Economic Inequality in the US Versus in Sweden

An article in Canada’s leading conservative rag about the purported failure of the Swedish model led me, once again, to comparing data from Sweden to data from the US. First, just to get this out of the way, Sweden has a higher workforce participation rate than the US.

More importantly, the staggering income inequality in the US compared with Sweden’s relative equality means that the American poor are far, far worse off than the Swedish poor, and have been so for decades. The USA’s GDP per capita is just more than a third higher than this of Sweden, $43,500 versus $31,600. But in the US, the bottom quintile’s share of aggregate income was 3.6% in 1999 and is trending down, compared with 3.9% for the Swedish bottom decile in 2004 and an additional 6% for the second decile.

In other words, assuming that aggregate income has the same share of GDP in the US and Sweden, an assumption that probably works in the USA’s favor, the Swedish bottom quintile has twice as much income as the American one. And that doesn’t count the fact the Swedish poor get free health care.

What’s more, the US has always been like that, despite populist claims that it was better in the 1960s and 70s. The share of the American bottom quintile peaked at 4.4% in the mid-70s; the share of the Swedish bottom quintile bottomed at 9.4% in 2000, a year of high capital gains.

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26 Responses to Economic Inequality in the US Versus in Sweden

  1. muppt says:

    however, Sweden has really ugly women.

  2. rod. says:

    Yup, it’s really sad that in Sweden one doesn’t find so many overweight monsters as in the US. There’s nothing sexier than a 300 pound lady with 6 breasts and 4 asses.

    Seriously now:

    Having lived in both the US and in Sweden, I believe I am entitled to comment on this. Sweden, as a society, is far more advanced than the US. No question. The average Swede is far better educated (at all levels) than the average American. Did the Swedish system fail? I was there and I didn’t notice that. However, in the US, I got the impression that I was living in a declining empire, and that noone noticed that. So tell me which system failed? In 10 years, the answer will be ovious.

  3. Greg Jerome says:

    The idea of America as the land of opportunity and equality has been largely debunked through research, but still persists in the public mind. It is very hard for Americans to realized they may not be the best at something. Check out my comments here: http://gregjerome.wordpress.com/2007/02/06/the-myth-of-the-american-dream/

  4. rod. says:

    It’s hard for Americans to realize that an average Swede has a much higher standard of living than an average American.

    The US is still a land of opportunities, big opportunities, but for those who are educated. If you have no education and you’re poor, going to the US will only make you poorer. Unfortunately the streets are not paved with gold anymore…

  5. Axel says:

    I really like experts like Peter Foster who haven’t a clue about a foreign country (“I must admit that I have never been to Sweden, but I have never met a Swede that I didn’t like. Then again, I’ve only ever met one, an academic I encountered at a conference in Alabama.”). So what’s the basis for his idea that the Swedish model has failed, whatever that means? Seems that it’s only Johan Norberg’s book “In Defence of Global Capitalism”. Brilliant.

    Alon,
    what do you think about the effects of state welfare spending on religious practice? See for example “State Welfare Spending and Religiosity. A Cross-National Analysis” by Anthony Gill and Erik Lundsgaarde (2004), Rationality & Society 16(4).
    http://faculty.washington.edu/tgill/Gill%20Lundsgaarde%20Welfare%20Religion.pdf

  6. Alon Levy says:

    Greg, I’m way ahead of you. It’s not even a French-German dream; France and Germany have pretty low intergenerational income mobility coefficients. Just so that you understand how badly the US is doing, Singapore, a fascist state that would make Mussolini proud, has an intergenerational income regression coefficient of about .26, just under Sweden’s .27. It’s really a Danish-Norwegian-Finnish-Canadian dream; to get there, the US needs to cut its own coefficient from .47 to .19.

    Axel, I expect to write something about the study within the day. It’s on the one hand just good enough to merit discussion, but its conclusion is inconsistent with case studies I do know about, namely Britain’s, and its definition of “welfare spending” is a little problematic.

  7. muppt says:

    land of oppurtunity, not land of free hand-outs. So it’s not really wrong that you’ll only become better in US if you have the will to work hard.

    Btw, I heard Paul Wolfowitz is one of the 666 Zionist elders spreaded throughout the world.

  8. muppt says:

    If you are poor, then you definiently should go to Danish, Norwegian, Finnish, and Sweden, where you can leech off government welfare without even lifting a finger.

  9. muppt says:

    I heard Sweden women are skinnier because they spend all their money on plastic surgery.

  10. muppt says:

    U.N. report says jews are planning to revive the old Israel empire.

    http://eyeontheun.org/assets/attachments/documents/4556._A.HRC.4.17.pdf

  11. rod. says:

    @ muppt

    The countries are called: Denmark, Sweden, Finland, Norway. The citizens from this country are: Danish, Swedish, Finnish and Norwegian.

    Women in Sweden (and in Scandinavia in general) are beautiful by Nature. It’s in their genes. Nothing to do with plastic surgery. By the way, please allow me to note that beauty is not confined to Scandinavia… it’s just abundant there.

  12. Jason says:

    Really, really awful, sloppy use of statistics.

    You’re comparing share of aggregate money income (as defined by the U.S. census bureau) of the bottom fifth of U.S. households with share of aggregate “equalized disposable income, capital gains included” (as used by Statistics Sweden) of the bottom fifth of Swedish individuals and then applying those to GDP per capita. It’s apples and oranges. It’s meaningless.

  13. muppt says:

    show me one good looking swedish woman!

  14. Alon Levy says:

    Jason, when you do decile shares, “equalized disposable income” means weighting households based on size.

  15. Ran Halprin says:

    Re muppet – this “report” is written like pure propaganda. It uses Palestinian propaganda terms (such as “Occupied Palestinian territory”) instead of balanced views (lands in dispute between Israel and the Palestinian Authority), and it is factually wrong:

    “… is the only instance of a developing country that is denied the right of self-determination and oppressed by a Western-affiliated State.”

    First of all, Israel does not deny the right of self determination from a developing country:
    1. Because Palestine is not a country, it is only an idea to create a country for the Arabs whom Jordan and Egypt have abandoned in Gaza and the West Bank,
    2. Because Israel has no say in the Palestinians self determination. Israel helped the PA come into being, and now that the Palestinians have a leadership, they may work with the UN on formalities of statehood.
    3. Many Western affiliated states actually do prevent self determination – Turkey prevents it from the Kurds, Britain prevents it from Northern Ireland, Spain prevents it from the Catalans, Canada prevents it from Quebec, and I’m sure many other examples I am not aware of exist.

    If the human rights people want to be heard (and they do have important points to emphasize in the Israeli treatment of the Palestinians), they need to start off by getting their facts straight and by not taking sides in local disputes. Biased papers would only be ignored by any sane person or group.

  16. Alon Levy says:

    Ran, Quebec is free to secede any time it wants. It hasn’t yet because its people have decided it’s not in their economic interest.

    Also, how many Catalan civilians have been lynched by aggressive Castilian settlers?

  17. Ran Halprin says:

    If Quebec is so free to secede, why did they go about and murder a Canadian minister in the name of their cause?

    Re lynching – to the best of my knowledge, no Catalan have been lynched by Spaniards, nor have any Palestinians been lynched by Israelis. On the other hand, there have been many cases of Palestinians lynching Israelis:
    http://news.bbc.co.uk/2/hi/middle_east/969778.stm

    As well as Palestinians:

    http://www.worldnetdaily.com/news/article.asp?ARTICLE_ID=27415

  18. Ran Halprin says:

    P.S: Even if settlers lynched a million Palestinians, what difference does it make in the stand of any conflict? I don’t see you becoming pro-Israeli in the conflict after Palestinian terror attack, why would you consider Israeli terror attacks a cause for being pro-Palestinian?

  19. Alon Levy says:

    Ran, check what settlers do to Palestinians for olive crops. That, and the IDF has failure-shot civilians in the past.

    Even if settlers lynched a million Palestinians, what difference does it make in the stand of any conflict?

    Well, to someone of your capactiy for empathy with people of the wrong nationality, nothing. For us humans, it matters that one side is constantly killing the other’s civilians. Numbers matter; in the case of the I/P conflict, the current ratio of Israeli to Palestinian dead is about 1 to 3. To paraphrase Arthur C. Clarke, any sufficiently advanced incompetence, as in the incompetence that has caused Israel to kill thousands of civilians in order to defend an occupation that isn’t going to last, is indistinguishable from malice.

  20. Ran Halprin says:

    check what settlers do to Palestinians for olive crops.
    So what? There are extremists everywhere, and if 16 Israelis commit terrorism against Palestinian property, is this really worse then the 100,000 Palestinians who commit terrorism against Israeli lives? I really don’t follow your logic here.

    Moreover, what’s important is not the actions of the fanatic individuals, but rather the actions and words of the nation as a whole. Israel’s supreme court ruled on the subject regarding IDF protection of Palestinians: “Protecting the security and possessions of the local residents is among the most basic obligations of the military commander in the field.”

    Meanwhile, the Palestinian leadership uses phrases such as “weapons should be turned only against Israel” and teachers must, by order of the PA, use books that include the following examples:
    “…Martyred Jihad fighters are the most honored people, after the Prophets…” [Reader And Literary Texts for Tenth Grade #607, p. 103]
    Draw your sword… let us gather for war with red blood and blazing fire…Death shall call and the sword shall be crazed from much slaughter… Oh Palestine, the youth will redeem your land…” [Reader and Literary Texts for Eighth Grade #578, p. 120-122]
    “Know, my son, that Palestine is your country… that its pure soil is drenched with the blood of Martyrs… Why must we fight the Jews and drive them out of our land?” [Our Arabic Language for Fifth Grade #542, p. 64-66]
    “Why do the Jews hate Muslim unity and want to cause division among them? Give an example of the evil attempts of the Jews, from events happening today.” [Islamic Education for Seventh Grade #745, p. 19]
    “Write in your exercise book: An event showing the fanaticism of the Jews in Palestine against Muslims or Christians.” [Islamic Education for Ninth Grade #589, p. 182]
    “Jerusalem is an ancient Arab city, built by the Jebusite Arabs before Islam… ” [Islamic Education for Eighth Grade #576, p. 50]

    That, and the IDF has failure-shot civilians in the past.
    There is no war I know of in which civilians don’t die. Israel utilizes its army’s superiority to keep civilian casualties much lower then similar conflicts in the rest of the world do. Since the Palestinians started the war (and refused to end it to this very day), its hard to blame Israel for the war’s casualties.

    Well, to someone of your capactiy for empathy with people of the wrong nationality, nothing.

    Why do you again attack me personally? Have I in any point of discussion attack you? Have I at any point of discussion proved to be a nationalist with no empathy for human lives?
    I’ve been showing you facts and opinions that contradict your claims, and you’ve been ignoring them one after the other when they didn’t suit you. Are you just stuck in your mantra of Israel’s inherent evilness with complete disregard to evidence brought before you?

    For us humans, it matters that one side is constantly killing the other’s civilians. Numbers matter; in the case of the I/P conflict, the current ratio of Israeli to Palestinian dead is about 1 to 3.

    Of course the Palestinians suffer more casualties. They are the weak side of an aggressive war they initiated. The side with the weakest army always suffers more casualties. In world war 2, the US suffered 1 million casualties, while Japan suffered 2.6 million. Thats almost the same 1:3 ratio. The UK suffered 0.45 million casualties, while Nazi Germany suffered 7.5 million casualties. Does this mean the British need to apologize to Nazi Germany and that military support should have been denied from the UK?

    Basically, you are saying that Israel should let the Palestinians kill some more Israelis before retaliating, in order to keep the ratio 1:1. You are calling for more murder of Israeli civilians. And you claim that you are empathic to human lives?!

    To paraphrase Arthur C. Clarke, any sufficiently advanced incompetence, as in the incompetence that has caused Israel to kill thousands of civilians in order to defend an occupation that isn’t going to last, is indistinguishable from malice.

    First of all, Palestinians civilian don’t die because Israel “defends an occupation”. They die when Palestinian terrorists use civilian buildings and equipment (e.g. ambulance) to launch attacks against Israeli civilians. They die when they participate in a war (a civilian attempting to murder Israelis is a terrorist, no matter what “cause” he has for it). The Israeli army keeps the war on the Palestinian side because frankly, an army’s duty is first to defend its country’s civilians, and only afterwards to prevent enemy civilian casualties. They are also better fighters and better equipped then the terrorists, which makes their casualties lower in war.

    The occupation of the Palestinian people is a direct and unavoidable effect of the war that they initiated. In all of recent history, a side that lost a war was at the mercy of the victors in terms of surrendering (usually mostly financial compensation). The difference is that while Nazi Germany, Japan, and other nations have surrendered, taken the blame, paid and moved on, the Palestinians, continued the war even after they lost and were offered “free” peace.

    Israel tried to end the occupation several times, but the Palestinian leadership refused to negotiate it. They will take no less then the destruction of Israel. It’s their official stance. You know this.

  21. Ran Halprin says:

    And to sum up: Number don’t matter. Intentions matter.

    Alice takes a gun, goes out to a shopping mall and guns down 4 people that don’t have her favorite color before being detained by a police officer.

    Bob is an engineer. He built a bridge and it collapsed due to an error in his calculations, killing 12 people. He apologizes, cries for them, and hands himself to the police.

    Which of the two would get a larger jail time? I’m sure you would say Alice. In the western court system, intention clearly matters more then numbers. Why does your opinion suddenly change in this case?

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