The Swedish Model

What can the United States learn from Sweden?

by Drew McKinley

Sweden is seen as the prime example of a government centric state so one would assume the recession of 2008 would have been devastating. But wait:  During the third quarter of 2010, Sweden experienced a record growth of 6.9% in its annual GDP (1) and saw its unemployment rate shrink (2), all while the United States economy remains stagnate. Since the 1990s, Sweden’s center-right party leaders have been striving to put the country on the path to prosperity by launching a process of economic liberalization. In the past two decades, they have been moving Sweden towards the free market with impressive results.

The reform started with the Swedish government selling off its stakes in corporations, privatizing and deregulating industries, cutting taxes, creating a private retirement fund for public employees and instituting nationwide school vouchers. Public sector pensions have also been reduced to a more sustainable level. Additionally, since these changes have been enacted, the number of people on welfare has decreased by as much as 150,000 since 2006 (3), demonstrating that economic freedom is still the best way to fight poverty.

Additionally, the ruling center-right party responsible for the recent cuts enjoys high levels of popularity for cutting taxes and doing what is necessary to create a stable fiscal future for Sweden.  Here in the U.S., this is an encouraging sign to those worried that a vote to cut spending and balance the budget will be damaging in the next election cycle. American politicians, take note and take action to restore economic freedoms and fiscal sanity here at home.