Welfare: Norwegian Models

If you expected this post to be tall, blond, and fit... well, we'll examine the Norwegian welfare state nonetheless. It doesn't sound quite as sexy, but I assure you I will try to spice things up-- give you as much as I've learned, so you can, too. If it's still not up to expectations, well... imagination is a wonderful thing.

Unpacking the Norwegian welfare model is daunting, and I'll admit I'm inexact. Still, when it comes to Norway and the evolution of social welfare, a few things are important to keep in mind. Here's what you need to know:

1. Social welfare has a long history in Norway, but it really took off after World War II when there was great need and democratic political will to enact it.
2. Universal welfare models pre-date the Norwegian oil-boom. The world's largest sovereign wealth fund does not fund the world's most notorious social welfare regime. Individual tax contributions do.
3. There is political consensus on universal welfare. There is no debate in Norwegian politics (from far Left to far Right) on the existence of social welfare. There is much debate on its inclusiveness and the degree to which welfare services are privatized.
4. Norway's welfare model is based on universal rights. This means that all Norwegians are recognized as eligible for state assistance--whether that's unemployment benefits, pension, health care, etc. Some policies are targeted, but the majority are universal.

The biggest curiosity of the Norwegian welfare state is this: why would rational citizens agree to be taxed more to fund a system of universal social welfare? The answer is more complex than I can imagine, but the takeaway is the ideological difference between American and Norwegian welfare models.

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Norwegian welfare is all about increasing personal freedom (I know right?). Equality of all isn't the point-- which distinguishes these policies from far-Left, Communist ideals. Individual freedom to decide destiny (pursue happiness) is the goal of social welfare. The policies exist to liberate individuals from socially-imposed constraints and obstacles. Imagine if you could actually be anything you want to be-- with no concern for "that makes too little" or "people like me just don't do that." Such is the basic principle at work in the Norwegian context (as I understand it). Not much different from the USA, right? Locus of responsibility accounts for all the difference.

American and Norwegian models of social welfare both recognize risk in the pursuit of happiness. Sometimes things just don't work out. But the Norwegian model distinguishes between two types of risk: private and collective.

Private risk measures variation in what we are responsible for as individuals. Things like working hard, taking the job, arriving on time, packing the lunch, etc. If I fail because I fail to be responsible for one or many of these things, it is more justifiably "my fault" that I'm in the situation I'm in, and I should bear the cost. But, contrary to the US model, not all risk is private.

Sometimes social institutions bigger than individuals can affect the individual pursuit of happiness. Variation in achieving what makes us happy can be due to things we can't change, like our race, gender, ethnicity, educational opportunities, etc. It can also be due to economic cycles which are surely beyond our responsibility. The Norwegian model is sensitive to such risk factors, and it is a system which has democratically decided that the individual should not bear the cost of collective, social irresponsibility.

Combating collective risk in the pursuit of happiness is achieved by bestowing universal, civil and political rights. These rights set a standard (for the financiers, diversifies the collective risk through investments in universal healthcare, education, employment, etc.). Rigorous definitions of rights and individual responsibilities demarcates the expectations and benefits of being Norwegian. That is the central concept of Norwegian social welfare.

*Aside*: measuring success of social welfare is simple. First, Norway measures if people are pursuing their destiny (e.g. employment). Second, Norway measures if the collective risk is fully diversified (e.g. inequality). To clarify, the goal is not full equality, but to eliminate as many factors as contribute to stifling individual freedom.