Scandinavia as
Discussed by Micklethwait and Wooldridge
“In The Fourth
Revolution, M&W view Sweden in a more positive light than we (actually,
the Swedish think tank, Captus)
did in our 6/27/14
posting on socialism. ‘Sweden
just put its pension system on a sound foundation, replacing a defined-benefit
system with a defined-contribution one and making automatic adjustments for
longer life expectancy. It has
reinvented its state as well as reduced its size.’ “
“You’ll like this, Curmudge. They have introduced Lean, the Toyota production system, in
St. Gören’s Hospital in Stockholm.
That’s the same Lean that we wrote about for five years. ‘The focus at St. Gören’s is on
reducing waiting times and increasing throughput.’ That seems consistent with a recent article (1) that states,
‘Months-long waiting times for treatment routinely available in the U.S. have
been widely documented.’
Nevertheless, according to M&W, ‘Sweden has done most of the things
that politicians know they ought to do but seldom have the courage to
attempt.’ They also point out that
(all) ‘the Nordic countries provide strong evidence that it is possible to
contain government while improving its performance.’ Let’s hope that that is not limited to small, relatively monolithic
societies.”
America’s
Problems As Seen by M&W
“Julie, a few days ago I mentioned to an acquaintance that I
had written about the achievements of Margaret Thatcher and Ronald Reagan, and
he walked away in apparent disgust.
That suggests that there are some highly educated people who must be
oblivious to the mess that our government has become.”
“Your acquaintance is probably not a fan of our blog, and he
certainly wouldn’t like Micklethwait & Wooldridge’s book. Like them or not, here are some of the
problems noted by M&W:
The national debt: ‘The declared national debt is around $13
trillion, but the federal government’s off-balance-sheet commitments in 2012
came to $70 trillion.’
The tax code: ‘Four million words, containing subsidies,
exemptions, and complications that favor the rich, such as the deduction for
interest on a home mortgage.’
(Think of a person who can afford a multi-million dollar home deducting
his mortgage interest.) ‘Tax
loopholes and exemptions are collectively worth $1.3 trillion.’
Entitlements: ‘Equality of opportunity has become equality
of results. Fraternity has become
about entitlements that we are all due, not responsibilities that we all
have.’ ‘The more the state fails
to meet its impossible targets, the more it resorts to micromanagement to make
up for its failures.’
Crony capitalism: Well-connected industries receive mammoth
subsidies. ‘The U.S. Dept. of
Agriculture (USDA), with 100,000 employees, provides $10-$30 billion in cash
subsidies to farmers each year.
The largest 10% of farmers received 68% of all commodity subsidies in
2010.’ “
“And the list can go on and on, Julie. Our government has become bloated and
inefficient, yet voters seem to want more services with lower taxes. The authors are concerned that the
state will keep expanding and reducing liberty and that it will surrender more
power to special interests.
Plato’s two criticisms of democracy remain valid: Voters will put
short-term satisfaction above long-term prudence and that politicians will try
to bribe their way to power—as they have done by promising entitlements that
future generations will have to pay for.
And as stated by M&W, ‘Reform is as much about changing mentality as
about redesigning structures.’ “
Micklethwait
& Wooldridge’s Thoughts on Improvement
“According to the book, Old Guy, M&W’s starting point is
classical liberalism. ‘We want the
state to be smaller and individuals to be freer.’ They list ‘three areas for unburdening the state: (a)
selling things that the state has no business owning, (b) cutting the subsidies
that go to the rich and well connected, and (c) reforming entitlements to make
sure that they are targeted to people who need them and sustainable in the long
term.’ The Department of the
Interior oversees 260 million acres; the agricultural land (but not national
parks) could be sold. The
government owns more than 900,000 buildings, many of which are underused or
unneeded. The need to reform
entitlements is widely recognized, but actually doing something faces a lot of
inertia. This situation was described
by the former prime minister of Luxembourg: ‘We all know what to do, but we
don’t know how to get re-elected once we have done it.’ So, Professor, how do M&W wrap up
their story?”
“They remind us what John Adams said about democracy 200
years ago: ‘It is in vain to say that democracy is less vain, less proud, less
selfish, less ambitious, or less avaricious than aristocracy or monarchy.’ ‘These passions are the same in all
men…and when unchecked, produce the same effects of fraud, violence, and cruelty.’ With that as history, M&W observe
that ‘the welfare state has sprawled and democracy has become self-indulgent,
tawdry, and, too often, corrupt.’
It will be difficult to convince people that the state will become
stronger by being leaner and offering fewer benefits, but the survival of our
democracy may depend upon it. ‘Any
state that harnesses the most powerful innovative forces in society will pull
ahead of its peers.’ That has been
shown by history. ‘The West has
been the world’s most creative region because it has repeatedly reinvented the
state.’ “
“I hope that state is us, Curmudge. Presumably we’ll defer our discussion
of the e-book, Room to Grow, to our
next posting."
Kaizen Curmudgeon
(1) Atlas,
Scott W. The Wall Street Journal
8/14/14, p. A13.
Link to posting from blog archives: Stan’s Story Redux—12/29/10
http://kaizencurmudgeon.blogspot.com/2010/12/stans-story-redux.html
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