Sweden's Response to European Crisis? Lower Taxes, Shrink GovernmentSubmitted by TexanInSweden on Sat, 08/04/2012 - 02:21
"When individuals and families get to keep more of their income, their independence and their opportunities to shape their own lives also increase."
Anders Borg, Swedish Finance Minister
‘Everybody was told “stimulus, stimulus, stimulus”,’ he says — referring to the EU, IMF and the alphabet soup of agencies urging a global, debt-fuelled spending splurge. Borg, an economist, couldn’t work out how this would help. ‘It was surprising that Europe, given what we experienced in the 1970s and 80s with structural unemployment, believed that short-term Keynesianism could solve the problem.’ Non-economists, he says, ‘might have a tendency to fall for those kinds of messages’.
He continued to cut taxes and cut welfare-spending to pay for it; he even cut property taxes for the rich to lure entrepreneurs back to Sweden. The last bit was the most unpopular, but for Borg, economic recovery starts with entrepreneurs. If cutting taxes for the rich encouraged risk-taking, then it had to be done. ‘In most cases, the company would not have been created without the owner,’ he says. The Spectator
Swedish response to euro crisis:
- Eliminate national debt
- Lower Corporate tax rate
- Cut property taxes
- Cut luxury taxes
- Cap on annual government spending
- Cut welfare programs
- Increase Taxes tobacco and alcohol (no big dealstilled backwoods folk who still know how to make their own snus (dip) and moonshine)
Someone needs to tell Krugman, Bernanke, and all their Keynesian friends that their poster child country is doing exactly the opposite of what Keynesian theories are telling them to do. If anyone is looking for proof that Ron Paul's economic policies work you can now use Sweden as an example.
Not bad, now if they could just get out from under the yoke of the Pharma controlled national health care system Sweden could end up being the new powerhouse of the European economy.
You can read some articles on Anders Borg and Sweden here: