Contrary to popular belief, Nordic countries aren’t actually socialist! No, friends, the Nords are capitalists—but they pull it off much better than we do. To help re-imagine American capitalism, writers Anu Partanen and Trevor Corson join us this week all the way from Finland.

Anu Partanen is a journalist and the author of The Nordic Theory of Everything. The book debunks some of the most common myths about Nordic societies and discusses what the United States might be able to borrow from aspects of Nordic success in the twenty-first century. She has written for The New York Times and The Atlantic.

Twitter: @anupartanen

Trevor Corson is an award-winning author and editor. His articles and essays have appeared in The New York Times, The Wall Street Journal, The Atlantic, and many more.

Twitter: @TrevorCorson

Further reading:

The Nordic Theory of Everything: https://www.indiebound.org/book/9780062316547

Finland Is a Capitalist Paradise: https://www.nytimes.com/2019/12/07/opinion/sunday/finland-socialism-capitalism.html

What Americans Don’t Get About Nordic Countries: https://www.theatlantic.com/politics/archive/2016/03/bernie-sanders-nordic-countries/473385/

Capitalism Redefined: https://democracyjournal.org/magazine/31/capitalism-redefined/

Safe, happy and free: does Finland have all the answers? https://www.theguardian.com/world/2018/feb/12/safe-happy-and-free-does-finland-have-all-the-answers

Make sure you check out Majority.FM’s AM Quickie, the morning news podcast for progressives in the know: amquickie.com

Website: http://pitchforkeconomics.com/

Twitter: @PitchforkEcon

Instagram: @pitchforkeconomics

Nick’s twitter: @NickHanauer

 

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Anu Partanen:

One of the things that a Nordic person I think notices quickly when you come to America how much Americans talk about freedom. But the longer I live in the United States and the more I observed the life around me, it didn’t seem to me that Americans were actually that free.

David Goldstein:

I look at the Finnish model and I say, “Free healthcare, free daycare, good public schools, free college, and long-term care when you get old?” That’s the type of market capitalism for me.

Nick Hanauer:

And none of these things are out of reach for Americans.

Speaker 5:

From the offices of Civic Ventures in downtown Seattle, this is Pitchfork Economics with Nick Hanauer. A pointed conversation about who gets what and why, with one of America’s most provocative capitalist.

Nick Hanauer:

I’m Nick Hanauer, founder of Civic Ventures.

David Goldstein:

I’m David Goldstein, senior fellow at Civic Ventures. So, Nick, back in … Oh, was it like May of 2014 when you first had me into the office to talk about working with you?

Nick Hanauer:

Was it that long ago?

David Goldstein:

It was that long ago.

Nick Hanauer:

Good God.

David Goldstein:

You brought me on board. You explained it to me to help you with your mission to redefine capitalism.

Nick Hanauer:

Correct.

David Goldstein:

But when I talk to people about the stuff we’re working on and the things we support that we want some sort of universal healthcare for everybody. We want to raise wages. We want to tax the rich. We want a high minimum wage. We want high overtime protections. We want affordable housing. They tell me that that’s-

Nick Hanauer:

We’re advocating for a socialist hellscape.

David Goldstein:

Let’s tell the truth. Are you some sort of secret socialist?

Nick Hanauer:

It’s such an interesting question and it’s so pertinent today. But I think you raise a really good point because we’re not socialists. I’m certainly not a socialist and I really do strongly believe if the principal lesson of the 20th century was that markets work and non-market societies don’t. That there is no example on Planet Earth where a society moved away from markets and it succeeded in any sort of measurable way.

David Goldstein:

Right. But saying that markets work is not the same thing as saying our current market system works as well as it can.

Nick Hanauer:

Exactly, and I’ve said many times. Capitalism comes in as many flavors as pie and dirt pie tastes terrible and cherry pie tastes great and we-

David Goldstein:

Maybe you prefer a pecan pie?

Nick Hanauer:

Yeah, right. People are different but we definitely get to choose the form of market economy that we have and we have both the right and responsibility to choose a good form, a good flavor. But I do think it’s worth just pausing for a second reminding folks why we are so certain that socialism doesn’t work.

David Goldstein:

And let’s define this because this paucity of terms we have, it hurts us on both sides. It says there’s capitalism, this thing called capitalism which is markets and freedom, hurray, America first [crosstalk 00:04:01]. And that’s it. That’s the only kind of thing there is.

David Goldstein:

And then socialism where people lump in affordable healthcare with Stalinist death camps. Let’s make a technical distinction between socialism in the Soviet sense which is-

Nick Hanauer:

With the Venezuela sense.

David Goldstein:

… we think of it as a communist country where the state owns most of the means of production and there is no private property-

Nick Hanauer:

There are no markets.

David Goldstein:

Right. The state is setting all the prices and assigning all the wages and so forth. It’s complete top-down control. That’s not the same thing as a social democracy. A social welfare state, a mixed economy which is largely a market economy in which most industries, most businesses are privately held and privately run and there’s private property.

David Goldstein:

But there are some basic things like healthcare, education, not just K-12 but colleges and universities, daycare, things that are provided by the state often outside of the market and guaranteed to all citizens. That’s not socialism.

Nick Hanauer:

Honestly, by emphasizing the state-provided services as the distinction, we actually don’t acknowledge the important difference which is that a laissez faire market system basically can do nothing but eat itself. It will create massive economic inequality and will collapse from within.

Nick Hanauer:

And what other countries utilizing market systems have done as they have constrained the market systems in ways that both encourage into a certain extent guarantee that the outcomes will be distributionally reasonable, and therefore, more stable. And more to the point, where the outcomes of the market economy are not so egregiously unjust, that you have to spend a shit ton of government money making up the difference.

Nick Hanauer:

When I think about a market economy that make sense, I’m not thinking about an economy that mostly includes government provided services at scale, although I do agree that in many cases, this is the best and most efficient way to do it, like public education and almost certainly like healthcare to a certain extent. But what I do think of is a set of rules and norms governing the market economy to make it work in a way that works for everyone.

Nick Hanauer:

Our system actually isn’t capitalist, it’s socialism for the rich. There are some very clear ways in which socialism does not and cannot work to provide prosperity for human societies and that is, that while socialism is really good at solving the distributional problems in an economy but what that arrangement cannot do is create more prosperity.

David Goldstein:

At least not as well as the market.

Nick Hanauer:

Because markets are an incredibly effective way of generating new solutions to human problems.

David Goldstein:

As we’ve said before, that’s an evolutionary system that evolves new solutions to human problems.

Nick Hanauer:

Right, exactly.

David Goldstein:

So to sum this up, just for folks listening, if you’re one of those libertarians who hate government programs or you’re somebody who knows one of those libertarians that hates government programs, to be clear, Medicare for all is not socialism. If the US had Medicare for all, we would have a market economy with universal healthcare.

Nick Hanauer:

Correct.

David Goldstein:

So this brings us, of course, to the theme of this episode is … Well, we’re saying reimagining capitalism, making the case that there are different kinds of capitalism. And one of the places where there’s a different kind of capitalism that people in the US often like to say, “Oh, that’s socialism. You don’t want to go to that socialist hellhole,” is well, the Nordic countries.

Nick Hanauer:

That’s right. And one of the best examples of the Nordic countries is Finland. And today, we do get to chat with a couple of people who are calling us from that socialist hellscape-

David Goldstein:

But where oddly it’s warmer and sunnier than it is here in Seattle right now.

Nick Hanauer:

So today, we get to talk to Trevor Corson and Anu Partanen about what it’s like to live in Finland which parenthetically in 2017 was ranked the most stable, the safest, the best governed country in the world. It’s also the third wealthiest, the third least corrupt, and the second most socially progressive and finally, the third most socially just.

Nick Hanauer:

So somehow-

David Goldstein:

Somehow, not socialist hellhole as they wrote in The New York Times, Finland is a capitalist paradise.

Anu Partanen:

My name is Anu Partanen. I’m a writer and I’m the author of The Nordic Theory of Everything in Search of a Better Life which is book that compares the United States and the Nordic countries and what life looks like in these countries.

Trevor Corson:

And I’m Trevor Corson. I’m married to Anu Partanen, the most important thing you need to know about me. And I’m also an author. I have written for The New York Times, The Atlantic. I’ve written two books. I’m a science writer as well as a literary journalist and I have most recently been teaching American Studies and Writing at Columbia University in New York City where we lived for 10 years before we moved to Finland.

David Goldstein:

I’ve got a question right off the bat after reading your piece in The New York Times, how do I immigrate to Finland?

Anu Partanen:

I get that asked so much. Just today, I was talking to a group of American college students who are visiting Finland, and I met them here in Helsinki. And they were immediately asking me how to immigrate to Finland. And all I can say is, “Well, it’s not easy. Unfortunately, Finland is a little bit like other European countries. They don’t make it easy.”

Anu Partanen:

But for the students, luckily, I could tell them that a lot of Finnish universities these days have English language programs. And I think it’s reasonably easy to come here as a student. So they have hope.

David Goldstein:

How about as a political refugee, because we’ll see what happens in the 2020 election that I don’t know how welcome I’ll be afterwards.

Nick Hanauer:

So, we’re so delighted to get to talk to you guys. Our podcast as you know is devoted to all things economic and in particular, try to help people understand the ways in which sort of the American framework of economics and what we call neoliberalism in particular the ways in which that has imprisoned us and reduced our happiness and prosperity in all sorts of ways.

Nick Hanauer:

In particularly, the ideas that we take for granted sort of it’s the water we swim in that neoliberalism as a meaning system has infected every part of American life and most people, they don’t even recognize it’s there. But in particular, we were really drawn to the way in which you folks describe freedom, a different form of freedom.

David Goldstein:

I guess, the liberal in neoliberalism is from liberty. It’s all about making us free and maximizing personal freedom and liberty. And yet, you make the argument that actually the Finns are more free. Explain to the American audience why.

Anu Partanen:

Well, for my part, this is basically the whole lens that I look through into my book The Nordic Theory of Everything. And so the book started when I moved to the United States. I’m originally from Finland and I grew up in Finland, then I moved to the United States and I started looking at the American life around me and thinking about them and trying to figure out my own place in the society.

Anu Partanen:

And one of the things that are Nordic person, I think, notices quickly when you come to America how much Americans talk about freedom. And we don’t really talk about it that much here. And at first, it was strange to me. It seemed a little … I’ll be honest, it sounded a little pompous, because in the Nordic countries, we’re pretty … I don’t know if modest is the right word. But we don’t really use big words and so on.

Anu Partanen:

But the more I thought about it, the more I thought that that’s fantastic. Of course, freedom is what we all want from life. And every society should really aim for freedom. But I really started to appreciate the fact that Americans really are so engaged with it and talk about it so much. But then the contradiction was that the longer I lived in the United States and then the more I observed the life around me, it didn’t seem to me that Americans were actually that free, and it certainly didn’t seem to me that Americans were living a freer life, if you will, than the people I had known in the Nordic countries.

Anu Partanen:

And so that was the starting point of my book, and the basic idea that I came to. And when I was researching the book, I discovered was that the way the Nordic countries have created these universal social policies that provide every child, every person with good education or healthcare or parents with paid parental leaves and so on. These are not some sort of collective socialist systems that take the way your independence or a gift from the government.

Anu Partanen:

There are in fact services that really support everybody’s independence and freedom so that you’re free to actually fulfill your potential regardless of who you are parents are you’re free to have a family and career and you’re free to not worry about constantly how you’re going to pay for health insurance or whether it’s going to cover you.

Anu Partanen:

So that was one of the big discoveries for me when I moved to the United States to realize that there’s many ways of achieving freedom. And I think today, the United States, the way the society is organized doesn’t actually really support people’s freedom every day.

David Goldstein:

We’re free in theory.

Nick Hanauer:

Yeah. And our definition of freedom is freedom from constraint. But what you’re really talking about is a different and I think in our opinion, much better definition of freedom which is capabilities. It’s well and fine to be theoretically free of constraint. But if you live in a libertarian hellscape where the only people in the society who have power are small group of economic elites and your life essentially is constrained by that and you’re consigned to a life of limits and poverty, you’re not super free, right?

David Goldstein:

I think that make a distinct-

Anu Partanen:

I think absolutely.

David Goldstein:

Make a distinction, you and I are equally free to fly on a private jet. The difference is you’re at liberty to fly on a private jet and I only get to fly on it if you invite me on your jet. And that sounds like an odd sort of situation but throughout our lives, you have more liberty than I do because you have money.

David Goldstein:

I’m curious, Trevor, your take as an American in Finland, is your impression the same?

Trevor Corson:

Well, I was one of those fish swimming in the sea of American’s version of freedom not knowing what I was missing. And meeting Anu and learning about her thinking has really dramatically changed the way I perceived how my life was in the United States even while we were still living there. We lived there for 10 years together before just moving to Finland recently.

Trevor Corson:

She has this line in her book where she says, “One of the ways to think about this is that the freedom you have in Finland, for example, or any country that has good public social services is freedom from false hope,” which I think is such an interesting way to phrase it because in the US, I am from a very privileged background. And yet the social set that I’m part of, even of those people and myself included, suffer from really debilitating stresses and anxieties all the time.

Trevor Corson:

And even if it’s the fear that your kids are not going to get into the right high-end private school, the whole set of things behind that is that we lack like any kind of middle class anymore with a decent life where people can have the freedom to live the life they want to. Instead we’re all in this pressure cooker trying to compete, trying to-

Nick Hanauer:

In arms race.

Trevor Corson:

… keep our head above water. It’s an arms race, yeah. And the false hope part is that there’s this huge industry of self-help and everybody is constantly just trying to find the way that they can calm down and relax whether it’s meditation or yoga or mindfulness. And that’s not the problem. It was part of solutions. I mean maybe they help, but the false hope that we all suffer from and not to mention people who are far less privileged-

Nick Hanauer:

For sure.

Trevor Corson:

… that we can rise above this against all odds, I mean, all these tails of heroism. And it’s so interesting now moving to Finland where people don’t talk and think about this stuff that much as Anu said. But from my perspective as an American looking for example at Anu’s Finnish friends here, something she’s pointed out too is they seem so relaxed and free compared to the equivalently positioned people that we know in the United States who are really stressed out all the time.

Trevor Corson:

And it’s not that their quality of life is battered, that they’re missing out on opportunity. They have good jobs. They have wonderful lives. They can compared to buy things. They’re just really relaxed and enjoying life.

Nick Hanauer:

And I think that, my own experience is that the more inequality there is in a society, the farther the rungs of the ladder of opportunity are stretched apart, and the more panicked people become about moving from rung to rung or moving down a rung.

David Goldstein:

Anu, in your book, you talk about the logistics of everyday life and the difference between making your way through life in America on a daily basis, how complicated and stressful it is as opposed to what it’s like in Finland. If you could provide an example, I think, the audience would appreciate that.

Anu Partanen:

Well, I think there’s just many things in your daily life especially if you have a family in the United States that are complicated and require you to do research and visits. And you just think of choosing a good daycare for your kid or choosing a good school for your kid.

Anu Partanen:

I was just amazed when I started to learn that Trevor’s family or friends that they would do so much research. They would ask around friends. They would visit multiple schools. They would interview the teachers and they would really stress out if whether they’re going to find this good school and can they trust that it’s a good school for their kid and then can they get it in and they’re filling out these paper works and taking part in lotteries.

Anu Partanen:

I remember a friend was … They were applying for a private school that they’re going to pay for a lot of money and still there was this system where you had to get your application in on a certain day and everybody is really stressed out that is the mail going to get it? Or do I have to take it in person?

Anu Partanen:

And all this just seemed to me that people have to spend so much time just figuring all these out and then they’re constantly stressed out about it. And then multiply this by researching your health insurance and researching college and filling out college applications. And I often thought that well this is really anxiety inducing because it’s also hard. Even if you’re highly educated person, you still struggle to fill in the forms or understand the healthcare bills or what not you get in America.

Anu Partanen:

So it’s complicated. It takes up your time. You’re really anxious about it, but I have some thought also like just the simple American truth that time is money. Like how much time every individual spends on this. People who could be doing something much more valuable with their time whether it’s just hanging out with their kids or going to a baseball game or working at the actual job and thinking about that.

Anu Partanen:

If we had a system where these basic things that everybody needs, everybody needs daycare for their child. Everybody needs a school for their child, everybody needs healthcare. If we just figure out a way where it’s taken care of for you and I feel like in a Nordic country, they certainly debate on how to best arrange these services and so on.

Anu Partanen:

But you can also make the argument that if you have a government that is specialized in figuring out how we were going to arrange the best healthcare system for all these people, then there’s going to be hired people who are specialized and they do that. And not every individual who doesn’t even understand the system.

Anu Partanen:

So that to me also seemed like it doesn’t make any sense that we force everybody to be stressed out and spent all these time and energy on these things.

David Goldstein:

What was the experience like finding daycare for your daughter in Finland?

Anu Partanen:

Well, you fill in an application. I don’t even remember anymore. I think it was so simple or maybe I send in an email and an application, and you kind of figure out the ones that are closest to your home or whatnot. You list them and then you get a letter saying which one your child get into. Every child has a right to a spot in a public daycare center in Finland, so it’s not a question of whether you get a spot.

Anu Partanen:

The play we got is like seven minutes from our home and it’s fantastic. It’s truly wonderful. They do so many things there and we’re constantly just amazed at what our daughter already learns there, what the days are like. Having said that, sure, some neighborhoods all of a sudden have a lot of kids and they don’t have enough daycare centers and so people get a spot further away and they’re unhappy because they have to-

Nick Hanauer:

Oh, no.

Anu Partanen:

… take the tram, exactly. And of course, it can be annoying but most people then, you apply next year again and maybe you get a spot closer to you. But it’s still extremely easy and we pay the maximum. For the whole country, again, maximum amount that anybody is allowed to be charged and it’s 280 euros at the moment or maybe 290 euros. So about $300.

Anu Partanen:

And then it’s still on a sliding scale that if you make less money, you pay less, but we are fortunate enough to be in the highest paying group and we pay 300 euros.

Nick Hanauer:

So there’s this quote that we grabbed from your book that I really loved that I think describes this, but pretty good at getting this notion of freedom, which is that the Nordic call has been to free the individual from all forms of dependency within the family and in civil society, the poor from charity, wives from husbands, adult children from parents and elderly parents from children.

Nick Hanauer:

The expressed purpose of this freedom is to allow of those human relationships to be unencumbered by ulterior motives and needs and that’s to be entire free, completely authentic and driven purely by love. I think it’s a wonderful way to express how useful these policies are for promoting true happiness and freedom and why that distinction, why the lives of people are so different and driven by these different policies.

David Goldstein:

But this is an economics podcast, so I’d love to get into some of the economics just so we can be clear. Your piece in The New York Times was titled Finland is a Capitalist’s Paradise. Let’s talk about the economy in Finland. It is a market economy fully, right?

Anu Partanen:

It is, yes. What is a market economy fully? It is in a sense that there’s private ownership, there’s private businesses, there’s free market. Finland’s economy is very exports-oriented, so Finland is very much part of the global trade and in fact, dependent on it. So you see less of the kind of movement towards trade wars or whatnot you see in the United States because I think Finland is a small country and is very focused on global trade. Everybody kind of agrees that global trade is a good thing.

Anu Partanen:

So it is certainly very much a free market economy. You have all the same brands. You can buy whatever you want, so it’s not all what many Americans might think that, “Oh, there are those, I don’t know, poor socialist countries who probably can’t buy Coke or whatnot.” But at the same time, so the basic difference is that we just have a government that provides some basic vital universal social services for everyone. And then apart from that, businesses do their thing and sell their products just like in America.

David Goldstein:

And the cost, what are you paying in taxes?

Anu Partanen:

Yeah, that’s a really interesting question. I think I often encounter that in America, many people still think that everybody in the Nordic country pays like 70% of their wages in taxes. And that’s not at all true, not at all. For me, one of the surprising things also was that when I moved to America, we lived in New York City. And in New York City, you have a federal tax, state tax, city tax. And for three years, I have to do my taxes both in Finland and in the United States, so I could actually see that with the same income, what my tax rate was. And it was basically the same.

Anu Partanen:

A few years, I would have paid a little bit less in Finland because let’s remember I wasn’t making huge amounts of money. So the difference really is that in America, if you’re a wealthy person making a lot of money, you probably pay less taxes than you would in Finland. Or if you live in the state like Texas or somewhere where you don’t necessarily have state tax or city tax, then maybe you pay less of your income in taxes. But overall in America, many people in big cities pay just as much of their wages and taxes as people in Finland do. So it’s not that the burden on individual is that much higher.

Anu Partanen:

Certainly in Finland, for example, consumption is taxed a little differently. So gas is more expensive in Finland or maybe some, I don’t know, a laptop might be more expensive in Finland. But that doesn’t mean that people can’t afford to buy these things. If you go to any house in Finland, people have their Macs or laptops or iPhones. So in that sense, it’s similar.

Anu Partanen:

But it’s just we all pay somehow. And Americans pay for health insurance on top of their taxes. They pay for daycare on top of their taxes. They pay for their college on top of their taxes. Whereas the way Nordic society in Finland is organized. We pay taxes and then we get the services in return. And I think for most people, that’s a better deal and I would argue that even for extremely wealthy people in the United States certainly probably end up paying less tax than they would in a Nordic country.

Anu Partanen:

I would say that the Nordic country style or model could be a better deal because, A, you’re kind of relieved of those pressures that we talked about earlier. You don’t have to spend all that time worrying whether their kid is getting into the best school or because if they don’t get into the best school, they’re going to fall down a ladder and then, oh, my god. So you can also live less stress-free life.

Anu Partanen:

And I’ll be honest that for me at least, I think it’s a selfish thing also to think that I want to live in a society where there’s not homeless people sleeping in the doorways or like these luxury stores that sell $5,000 handbags. And I just feel like I think most Nordic people even the wealthy people are happy to pay those taxes to feel like they live in a society that actually provides equality of opportunity for everyone.

Anu Partanen:

And then you can feel like, “Okay, I’ve earned my success.” Because one of the things I was surprised in America as well, there’s a lot of talk of privilege and a lot of people feeling kind of guilty about their privilege. And Finns don’t really talk about that much. Like of course in Finland too, some child is in better position than another one for sure. Maybe parents, sometimes they are alcoholics or whatnot, this happens always.

Anu Partanen:

But because the society overall works hard to provide equal opportunity for all children, then you don’t have to constantly feel like, “Oh, but I had such advantages growing up that actually my success maybe is not my success.”

David Goldstein:

So, I’m curious, Trevor, you came from New York, very cosmopolitan city, people from all over the world there. The US is not as homogenous as Finland. Do you think it could work here?

Trevor Corson:

A couple of things to say about that. One is that it’s a really interesting moment to be moving from New York to, say, a place like Finland because as an American, I really feel that, and I know you guys are thinking a lot about this question, of certain stories we’ve told ourselves as Americans over the past decades about if we raise taxes, it will ruin investment and wealth and growth and make life worse for everyone.

Trevor Corson:

And I think this is an incredibly interesting time to move to a Nordic country from the US because I’ve come to feel that the Nordic countries are the living, breathing proof that what we’ve been telling ourselves in the US is wrong. And the only reason we’ve been able to ignore the Nordic countries is because of all these talk about how they’re … Well, they’re these socialist nanny-states. They’re basically communist.

Trevor Corson:

And part of what we’ve been trying to say is like, no, actually they’re these quite cosmopolitan, very interesting capitalists that are doing really well using policies that we’re told can’t work. And capitalism has only done better here as a result.

Trevor Corson:

And on the homogeneity question, one thing to say is that Nordic countries are quite heterogeneous now. They’re more, I think, foreign born people in Sweden now than there are in the United States. And Helsinki, where we are, is rapidly becoming much more international just in the past 10 years. So I’m really excited to be living here right now.

Trevor Corson:

We hear this a lot that, “Oh, these Nordic countries are these homogenous white Christian monocultures and they’re all altruistic, and that’s the only reason it works and it would never work in the United States.” And there’s a couple of underlying assumptions there. One of them is that a white Christian monoculture contains no divisions between people or no disagreements.

Trevor Corson:

And one of the things we wanted to do in our article is tell the story of Finland’s history quickly because there was a terrible civil war, 35,000 people were killed. There was mass murder. Finns were slaughtering each other in the streets over economic injustice. And it’s the legacy of that, that has partly inspired the current system and the way it works. And there are constant disagreements in Finland politically between different political parties, between classes over this stuff. People here fight with each other and scream and yell at each other all the time.

Trevor Corson:

The idea that is these are somehow harmonious, altruistic society is a complete myth. And the reason it works is because people, they understand that their self-interest is built into having the system work even though people have disagreements. And so that’s one underlying assumption here that we need to examine. Another one is kind of an extension of that which is that you only by being altruistic or communitarian could we have a good public services, for example, could we have …

Trevor Corson:

No one will agree to it in the United States because nobody is that selfless. Everybody is more selfish in the United States. Well, the whole point here is that all these public services, for example, universal healthcare, universal good public schools, they’re incredibly much in everyone’s self-interest because as we’ve just been describing, our own personal lives are so much better as a result. We have a very selfish interest in wanting to live in this system.

Trevor Corson:

So it doesn’t require altruism. You actually get a better deal, a much better deal for your money whether it’s taxes or deductibles or premiums you’re paying to a private health insurance coverage. We’re spending far more money in United States as you well know than they did here. So it’s a better deal for selfish reasons.

Nick Hanauer:

It’s just much more efficient to solve these problems collectively then-

Trevor Corson:

The public schools, yeah, we have a young kid and we’re thinking about schools. And there’s an education expert that Anu quotes in her book who puts it really well. He said, “Oh, yeah. There’s school choice in Finland too. You can choose any public school you want. They’re all excellent,” end of story.

David Goldstein:

Do you know any business people? Have you talked to business people there about the benefits to business of, for example, not having to being in the health insurance business as every business in the US is?

Anu Partanen:

Well, from my book, I have one chapter on entrepreneurship and the basic idea of that chapter was that in the United States, I often would hear when I would talk about Nordic countries, people would say, “Well, that’s all good and well.” Sure, you have a good quality of life and it’s probably nice for all of you to have long paid summer vacations and paid parental leave.

Anu Partanen:

But that means that you don’t have any innovation. You don’t have successful businesses. Name one brand that comes from Nordic country which always was kind of funny to me because well, you got IKEA or H&M or Spotify or Skype or Minecraft or Angry Birds or all these things that Americans used that come from the Nordic countries but I think a lot of the Americans just don’t know they come from the Nordic countries.

Anu Partanen:

But the book chapter basically, I went around the Nordic countries and different countries talking to companies that are competing globally and successful, small and large, and asked them that, “Well, how is it possible that you have a successful company that’s competing at the American market while all your employees are constantly out of their paid parental leaves or their paid vacation, or you had to pay tax,” which is what Americans would ask that it’s not possible to run a profitable business.

Anu Partanen:

And what these HR directors or CEOs would just tell me that, “Look, it’s the job of the government to provide the basic infrastructures to make sure that we have a society where people can do their jobs and then the business can do what it does and then it’s the government’s rule to set reasonable boundaries and regulations so that the playing field is level.”

Anu Partanen:

But overall, I think people in the Nordic countries, everybody doesn’t agree but I think mostly businesses see the benefits of having the government to be in the business of providing health insurance.

Nick Hanauer:

Could you remind us what the paid vacation, paid family leave policies are in Finland?

Anu Partanen:

In Finland, the typical amount is five weeks of paid vacation for everyone regardless of who your employer is. It’s just universal mandated. It depends of course a little bit the first year, you get four weeks and so on but this is mandated. In Finland, parental leave, it’s about a little bit less than a year is paid based on your salary.

Anu Partanen:

So you get a certain percentage. It varies a little at first. It’s 90%, then it’s maybe 70% of your salary that you get throughout that time. And that’s available to both parents or either parents I should say, not both but either. They can choose it and divide it as they will. And then after that, you can still stay home without losing your job but then you just get a small stipend for another two years.

Anu Partanen:

Now, the big difference and good to remember is that this is also taxpayer funded. So it’s not the business. It’s not your employer who pays you salary for the whole time that you are on paid leave. All employers and all employees pay into basically, pay your tax into insurance fund if you will, and the money comes out of there.

Anu Partanen:

So for the employer, typically, they just been hire someone else to do the job for a year and they’re not stuck at paying two salaries, so that’s really important I think to remember. And small business of course, it’s also important that they’re not stuck at paying somebody’s salary while they’re away.

David Goldstein:

Wow. That sounds like a socialist hellscape. We have a question that we ask everybody we interview. And you can answer together or separately, why do you do the work you do?

Anu Partanen:

Well, I feel like as a writer, I want to try to find something that I can give to the world that I can provide. And for me right now or for the past several years, the fact that I have lived in the United States for 10 years, I’m now also American citizen and that I come from a Nordic country is something unique that I have, so that’s why I had chosen to put my efforts into writing and discussing and thinking about those differences.

Trevor Corson:

I guess I feel as an American, as someone who grew up in the US and has family and friends there, I’m just really worried about where we are headed. I think we are possibly headed for like very bad civil strife possibly.

Trevor Corson:

And what frustrates me about the conversation and a lot of the people I’m in touch with back in the US is how it’s so hard for us in the US to conceive of this kind of very sensible middle ground that we’re living as a reality here in Finland whereas in the US, we’re stuck with these narratives about freedom or communism basically.

Trevor Corson:

And the reality is everybody thinks that the mainstream in the US has to be centrist and is centrist and that’s the only really viable area. And having known Anu, I think I feel like I need to read her book at least once a year to keep like reminding myself of all the amazing insights about the US. But the idea that we’re centrist is nuts. We’re far to the right, and we’ve all become completely convinced that anything that’s good for anybody and that can help save our capitalist system in United States is some form of communism or something. It’s just ludicrous.

Trevor Corson:

And I feel so frustrated that I want to help try to do what little I can from our approach here in Finland right now to say, “Hey, everybody, wake up. Our American US system is really in danger, and we need new stories about how to understand who we are.” And I think Anu’s book does that and anything I can do to try to try to help my friends and family back home see other possibilities for thinking about the way we live our lives I hope can be helpful.

David Goldstein:

Well, the good news from the Finnish example is that after we in the US fight our coming civil war, there’s hope that we can adopt the more sane and humane system like Finland did.

Trevor Corson:

Well, that was obviously part of the subtext of ours.

Anu Partanen:

Finns are very pessimistic people often in many ways but I would commend you for very Finnish lesson from our article.

Nick Hanauer:

Well, thank you guys so much for spending the time chatting with us.

Trevor Corson:

Thanks for having us. It was an honor.

Anu Partanen:

Thank you.

Nick Hanauer:

Okay, thank you.

Trevor Corson:

Bye.

Nick Hanauer:

Bye-bye.

Nick Hanauer:

Goldie, I visited Helsinki for a few days a couple of years ago for the Slush Conference which is this giant European tech conference where I gave a speech. And I had just a blast there and I got to meet all these really interesting people, got to have dinner with the president. The place is just so shiny and clean and well-organized and prosperous and pretty. And I know it’s super far north. It’s supposed to be dark all the time but-

David Goldstein:

The economy has nothing to do with that.

Nick Hanauer:

No, okay, but here’s the thing is it was like clear and sunny. And it was just a magically gorgeous place filled with what looked like very happy people. And I think the interview that we just had with these people reflects that reality.

David Goldstein:

Right. After to Anu and Trevor and having read Anu’s book, the Nordic Theory of Everything which I highly recommend, go out and buy it. Read it. I’ve got a confession to make, Nick. I think I’m a secret Nord.

Nick Hanauer:

You don’t look like a Nord.

David Goldstein:

Is that a noun? No, think about this, Nick. You know me. You’ve known me for about five years now. The Finns and the Nords, they’re kind of a dark and pessimistic.

Nick Hanauer:

Well, then you fit right in there.

David Goldstein:

Right. She also says they like to complain.

Nick Hanauer:

You fit right in there.

David Goldstein:

Right. Pickled herring, I fit right in there. But also, and don’t take this personally, Nick, but I’ve always kind of resented salary jobs. I mean as far as dictators go, you’re pretty benevolent dictator but you were a dictator nonetheless. And partially it’s got to do, and she talks about this in the book, the American system in which our lives are so precarious that if we lose our jobs, we lose our housing. We lose our healthcare.

David Goldstein:

Our healthcare is provided by our employers and if you decide to change our insurance, then I may have to switch doctors or I may have to pay more out of pocket. And I’m totally dependent on you for so many things. There’s something uncomfortable and wrong about it. What I want and what I’ve tried to do throughout my life and that’s why most of the first 25 years of my adult life, I was self-employed, is I want to be independent. That’s the American dream to be independent and-

Nick Hanauer:

Well, I don’t think it’s just an American dream. I think it’s a dream of all people, is to be unexploited.

David Goldstein:

When you have that independence, say, in a country like Finland where you don’t have to worry about getting sick and going bankrupt because everybody is covered and it’s affordable. If you have kids, you don’t have to worry about paying $1,500 a month for daycare because daycare is free or affordable, no more than the equivalent of $300 a month.

David Goldstein:

You don’t have to worry about buying a house in a nice neighborhood so that your kids will have the opportunity to go to a good school because all of the schools are good. You don’t have to worry about saving for college so that your kids don’t have to go into tens of thousands, if not hundreds of thousands of dollars in debt if they want to get an education. They can succeed in life because college is free to everybody.

David Goldstein:

That creates a type of freedom that I feel that most people are missing in this country and I think that people like you and me that we are very, very different outcomes, we both came out of a very privileged environment where we did not have to worry how to pay for those things. We did not have to worry about how we were going to go to college because we had family to provide that but we were lucky and we were the few.

Nick Hanauer:

Yeah, for sure.

David Goldstein:

And in a country like Finland, you can have all the advantages of a market economy, of what people call capitalism.

Nick Hanauer:

Yeah, but very few of the downsides.

David Goldstein:

Very few. And I think it allows you to be more free, more risk taking, more entrepreneurial because-

Nick Hanauer:

Much less stressed.

David Goldstein:

Much less stressed. And I think about from an entrepreneurial sense, a lot of people, I mean there’s statistics. Homeowners start few businesses than non-homeowners because they’re afraid to lose their house in the US. So to understand market capitalism as an evolutionary system is to understand that most businesses necessarily fail. They have to fail. That’s how selection works. Most innovations don’t succeed but if failing in a business leaves you on the streets, well then, you’re going to stick with that job that pays and allows you to feed your children and put roof over their heads.

David Goldstein:

I look at the Finnish model and I say, “Okay, it’s a little dark for me in the winters, but pessimism, complaining a lot, pickled herring. And oh, by the way, free healthcare, free daycare, good public schools, free college and long-term care when you get old?” That’s the type of market capitalism for me.

Nick Hanauer:

That’s right. And none of these things are out reach for Americans.

David Goldstein:

Are we less competent than the Finns?

Nick Hanauer:

We could have all of these things.

David Goldstein:

Think of all the extra vitamin D we have-

Nick Hanauer:

Yeah, exactly.

David Goldstein:

… throughout most of the country.

Nick Hanauer:

Yeah. All of these things are within reach if we wanted them. And if we could push past the entrenched interests that don’t want us to have them, the healthcare system that we have …

David Goldstein:

That not only don’t want us to have them, Nick, but don’t want us to know that we have a choice about whether or not to have them.

Nick Hanauer:

That’s right. And they have been frankly lying to us for decades about how these alternatives are hellscapes and in fact, they’re not. These places are now more prosperous, more free, certainly easier and better to live in than what we call home. And all of these has happened in one lifetime and all of it happened because there’s a certain small group of people wanted it to happen and that means that we could make it unhappen if we wanted to if we got together and did the right things and promoted the right policies and ideas.

David Goldstein:

And to open up our imagination to a different kind of capitalism.

Nick Hanauer:

Exactly.

David Goldstein:

On the next episode, Nick, we’re going to make a lot of our listeners really, really happy.

Nick Hanauer:

I know and so embarrassing that it’s taken us so long to get around to this, right?

David Goldstein:

Right, because we’re going to continue this conversation with the economist, Steve Keen, who has been reimagining capitalism and tearing down the old economics-

Nick Hanauer:

That’s right, for a lot longer than we have.

David Goldstein:

That’s right.

Nick Hanauer:

That’s right, and is beloved by many of our listeners in around the world and he’s an incredibly smart guy. It’ll be fun to talk to him.

Speaker 1:

Pitchfork Economics is produced by Civic Ventures. The magic happens in Seattle in partnership with The Young Turks network. If you liked the show, make sure to subscribe, rate, and review us wherever you get your podcasts. Find us on Twitter and Facebook, @civicaction and Nick Hanauer. Follow our writing on medium@civicskunkworks and peek behind the podcast scenes on Instagram at Pitchfork Economics. As always, from our team at Civic Ventures, thanks for listening. See you next week.