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Socialist Norway's Economics: Thriving in Crisis
Key Excerpts from Article on Website of New York Times
Posted: May 31st, 2009
http://www.nytimes.com/2009/05/14/business/global/14frugal.h...
When capitalism seemed on the verge of collapse last fall, Kristin Halvorsen, Norways Socialist finance minister and a longtime free market skeptic, did more than crow. As investors the world over sold in a panic, she bucked the tide, authorizing Norways $300 billion sovereign wealth fund to ramp up its stock buying program by $60 billion or about 23 percent of Norway's economic output. "The timing was not that bad," Ms. Halvorsen said, smiling with satisfaction over the broad worldwide market rally that began in early March. The global financial crisis has brought low the economies of just about every country on earth. But not Norway. With a quirky contrariness as deeply etched in the national character as the fjords carved into its rugged landscape, Norway has thrived by going its own way. When others splurged, it saved. When others sought to limit the role of government, Norway strengthened its cradle-to-grave welfare state. And in the midst of the worst global downturn since the Depression, Norways economy grew last year by just under 3 percent. The government enjoys a budget surplus of 11 percent. Norway is a relatively small country with a ... population of 4.6 million and the advantages of being a major oil exporter. Even though prices have sharply declined, the government is not particularly worried. That is because Norway avoided the usual trap that plagues many energy-rich countries. Instead of spending its riches lavishly, it passed legislation ensuring that oil revenue went straight into its sovereign wealth fund, state money that is used to make investments around the world. Now its sovereign wealth fund is close to being the largest in the world.
Note: For lots more on the global economic and financial crisis from reliable sources, click here.
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