09-01-2010, 02:07 AM
The article discusses several aspects of the bankrupt welfare state in Finland, but of particular interest here is the portion discussing their higher ed system.
Even people in thoroughly socialist Scandinavia are talking about how college degrees are worthless in the job market and cutting government spending. People are waking up everywhere.
Even people in thoroughly socialist Scandinavia are talking about how college degrees are worthless in the job market and cutting government spending. People are waking up everywhere.
Quote:The Bankrupt Finnish Welfare State
Tuesday, August 31, 2010 by Kaj Grussner
Progressives in America are often keen on promoting the European welfare state as an argument for big government, not least in the healthcare debate. They point to European countries, often the social-democratic Nordic countries, as role models, with their universal healthcare, public school system, generous social-safety net, and all the happy people who live there.
This line of argument got a significant boost when Newsweek proclaimed that Finland was the best country in the world to live in, closely followed by Sweden and Switzerland. And of course they are happy. After all, there is no poverty in these great countries, the populace is educated, and people generally don't have a care in the world, because the benevolent government is always there to solve every problem.
Many people have tried to dispel this myth, but it still persists. I don't presume to be able to put this issue to rest, but there are some things that should be known about this mythical utopia, the "best country in the world" — Finland.
Government Education
Like other Scandinavian countries, Finland likes boasting about its public education system. All schools are run by the government, even the universities. There are no tuition fees for Finnish students. On the contrary, students actually get paid over 400 euros per month to get a degree, in addition to heavily subsidized student loans, student lunches, etc. Free higher education is seen as a right, and because it is a right it must be accessible. To this end, Finland has 20 universities and 27 polytechnics. This in a country with about 5.3 million people, of which 1 million live in the capital-city area, and where only five other cities have a population over 100,000.
One might think it great that there are so many places of higher learning in a country with so few inhabitants, a proof that its people are educated and civilized. Few things could be further from the truth.
First of all, the reason for having so many universities is regional politics. Politicians buy votes by creating and maintaining government jobs in depressed areas — the oldest trick in the book.
Second, the multitude of universities and polytechnics brings the overall level of education down, because such a small population can't possibly maintain a high standard of education in so many different places. There simply aren't enough competent people to go around, not to mention that many of the universities and polytechnics are located in less than desirable places. Only very few of the Finnish universities can lay claim to a really high standard of education. Of course, the economics education is subpar across the board.
Third, with higher education so accessible, it lures thousands of people every year to go for a degree, even though they have no business in the world of academia. This produces a great number of bachelors, masters, and PhDs who don't have any value on the job market because they studied literature, art history, religious studies, or something like that. In many cases, they didn't choose their major because they actually thought it would give them a job; they chose it because it seemed fun or interesting, or it was easier to get into than law school or medical school.
Unemployment among educated people has become a chronic problem. The other side of the coin is that Finland has long had an acute shortage of people with trade skills: carpenters, plumbers, mechanics, and so on — people who can actually provide a valuable service. The shortage has, predictably, driven up prices and prolonged delivery.
. . .
With a License to Rob
As a tax consultant, I am frequently engaged in legal battles with the tax authorities, representing my clients and trying to protect their rights. In these fights, I encounter the arrogance, and in some cases the sheer malevolence, of the taxman, completely uncensored. I never cease to be amazed by the ignorance and the callousness of this particular department of the state.
As a rule, the tax authorities don't care about the law, in the rare event they even know it. Not only that, but it is clear from the way they act that they consider every penny to be their money, and may only be retained by the taxpayer at their discretion. It even happens that they make up arguments that are blatantly false and without any legal ground whatsoever in order to levy more taxes and impose various other sanctions. When the taxpayers challenge their outrageous claims, they simply ignore the challenges and press on as if nothing has happened — even though the constitution mandates that all decisions and rulings made by a government agency must be based on law and thoroughly explained.
This doesn't seem to apply to the tax authorities though, and neither do other legal principles. In all other matters, you are innocent until proven guilty, but if the taxman charges you with something, it is you who has to prove your innocence. If you fail, you're guilty, and it is the tax authorities who decide whether you fail.
This type of behavior is certainly familiar to the American public, as the IRS has subjected them to all kinds of violations. However, these violations, taking place no less regularly in Finland than in the United States, fly in the face of the aura of utopia that seems to surround the social-democratic welfare states of Northern Europe.
The statists may be very comfortable with high taxes, but even they tend to become squeamish when they hear of the havoc wrought upon private individuals and their families by the tax authorities. And it is of course the private individuals and small businessmen who suffer the most aggression, because they seldom have the knowledge or the resources to defend themselves. Billionaires and big corporations at least have a fighting chance; the little guys don't. So much for the compassionate society.
In a system such as this — with a very vague tax code; tax officials who are exempt from responsibility for their conduct; and onerous, never-compensated legal expenses arising from litigation against the tax authorities — the rights of the taxpayers are routinely violated. The officials have no interest in making the right decision, so whenever a case is not utterly and totally obvious, they rule in favor of the state.
"The state enacts vague legislation and then makes the taxpayer pay for its interpretation."After that, the taxpayer can choose between paying the additional and often unlawful tax, or spending time and money challenging the decision. And because the tax officials can and do routinely ignore the taxpayer's arguments, even the most trivial of cases can be appealed through the judicial system all the way to the Supreme Administrative Court, the highest court in the land. If the taxpayer is unlucky, it can take as long as ten years to settle a dispute, costing tens of thousands in legal fees. And if he wins, he is not compensated for the time and money spent defending his rights, nor are the responsible tax officials reprimanded for their conduct. For this reason, most tax disputes are settled mainly by referring to case law, and the case law has to a large extent been paid for by the taxpayers. In other words, the state enacts vague legislation and then makes the taxpayer pay for its interpretation.
. . .
Conclusion
Finland is, and has long been, a poster child for the utopian European social-democratic welfare state, and has now been named the greatest country in the world, in a bizarre remake of Time's Person of the Year award to Ben Bernanke.
In Finland, the progressives believe, big government works. So do universal healthcare and public, "free" education. And if Finland can do it, so can the United States. The flaw in that argument is that Finland actually can't do it, no more than Obama can keep his promises.
The Finnish welfare state comes at a price we can't afford. The healthcare system is severely inefficient and costly, and stands in the way of normal people's access to the truly great medical care provided by the private sector. The public education is also very costly and constantly short of money. Textbooks are passed on from generation to generation, everybody learning the same fallacies as the ones before them, provided that books are even readable.
The idea of everyone's right to a university degree has resulted in a very high number of university graduates, but their degrees are often of no value on the job market. Due to high taxes and both the legal and financial risks of employing people, an 8 percent unemployment rate is considered normal. And did I mention that the retirement system is every bit as much of a Ponzi scheme as the US Social Security system, and is on the verge of collapse?
The national debt has already reached alarming levels. What's more, there hasn't been an extended period of time when the principal of the debt has been systematically paid off. At best, it has remained fairly stable, only to shoot up by almost 50 percent in the last couple of years, if the projections hold true. Bankruptcy will come unless significant changes are made.
I do, however, want to end on a positive note. In survey after survey, the Finnish people overwhelmingly favor cutting government spending as a means to get the public finances under control. Previously, the Finnish have not minded paying taxes, but now they are waking up to the fact that raising taxes is not a viable option anymore.
Next year, we Finns go to the polling stations to elect a new parliament. I hope the outcome of the election will reflect this important and new-found realization.
