Cooperation & Competition - A Nordic Balance

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As a young adult Friend I was greatly influenced by Elise and Kenneth Boulding, long-time members of Boulder Meeting. I remember Kenneth mentioning, with a twinkle in his eye, “Boulding’s First Law.” (Kenneth made his living as an economist.) “Whatever has happened,” he told me, “is possible.”

That attitude motivated me, while teaching at Swarthmore College, to research Denmark, Iceland, Norway, and Sweden. All four countries have moved from massive poverty a century ago to a virtual absence of poverty today, even though only Norway has struck it rich in oil. That has happened. I wanted to learn what made it possible. I wanted to learn how these countries compiled a half-century track record of shared prosperity, reaching the top of the international charts for individual freedom and economic equality. I wanted to learn what their experiences say about what is possible in the U.S.

One of my first questions was whether the difference in scale between the Nordics and the U.S. would reduce the Nordics’ relevance to our country. However, on my way into an Oslo conference room to interview a team of Norwegian economists, I saw a framed photograph of a Chinese delegation meeting with those same economists. So I asked those Norwegians about that visit. Not only is China the most populous nation in the world, but it also contains substantial cultural diversity. I asked my hosts about the issues of scale and homogeneity – how relevant is the Norwegian experience to the Chinese economy? The Norwegians told me they had discussed those same questions directly with their Chinese guests. The Chinese economists and policy experts were clear that sometimes scale matters and sometimes not – it depends on the task. They were convinced that China has much to learn from Norway. So I am convinced similarly that the U.S. has much to learn from Norway and the other Nordic nations.

As in U.S. culture, Nordic culture emphasizes the values of equality and individual freedom. The Nordics also place a high value on solidarity. When contradictions arise among values, Nordics search for innovations to resolve the contradictions. This culture creates a fertile ground both for entrepreneurs and for co-ops.

Norwegians have more start-ups per capita than we do in the U.S. They see the entrepreneurial spirit as an expression of individual freedom, and also as a generator of innovation, productivity, and wealth for the whole society. Norway’s seven universities collaborate to support start-ups, and training programs maximize the opportunity for recent immigrants to join the fray.

I learned why more Norwegians than Americans, percentage-wise, take the risk of starting their own businesses. They are not held back by many worries common in the U.S. They don’t have to worry about: sending their children to college (higher education is free), retirement (pensions for all), medical expenses (“Medicare for All”), or paying off their student debts (oh, right, higher education is free). When Inc. Magazine’s senior editor Max Chafkin went to Norway to interview entrepreneurs, his resulting article was called, “In Norway, Start-ups Say Ja to Socialism.”

At the same time, co-ops are a vital part of the Nordics’ economies. Co-ops are central to agriculture, not to mention the famous Norwegian fishing industry. The people of Denmark get 97% of their milk from co-ops. Swedish co-ops make tires, earthenware, even plastics. Half of adult Norwegians are co-op members, and many of those belong to more than one co-op. These examples don’t even touch on the important roles co-ops play in banking and housing.

I call this design “Viking economics,” a design that puts entrepreneurs and co-ops side-by-side. Both make vital contributions to the common good, and accordingly, both are supported by and regulated by highly democratic governments accountable to the people.

It was not always thus. A century ago, all four countries were more similar to the U.S. than they are today. Their governing bodies (in their case, parliaments) appeared to be controlled through free elections, while in reality, were controlled by economic elites. At that time, the majority of Nordics distrusted their governments, because those governments sided with the elites. Eventually, the majority organized a power shift, and freed themselves to invent the Nordic economic model they have today. However, the different countries’ paths forward were uneven.

By the 1970s, Sweden and Norway had replaced undemocratic, poverty-stricken, elite-driven systems with egalitarian, prosperous societies that offered more individual freedom than people experienced in the U.S. Then the urge to compete overwhelmed the urge to protect the common good. In the 1980s, Sweden and Norway flirted with neo-liberalism and de-regulated their banks. The bankers went wild and created a bubble. The bubble burst in the early 1990s, and the economies of both nations headed for the cliff.

Governments stepped in, seized the major banks, fired senior management, and dismissed the stockholders without a krone. Other banks were told they would need to re-capitalize somehow or go bankrupt. The bottom line was clear: the taxpayers would not bail out the banks; they would not reward dangerous and irresponsible behavior.

Both countries bounced back in record time. When 2007-08 offered a replay of financial crisis – this time in the U.S. and other European countries – the Swedish and Norwegian banks were not endangered. They had already been cleaned up and remained well regulated.

Iceland, on the other hand, was one of those countries that remained de-regulated. In the early 2000s, it experienced a financial boom, based on a financial bubble. Iceland ignored the previous examples of ill-fated neo-liberal adventures in Sweden and Norway. Thorvaldur Gylfason, one of Iceland’s leading economists, told me that not once did he hear anyone in Iceland talk about those disasters. The Wall Street Journal reinforced the Icelanders’ delusion when it told its readers about “the greatest success story in the world” and called it “Miracle on Iceland.”

Iceland’s 2008 collapse was so severe that the monetary system failed completely. People could not even get money from ATM’s! The people rose up nonviolently, threw out their government, and put the bankers on trial. Emboldened by its people in the streets in the country’s freezing winter, the Icelandic government negotiated so firmly with the International Monetary Fund that it gained an exception to the IMF’s usual austerity prescription. Refusing the IMF’s demand to reduce taxes on the rich and increase taxes on working families, Iceland’s government insisted on strengthening the social safety net and keeping families in their homes, even when mortgage payments were missed.

Because Iceland returned to the Nordic model that puts people ahead of profits, its economy bounced back from one of the worst financial disasters in history. To date, it has bounced back more fully than either the U.S. or the United Kingdom.

Three of the Nordic countries – Sweden, Norway, and Iceland – temporarily strayed from their central mission of serving the common good when they unleashed their competitive bankers. Denmark escaped that fate. In 1986, the Danish economic elite pushed the government toward neo-liberalism, but the trade union movement pushed back. Workers initiated a campaign of massive strikes and occupations, which prevented the government from making competition the dominant force in Denmark. The result: the Danes retained the Nordic model that carefully balances competition and cooperation.

Such national balancing resonates with the human and spiritual side of balancing: For example, my younger daughter Ingrid came to me at age fourteen with an inner conflict. She wanted to join the swim team in her school, but she was also inspired by her feminist Quakerism and felt afraid that her competitive spirit would get out of hand. We talked, and she joined the swim team. I attended her meets and saw the joy she found there.

Now Ingrid is a leader of Earth Quaker Action Team (EQAT), which engages in campaigns to force corporations to do the right thing in relation to economic justice and the climate crisis. We EQAT members count on what Ingrid calls her “warrior energy” to lead us in confrontational moments when we’re surrounded by security guards and police; we think she channels George Fox and Lucretia Mott, two of the many legendary Quaker nonviolent warriors.

Like the Nordics, EQAT likes to make the most of the diversity of gifts among us, to support us in pursuing the ends we value most. Within EQAT, we support healers, team-builders, researchers, charismatic ministers, leaders, followers – and warriors. All are essential to our mission, which is assertive, faith-based campaigning that insists that corporations stop hurting people and the planet.

The Nordic nations likewise have a mission to support the well-being of their people and the planet. To do that well, they need to say “Yes” to the diversity of skills and gifts that show up, including the cooperators and the competitors, including the warrior spirits. Holding those in balance is not easy.

George Fox was a warrior spirit. He so often attracted soldiers to himself when he spoke in village squares that he was offered a commission in the army. Soldiers seemed to feel an intuitive affinity toward him. Fortunately, Fox knew a better way to fight and called it “the Lamb’s war.” By this, he meant nonviolent struggle that allows for – even invites – God’s spirit to lead us in the midst of confrontation. In EQAT actions we experience this; one elderly Friend declared, after participating in her first action with EQAT, that it was one of the best worship experiences she could recall.

Nonviolent struggle opened up the social space necessary for Nordic countries to invent their Viking economics. In Sweden and Norway, troops were called out repeatedly to put down the people’s struggle until finally, in the 1930s, the economic elite finally gave up their resistance and followed the people toward a better way. New Swedish and Norwegian political parties – ones that represented workers, small farmers, and middle class allies – took over the governments. Those parties led their countries during the following decades that it took to transform oppression into new societies that affirm equality and individual freedom.

According to pollsters, large majorities of Americans say they want more equality and other features that exist in the Nordic model, including strong measures to address the climate crisis. To install an economic model of “right relationship with competition” in the U.S., it seems necessary to do what the Nordics did: go into the streets and allow our F/friends with warrior spirits to lead us. The current U.S. political system is not up to the task. Indeed, it is broken. Even a recent study coming out of Princeton University found that our country has long ceased to be a democracy.

Martin Luther King Jr. and many others have shown us that it is possible to take on opponents as intransigent as the Ku Klux Klan – and to take on government resistance at local, state, and national levels – in order to make bold strides for justice. New scholarship backs up the efficacy of nonviolent struggle against odds that appear to be overwhelming. Perhaps we once again need Kenneth Boulding’s reminder: “Whatever has happened, is possible.”  ~~~

George Lakey is author of Viking Economics: How the Scandinavians got it right and how we can, too. (2016) He is a member of Philadelphia Yearly Meeting and has taught at Pendle Hill and Woodbrooke. While at Swarthmore, he led students to create the web-based Global Nonviolent Action Database, which now describes over eleven hundred nonviolent campaigns from two hundred countries.