‘Capitalist’ US vs ‘Socialist’ Finland

“No one would argue that the Nordic countries are full-blown socialist countries, whatever that might mean. But it is also folly to pretend the only thing they have proven is that high taxes and large welfare states can work. Even on the narrow understanding of socialism as public ownership of enterprise, the Nordic countries are far more socialistic than most commentators seem to realize. American socialists who draw inspiration from their successes do so rightly.”
~Matt Bruenig, Nordic Socialism Is Realer Than You Think

Finland vs America is simply socialism vs capitalism. The Finnish are running their public education system according to the model of democratic socialism (in case you didn’t know, democratic socialism is what Marx was advocating).

In Finland, their social democracy doesn’t encourage or prioritize capitalist competition but instead encourages and prioritizes democracy in its best sense. In America, on the other hand, capitalism has had a long history of undermining democracy and hence public good.

It’s not even that Finland is an absolute perfect example of socialism any more than America is an absolute perfect example of capitalism. Rather, the point is that America strives toward a more capitalist worldview and Finland strives toward a more socialist worldview. Two different strivings leading to two very different results.

By the way, if you want to see where children get the best public education in America, just look at the states with high percentages of Scandinavian ethnicities. For example, check out the education data on the Upper Midwest; and while your at it look at the history of culture and politics. In America, the stronghold of democratic-socialism/social-democracy along with progressivism has always been the Upper Midwest.

“The governments of Norway and Finland own financial assets equal to 330 percent and 130 percent of each country’s respective GDP. In the US, the same figure is just 26 percent.

“Much of this money is tied up in diversified wealth funds, which some would object to as not counting as real state ownership. I disagree with the claim that wealth funds are not really state ownership, but the observation that Nordic countries feature high levels of state ownership does not turn upon this quibble.

“State-owned enterprises (SOEs), defined as commercial enterprises in which the state has a controlling stake or large minority stake, are also far more prevalent in the Nordic countries. In 2012, the value of Norwegian SOEs was equal to 87.9 percent of the country’s GDP. For Finland, that figure was 52.3 percent. In the US, it was not even 1 percent.

“Some of these SOEs are businesses often run by states: a postal service, a public broadcasting channel, an Alcohol retail monopoly. But others are just normal businesses typically associated with the private sector.

“In Finland, where I know the situation the best, there are 64 state-owned enterprises, including one called Solidium that operates as a holding company for the government’s minority stake in 13 of the companies.

“The Finnish state-owned enterprises include an airliner called Finnair; a wine and spirits maker called Altia; a marketing communications company called Nordic Morning; a large construction and engineering company called VR; and an $8.8 billion oil company called Neste.”

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What Americans Keep Ignoring About Finland’s School Success
by Anu Partanent

“Since the 1980s, the main driver of Finnish education policy has been the idea that every child should have exactly the same opportunity to learn, regardless of family background, income, or geographic location. Education has been seen first and foremost not as a way to produce star performers, but as an instrument to even out social inequality.

“In the Finnish view, as Sahlberg describes it, this means that schools should be healthy, safe environments for children. This starts with the basics. Finland offers all pupils free school meals, easy access to health care, psychological counseling, and individualized student guidance.

“In fact, since academic excellence wasn’t a particular priority on the Finnish to-do list, when Finland’s students scored so high on the first PISA survey in 2001, many Finns thought the results must be a mistake. But subsequent PISA tests confirmed that Finland — unlike, say, very similar countries such as Norway — was producing academic excellence through its particular policy focus on equity.

“That this point is almost always ignored or brushed aside in the U.S. seems especially poignant at the moment, after the financial crisis and Occupy Wall Street movement have brought the problems of inequality in America into such sharp focus. The chasm between those who can afford $35,000 in tuition per child per year — or even just the price of a house in a good public school district — and the other “99 percent” is painfully plain to see.”

“Pasi Sahlberg goes out of his way to emphasize that his book Finnish Lessons is not meant as a how-to guide for fixing the education systems of other countries. All countries are different, and as many Americans point out, Finland is a small nation with a much more homogeneous population than the United States.

“Yet Sahlberg doesn’t think that questions of size or homogeneity should give Americans reason to dismiss the Finnish example. Finland is a relatively homogeneous country — as of 2010, just 4.6 percent of Finnish residents had been born in another country, compared with 12.7 percent in the United States. But the number of foreign-born residents in Finland doubled during the decade leading up to 2010, and the country didn’t lose its edge in education. Immigrants tended to concentrate in certain areas, causing some schools to become much more mixed than others, yet there has not been much change in the remarkable lack of variation between Finnish schools in the PISA surveys across the same period.

“Samuel Abrams, a visiting scholar at Columbia University’s Teachers College, has addressed the effects of size and homogeneity on a nation’s education performance by comparing Finland with another Nordic country: Norway. Like Finland, Norway is small and not especially diverse overall, but unlike Finland it has taken an approach to education that is more American than Finnish. The result? Mediocre performance in the PISA survey. Educational policy, Abrams suggests, is probably more important to the success of a country’s school system than the nation’s size or ethnic makeup.

“Indeed, Finland’s population of 5.4 million can be compared to many an American state — after all, most American education is managed at the state level. According to the Migration Policy Institute, a research organization in Washington, there were18 states in the U.S. in 2010 with an identical or significantly smaller percentage of foreign-born residents than Finland.

“What’s more, despite their many differences, Finland and the U.S. have an educational goal in common. When Finnish policymakers decided to reform the country’s education system in the 1970s, they did so because they realized that to be competitive, Finland couldn’t rely on manufacturing or its scant natural resources and instead had to invest in a knowledge-based economy.

“With America’s manufacturing industries now in decline, the goal of educational policy in the U.S. — as articulated by most everyone from President Obama on down — is to preserve American competitiveness by doing the same thing. Finland’s experience suggests that to win at that game, a country has to prepare not just some of its population well, but all of its population well, for the new economy. To possess some of the best schools in the world might still not be good enough if there are children being left behind.

“Is that an impossible goal? Sahlberg says that while his book isn’t meant to be a how-to manual, it is meant to be a “pamphlet of hope.”

“”When President Kennedy was making his appeal for advancing American science and technology by putting a man on the moon by the end of the 1960’s, many said it couldn’t be done,” Sahlberg said during his visit to New York. “But he had a dream. Just like Martin Luther King a few years later had a dream. Those dreams came true. Finland’s dream was that we want to have a good public education for every child regardless of where they go to school or what kind of families they come from, and many even in Finland said it couldn’t be done.”

“Clearly, many were wrong. It is possible to create equality. And perhaps even more important — as a challenge to the American way of thinking about education reform — Finland’s experience shows that it is possible to achieve excellence by focusing not on competition, but on cooperation, and not on choice, but on equity.

“The problem facing education in America isn’t the ethnic diversity of the population but the economic inequality of society, and this is precisely the problem that Finnish education reform addressed. More equity at home might just be what America needs to be more competitive abroad.”

No, Finland Is Not a “Capitalist Paradise”
by Matt Bruenig

For starters, the Finnish government owns nearly one-third of the nation’s wealth. For the United States to match that amount, the US government would need to move about $35 trillion of assets into public ownership.

The Finns also have a large public sector, meaning that it’s not just wealth that is much more socialized but also production. Around one-fourth of Finnish workers are employed in general government services like child care, education, and health care. Another 7 percent are employed in state-owned enterprises like the country’s nationalized airliner, Finnair.

The United States would need to shift 24.7 million workers out of the private sector and into the public sector to match Finland. It would also need to expand its state-owned enterprise portfolio beyond the postal service, Amtrak, and the Tennessee Valley Authority to include things like American Airlines, Exxon Mobil, and Verizon.

Outside of the explicitly socialized areas of public ownership and public production, Finland also has a large and powerful labor movement that clearly gives Finnish workers significant power over the economy. Around 90 percent of Finnish workers are covered by a union contract. To get America up to Finnish levels, it would need to unionize an additional 119 million workers.

As we learned a couple of weeks ago, unionized Finns are not mere paper members either. In November, as a response to 700 postal workers receiving a pay cut, as many as 60,000 workers (in a nation of 2.2 million workers) went out on strike in solidarity, shutting down ports, railroads, buses, and airlines. The pay cuts were cancelled, and the prime minister resigned after misleading the public about the matter. Another 100,000 Finnish workers are expected to go on strike this week, causing production losses of hundreds of millions of euros, as part of contract negotiations in the industrial sector.

None of this is to say that Finland is a full-blown socialist society, whatever that might look like. It definitely could and should be more socialized and left wing than it is. But in saying this, we should not lose sight of how different Finland really is from the United States. To match the Finnish economic model, the United States would need to not only build a social-democratic welfare state, but also socialize $35 trillion of assets, unionize 120 million workers, and move 25 million workers into the public sector.

Class Struggle Built the Finnish Welfare State
by Tatu Ahponen

Is Finland more capitalist than socialist?

Partanen and Corson aren’t entirely off base. If by socialism we mean the state socialism of the Soviet Union, it would be silly to call Finland socialist. The Nordic business sector is alive and well, as are electoral democracy and the press. Nor can we say that the Nordic countries have achieved democratic socialism. While unions are strong and the public sector accounts for a much larger share of the economy, it’s not as if workers own and control the means of production.

Finland and the United States are both mixed systems, with doses of socialism and capitalism. Yet Finland is clearly more socialistic than the United States. […]

Partanen and Corson express shock that the Freedom House think tank rates Finland as freer than the United States, apparently associating lack of corruption and ease of bureaucracy with capitalism instead of socialism. But this assumes that graft and red tape are inherent to more socialist systems — and that their absence indicates a pro-business regime. Surely any self-respecting socialist would look at things like public ownership and union density as clearer indices of the “level of socialism” in a society than the existence of a private sector.

Crucially, the authors also get the history of the Finnish welfare state wrong. The pair acknowledges the role of the socialist left in Finnish history, but they also underplay it — noting Finland’s failed socialist revolution and the recent weakness of the Finnish left. Yet during the most active phrase of the welfare state’s construction, the Left was considerably stronger, with the Social Democrats and the Finnish People’s Democratic League (effectively the Communist Party of Finland’s electoral organization), often claiming about half of the country’s MPs.

Most important was labor militancy. So strong is the country’s history of strikes, in fact, that the recent walkouts — which brought out 60,000–100,000 people and triggered the fall of a government — were mostly taken in a stride: that’s what unions do, they go on strikes. And even those strikes were small compared to the great walkouts of yesteryear, including the general strike of 1956 (involving half a million workers) and a ten-day metalworkers’ strike in 1950, both of which demonstrated the labor movement’s potency and forced major concessions from capital. Finnish capitalists ultimately agreed to annual national negotiations that set the wages for all union workers.

The collective agreements were just one of the fruits of the decade from 1966 to 1976, the fastest stretch of development for the Finnish welfare state. A huge swath of the programs considered essential to the welfare state were passed during this period: universal elementary education, minimum pensions for families, universal day care, laws on occupational health and safety, and countless others. All were won through constant pressure from the labor movement and socialist parties, whether inside or outside the government.