Why Does Socialism Only Work in Cold Climates?

DISCLAIMER: Billy Riggs does not speak on (or even address) this topic in any of his public presentations, but his interests are wide and varied so he sometimes uses this blog to express views he finds interesting or noteworthy.

“Capitalism has not always existed in the world, and it will not always exist in the world,” averred Alexandria Ocasio-Cortez, the newly-minted congressional nominee from New York’s 14th District, on PBS’ Frontline in July of 2018. Her eye-popping victory over of a 10-time mainstream Democrat in the primary heralded a resurgence of self-described socialists in the US, suggesting that Bernie Sanders’ strong showing in the presidential primary two years ago may not have been an anomalous one-off. Ocasio-Cortez is a nice, vivacious and sincere 28-year old girl and I hesitate to mock her for her naiveté (I was pretty naïve and clueless at that age, too.), but her electoral success has me wondering anew why no one ever asks the obvious question: why has Socialism never worked south of the 50th parallel?

            Socialists constantly cite Norway, Sweden, Finland, Denmark, Iceland, and Canada as proof that their model works. Haven’t they ever noticed what all of these nations have in common?

All of the “Socialist Six” have four things in common.

First they’re very cold, inaccessible places. All of the “Socialist Six” countries are situated entirely above 49 degrees North Latitude. Moreover, all but Denmark extend partially inside the Arctic Circle. That harsh climate is at least partially responsible for breeding a hardy and hardworking people who must have relied heavily on one another in close-knit communities to survive over many centuries. Even in the USA, the most stable socialist-leaning states (Oregon, Minnesota, and Vermont) are far north, buttressing this curious correlation. Similar attempts in California, for example, have created the highest poverty rate and the largest gap between rich and poor in the nation. The strong cultural work ethic of the most-heralded socialist nations is evident in the fact that usage of government handouts has been remarkably low in these countries until recently. Of course, being Santa’s neighbor doesn’t guarantee success. East Germany, the USSR and North Korea stand as monuments to the spectacular failure of some northern leftist economies. Ireland is nearly bankrupt even as England struggles. Most of Europe is finding it quite difficult to thrive under the weight of the nanny state even though the US has heavily subsidized their defense and always provided preferential treatment for them as trade partners.

Meanwhile, some of the greatest government catastrophes in recent history have resulted while attempting to implement socialist economic systems in warmer climates. Venezuela, reduced from one of the most robust economies in Central or South America to desperation in just 15 years, is only the most recent example. Nicaragua, Cambodia, Cuba, Ethiopia, and Angola have also been spectacular Socialist/Communist failures. The average latitude of those countries is about 13 degrees, roughly 2500 miles south of the southernmost border of the Socialist Six.

The reason the vaunted socialist successes are all so far north is because they enjoy a huge buffer between themselves and third world countries and will thus be among the last to be overrun by poor immigrants who do not share their value system. Not only do refugees have to pass through other more-hospitable countries en route to these remote destinations, the frigid climate in the far north makes them less likely to seek out new homes there. Why buy a ticket to frigid Iceland when you can more easily, quickly and cheaply make your way to balmy Italy? However, as more and more poor immigrants make their way to these isolated northern countries, I predict that the socialist model will become unsustainable, beginning with Denmark and Sweden, the most accessible of the six.

Secondly, they’re sparsely populated. – Canada is roughly the same size as the United States, but with 10% of our population. The other five socialist nations combined have only about 25 million citizens, roughly the population of Mexico City. Denmark boasts the highest population density of all of these putative success stories, but still ranks a relatively low 88th among the nations of the world by that metric. If you include Greenland (a part of the Danish kingdom), Denmark’s population density plummets to the lowest on Earth. Sweden, Norway, Finland, Canada and Iceland register 193, 203, 204, 222 and 226 (out of 232 countries and territories globally), respectively, on the same scale. Stated another way, each of these countries possesses a vast quantity of natural resources (on a per citizen basis) that may be sold to create the illusion that a socialist economic system works. Tiny Denmark (about the size of West Virginia minus its panhandle) nevertheless ranks as the 37th largest export nation in the world. This is not, I suspect, because of a vibrant economy but because of the quantity of natural resources available to each citizen proportionally.  Norway, Sweden and Finland export massive amounts of oil. It’s not really socialism in any academic sense. It’s just what I call “oil for sloth.” Mining and seafood account for the sustainability of Iceland’s minuscule population. When evaluating socialism, one must take into account the fact that anyone can sustain a life of leisure if they own plenty of land with enough oil, ore, usable pasture, or fertile soil that can be sold, rented or exploited. This makes free college tuition and health care affordable for them, but could never work in a country with the population size and density of the U.S., let alone in poorer countries.

            Suppose you bought 10 acres and discovered oil there. You could live a life of ease off the profits and never work another day. But then you marry and that single oil well still supports you both to the point that neither of you must work. Three kids are added to the family and the resources are stretched a bit, but none of them need get a job as they grow up. Then your adult kids marry and have children of their own. Eventually, the pie must be sliced thinner and thinner because the pie, itself, never grows. Moreover, the kids who grew up without a work ethic are unable or unwilling to get jobs to supplement the income provided by the well. Worse still, the pump eventually breaks down and needs maintenance, but by now so many people depend on the income it provides for life’s most basic necessities that the repairs can’t be afforded. Its output dwindles and then ceases, leaving hungry, lazy brats to fight over what’s left. This is the unavoidable lifecycle of any socialist enterprise.

Thirdly, all of them possess a Judaeo-Christian heritage.  Even though all six socialist nations could today be characterized as post-Christian, it is the second half of that term that is likely responsible for their success. Those who dwell in them have for centuries possessed a strong belief in the responsibility of every citizen to be honest, pull his or her own weight, and abide by the law. Note that socialism has never worked in a single nation where the predominant religion is (or was) anything but Christian. That can’t be a coincidence. These cultures were all built on a foundation of morality and law. When citizens trust one another, a host of economic benefits are reaped. There is little need for security systems, car alarms, bicycle locks, police forces, identity protection, guns, guards, etc. The crime rate in these nations has until recently been remarkably low, but will almost certainly continue to rise as immigrants who do not possess the Nordic penchant for law and order flood in. In fact, it’s already happened. In 2015, police in Norway’s capital city declared, “Oslo is lost” (hat tip to Carol Brown). According to one news report, the historic capital resembles “Karachi, Basra and Mogadishu all rolled into one.” Muslims there are already pushing for the suburb of Gronland to become a part of the Islamic State caliphate.

Finally, they’re not really socialist at all. None of the Socialist Six countries has a minimum wage, and all are passionately committed to school choice. The Heritage Foundation’s 2018 Index of Economic Freedom (a strong measure of capitalistic instincts) ranks Canada and Denmark ahead of the United States, with all but Norway ranking in the top 25 out of 195 nations worldwide. Norway comes in 31st, so all six are among the top 15% in capitalist leanings, and place higher than renowned capitalist havens South Korea (32nd) and Japan (39th). Their governments own no businesses at all. Taxes on corporations and capital gains in Sweden are much lower than in the United States. Their Welfare State is funded by consumption taxes, which allows citizens the freedom to alter how much they pay in taxes by adjusting their spending. Furthermore, Sweden’s great wealth was achieved decades ago in a low-tax, heavily capitalist environment. Her “socialist” reforms took place in the 70s and slowed the economy so markedly that they are now rolling back tax rates and and tightening government handouts while privatizing parts of healthcare and education. In Denmark, the average national tax rate is an astonishingly-low 3.76% and the top income-tax bracket is 15% (even after the Trump tax cuts, ours is 22%). Taxes are indeed quite high in those countries, but only at the local level. Small communities levee a heavy tax burden on their citizens, but the money is invested locally in schools, parks, healthcare and infrastructure rather than being sent off to Stockholm, Oslo or Copenhagen. In other words, the bulk of tax dollars are spent on the local citizens, not confiscated and spent hundreds of miles away. Far from a paradise of central planning, it is the absence of centralization that helps these countries work. How is this socialism?