Paul Lachine

Where Europe Works

With Swedish cities roiled for weeks now by rioting by unemployed immigrants, many observers see a failure of the country’s economic model. Yet the Scandinavian model that has emerged over the last 20 years has provided the only viable route to sustained growth that Europe has seen in decades.

STOCKHOLM – With Swedish cities roiled for weeks now by rioting by unemployed immigrants, many observers see a failure of the country’s economic model. They are wrong. The Swedish/Scandinavian model that has emerged over the last 20 years has provided the only viable route to sustained growth that Europe has seen in decades.

Europeans should remember that perceptions of strength and weakness change fast. In the 1980’s, Scandinavian countries stood for chronic budget deficits, high inflation, and repeated devaluations. In 1999, The Economist labeled Germany “the sick man of the euro” – a monument of European sclerosis, with low growth and high unemployment.

Now, however, the specter of devaluation has disappeared from northern European countries. Budgets are close to balance, with less public expenditure and lower tax rates, while economic growth has recovered. The transformation of the old European welfare state started in northern Europe, and it is proceeding to most of the rest of the continent.

To continue reading, please log in or enter your email address.

To access our archive, please log in or register now and read two articles from our archive every month for free. For unlimited access to our archive, as well as to the unrivaled analysis of PS On Point, subscribe now.

required

By proceeding, you agree to our Terms of Service and Privacy Policy, which describes the personal data we collect and how we use it.

Log in

http://prosyn.org/iTOba74;

Cookies and Privacy

We use cookies to improve your experience on our website. To find out more, read our updated cookie policy and privacy policy.