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Milton Ezrati, senior economist and market strategist at Lord Abbett, points out that in response to the global recession, the Swedish government (like many of its peers) increased stimulus spending, but, unlike most other governments, “refused to respond to resulting budget deficits with any consideration of tax increases, much less a turn to austerity, as many governments in Europe have begun to do, even as the recession’s effects on income and employment linger.”
Thus, instead of heavy government spending (as was done in the U.S.), Ezrati indicates that Sweden’s government reserved two-thirds of its stimulus for across-the-board tax cuts.
Aslund explains that while the Swedish government (and society) is still committed to social awareness, there is more of a focus on limited and proportional spending on social programs.
“The role of the state is still large and welfare is pretty comprehensive, but public expenditure has shrunk impressively,” he said.
“Social transfers have been trimmed. There is now a sense of proportion of how much a government can do – and more of a reliance on market forces, where suitable, and on efficiency.”
Sweden sounds like an interesting country. Even though I agree that the country is too small to serve as a model for the U.S I like how flexible the country is with change.
It's a growing trend that took place in the 1980's and has spread throughout the world rather rapidly considering the thought process that was going on in government in the early to mid 20th century.
Sweden sounds like an interesting country. Even though I agree that the country is too small to serve as a model for the U.S I like how flexible the country is with change.
The US stimulus bill was 45% tax cuts so keep that it mind.
Tax Benefits
Funds Made Available $0B
Funds Paid Out $243.4B
Total Recovery Act Funds $288B Contracts, Grants, Loans
Funds Made Available $275B
Funds Paid Out $158.4B
Total Recovery Act Funds $275B Entitlements
Funds Made Available $181.4B
Funds Paid Out $169.2B
Total Recovery Act Funds $224B
Beside the inability to actually figure out percentages, many of those tax "cuts" were actually credits which the Recovery.gov websites fully agrees with or else they would have called them tax cuts. Instead they called them "tax benefits."
Credits mean that those people have an even larger negative tax liability. In other words it was mostly wealth redistribution. Which is the opposite of "Social transfers have been trimmed."
To those who disagree with Sweden's system. How else should a country of 9 million people that's largely homogenous be run?
Isn't Sweden using an approach to development that works for them in relation to their circumstances? I think countries generally will adopt economic and social spending policies based on what their particular country has to deal with as far as population size and defense needs for example. With only 9 million people to deal with I guess Sweden can have a larger welfare system in comparison to what America can have with it's 300 million population.
Last edited by Motion; 11-20-2010 at 12:15 PM..
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More fuzzy left-wing math...
