarian, but male concept of equality. Social democracy has more robust and extensive concept of equality than labourism. Evidence of concern among Oz public with Americanisation and desire for more social provision given signs of decay of social infrastructure. Labor suffers a sense of siege from globalisation.
Q: Swedish English language literature from folk with extensive overseas experience criticising model, particularly social solidarity, from left as conservative. Much of foreign literature is about using Sweden to make arguments about home countries. In Sweden, opposition was very divided. There is a critique of it as a dull, boring, unimaginative dystopia. Liberalism is “English”. Did have a privileged WWII position. Also, convergence occurring (such privatisations at local level). The model is one of little steps at a time, but that is what works.
A: Broadly agree. Proportional representation as an electoral system works better for social democracy than majoritarianism.
Q (erudito): Oz and US produce more children proportionately, which might affect child poverty rates. Seems to be some issues arising in Scandinavia about integration of Muslims. Sweden also shows high rates of capital concentration (Scott nodded to the last).
A: Fertility rates comparable. There is an argument that redistribution is easier to same ethnic group. Some evidence that more extensive welfare state means less right wing populism (cited Swank).
C (Leslie Holmes): Nordic countries have “high” crime rates according to police statistics since social trust high and more likely to report. Lower the confidence in police, the less likely to report. So it highlights the level of social capital.
C (John Langmore): US highest incarceration rate in the developed world.
Q (John Langmore): Lessons for industrial policy.
A: Doing very well in manufacturing for small country, so there are lessons for Australia in that.
Q (Brian Howe): What about ALP-Union relationship, given unions are much less representative nowadays.
A: In Sweden, LO and SDP no longer formally affiliated. Sweden has much higher unionisation rate. The ALP’s problem is precisely because of the decline in membership of both.
While no social system is perfect nor likely to conform to every set of preferences, it seems pointless to deny that the Nordic societies are very successful. So, the applicability of the Nordic model to Oz is a very reasonable question. Scott counterposed appeals to universalism (typically about globalisation) and appeals to path-dependence (too much dissimilar development).
I can identify four grounds on which to be sceptical of the applicability of the Nordic model to Oz.
Economic structures As is normal for enthusiasts for the Nordic model (or European models generally) Scott thinks Oz should encourage manufacturing more. Now, it is possible that businessfolk and politicians in all the settler societies have been persistently stupid in missing lots of profit and development opportunities. Alternatively, there might be deeper economic reasons why all the settler societies are post-industrial service economies. (My vote.) If the Nordic model requires a manufacturing-based economy, then its applicability to any of the settler societies is moot. (As it happens, I am sceptical that the Nordic model does require a manufacturing-based economy.)
Geographical variety Oz is far more ecologically varied than any of the Nordic countries and its population is far more geographically dispersed. This makes a high level of centralised provision inherently problematic.
Cultural variety The Nordic model requires very high levels of information flow between officials and public, high levels of trust (between public and officials, within the populace and across generations) and high levels of commonality in preferences. Cultural diversity is antipathetic to all of these. The full version of social democracy grew up in monocultural societies (Scandinavia, postwar Austria). Attempts to apply it to culturally diverse countries (Belgium, the Netherlands) have been less successful. The greatest failure in application of social democratic policy models in Oz have been in indigenous policy, where cultural difference is highest and information flows are at their most attenuated. Conversely, the traditions of liberal economics have been strongest in culturally diverse societies (UK, the Danubian monarchy, US). A more liberal policy mix copes with diversity better.
One of the lessons of recent times is that, despite what folk often seem to claim, transfers which persistently flow from one identifiable group to another do not help bind a society. They might be politically relatively unproblematic for a decade, perhaps two. By third decade, if such transfers continue to operate in a one-sided way, they are clearly massive open cheques subsidising failure and folk start to jack up. (Such as, for example, Western Canada to rest, Flanders to Walloons, middle America to inner city, employed Oz to indigenous, Northern Italy to Southern Italy, England to Celtic fringe.) Such transfers are implicitly based on notion of solving problems: if the transfer is endless, it becomes explicitly paying for (someone else’s) failure.
Status-oriented intelligentsia The Nordic model requires very high levels of information flow between officials and public, high levels of trust (between public and officials, within the populace and across generations) and high levels of commonality in preferences. Which requires a service-oriented intelligentsia-one genuinely interested in how the world is and how to connect that with what folk want. An intelligentsia which is primarily in its own status-one where the proletariat have become rednecks to be sneered at and lauded over, where dissent is evil because correct opinions mark status so incorrect opinions mark moral and intellectual inadequacy, where empirical disagreement is a moral affront-is not only useless for implementing the Nordic model, it is an active barrier to such implementation. It actively undermines information flows, undermines trust (particularly since public “debate” becomes either compartmentalised or an exercise in shutting out inconvenient voices), flaunts differences in preferences, pushes policies on basis of display rather than consequences (which discourages confidence in government action, particularly welfare).
An intelligentsia which, for example, damns most fellow Australians as “racist” to justify denying them any say in migration policy, which supports land-rationing (i.e. denouncing urban sprawl) making home ownership and rents much more expensive, denounces cars in favour of public transport which does not service where most workers live or work, denounces dissent on welfare policy regardless of what most folk want or what is actually happening, denounces concerns about failed differential provision for indigenous Australians as racist, denounces concerns about ethnic gangs as racist, which denounces concern for economic efficiency as evil ‘neoliberalism’ is patently an intelligentsia that is simply not capable of implementing (or even tolerating) the high levels of information flow, high levels of trust and high levels of commonality in preferences that the Nordic model needs to operate.
Andrew Scott and his audience clearly felt that the biggest barrier to implementing the Nordic model in Oz was “neoliberalism” and neoliberals. No, the biggest barrier is the sort of folk who were in that lecture theatre (plus the cultural diversity they are so keen on). ADDENDA After all, as sociologist Katharine Betts has documented from the Australian Electoral Studies, the biggest gap in Oz politics is between working class voters and the sort of folk who become ALP, Democrat and Green candidates.