torsdag 3. mars 2016

Norway at an Economic Cross Roads. Racism Helps Pave the Wrong Way?

Norway stands at an economic cross roads, for which it has to be said, it has been prepared for but never thought would actually happen. Like nuclear bunkers during the cold war, Norway has always thought to use the oil-fund in times when oil prices dived, but never actually been confronted with the reality of trying to pull off a Keynsian revival and a new, economically more liberal direction.

Politically Norway is a land where there are high moral standards towards their own people, as a quite homologous Germanic race. Further to this, they have lead the world in terms of even mindedness in conflicts like the Israel-Palestine, and taken their fair share of refugees over the years.

On the one side you have this and the moral tale of a farmer who is out hunting with a freind. He has prepared a cooked ham for their expectedly hungry return to the farm house, and let it cool on the kitchen table. Upon their return he notices footprints in the fresh snow and that his door is open. His friend suggests they sneek up and catch the intruder, and they approach the kitchen window to see a man voracioulsy eating from the ham left on the table. While his friend is eager to leap to capture the theif, the farmer stops him and says "If he is prepared to break in and eat in my house, then he must really be desperately hungry. We will let him satisfy his hunger".

Christianity and the interpretations of helping the weak in Society, which really is the gospel, the word of Christ, has a long tradition of influencing Norsk politics, from the christian-socialist relationship and the formation of the more conservative KrF - Christian folk's Party. Unlike the Tea Party and other Christian Conservative movements in the USA, they set both a high value on morals in society and also the true teaching og Jesus, not a Neo Conservative interpretation which suits the vision of a low-tax, low-welfare society where the vagiaries of charity are all the meek have to rely on. The KrF see to a large degree that government is a mediator of social well being, but also moral well being.

On the other side you have a realy fundamental basis of Norwegian politics which is " You're getting something I'm not" and their extreme dislike of 'snyltere' - freeloaders as a best translation but with a slightly more negative onomatic twist in the verbal use. This now extends to of course, the new refugee crisis, especially when it concerns those suspected or painted as being economic migrants. Norwegians are very tolerant and interested in travel, other cultures etc. Also they are very glad to have foreign labour, such as the many tens of thousands of Poles who came in the building upswing, and filled jobs that Norwegians wouldn't take.

However they have a duality here, which I am very much exposed to even as a white westerner with almost fluent Norwegian. That you are a welcomed guest for a while, a 'guest worker' but then you have suddenly outstayed your welcome and are a source of drain on reserves of society and taking most likely a Norwegians job. Worse, to some you are diluting the Norwegian culture, welfare state and even race.

Since Society began, political and religious leaders have used race and xenophobia as a means of gathering support in the population. Maybe as long ago as 5000 BC or more, societies went to war or persecuted and killed minorities over the perceived fear of their influence over society. The common good was threatened. They will overthrow the majority. Lives were at risk. Daughters would be raped.

Ethologists and anthropologists theorise that  xenophobia is very deep rooted in our psyche as a mammal, as we organised ourselves in family groups or small tribes, and continue to do so to some extent of course. In the primordial humanoid period where we were organised in small 'troops' and competed for resources on the African sahel against other primates and humanoid troops, it became very important to recognise outsiders because they usually entailed a threat to at least resource security if not war.

This behaviour can still be seen of course in primates today, but also in primitive societies such as in Papua New Guinea (where cannibalism is still present) the fear of the intruder is estolled to them taking on a supernatural threatening form, a ghost or half human.

As I often try to point out to fellow scientists and 'intelligent design' alike, we cannot escape our nature. We can only learn through experience. Racially homogenous societies and sub societies, 'tribes' like we see in the USA where segregation of the working classes by race is still a phenomenon, are particularly open to harbouring this type of suspicion because races do not mingle so do not get positive learning experiences from meeting. Furthermore  or that one race can feel economically threatened or denied by another, while worse again, incidents perpetrated by a tiny minority in an identifiable racial group or religion as seen as demonstrating the whole group's intent and potential for crime or unrest.

Today  in Norway, we really haven't come much further than this evolutionary and social historical position amongst at least a quarter of the electorate if opinion poles are to be correlated between support the most vehement anti immigrant party, the FrP, and the social phenomenon of xenophobia - fear of outside peoples. However some of their rhetoric and actions of the coalition government appease many middle of the road voters with the mantra "help them (refugees from Syria), where they are" which means in the muddy refugee cities of Turkey, Jordan and Lebanon.

There is a substantial influx of Syrians in particular to Norway, but also economic refugees from Afganistan, which by in large has large enough areas safe such that very few if any will qaulify for assylum. Far from the crime wave anticipated, those who actually work with the assylum seekers from Syria meet people who want to work, and are eager to do so. Unlike a large minority in FrP voters who are actaully on invalidity benefit, they do not have a relaationship to a welfare state, and are use to the type of economic flexibilities and need to work for a living that Donald Trump would admire.

The 'drain' on resources by the meagre benefits they get while seeking assylum and going on the integration programmes, are many times multiplied to the income of private assylum firms, hotelliers and landlords who are having an off season bonanza in rentals. Also much of the 3000 kr budget they actually have to spend each per month, goes on food of course, and due to a high tariff protectionist policy in Norway, mostly norwegian meat and vegetables. There are many who smoke, who then of course recirculate 80% of that back into the exchequor. So there is a massive keynsian spend which mostly is going to private companies, who arguably have no place in recieving such a large subsidy, but are of course more efficient in the provision of food and accomodation than the state.

So all political sides should be happy, only there is a 'doublethink-doubletalk' going on with FrP, as part of their long term strategy of being seen as supporting populist ideas, while being frustrated by the incumbent, labour dominated legal and economic frameworks. On the one hand they are only too glad to inject this huge money into the private economy, while in public they express a language which is very prejudiced and many say verges on fascist use of words and images.

In current emergency immigration policy the FrP  have actually agreed sensible policies which are part of the consensus across parliament - that there must be a limit on immigration now, other countries in Europe (EU) must follow the convention on refugees and not allow migrants and refugees passage further, and that only true refugees and politcal assylum seekers gain residence. However they use a PR line which paint themselves as the party which is both Victor and Victim- they are winning concessions towards their harder language, in the face of the entrenched government laws and agreements on refugees. In particular they want to appeal to working class labour voters, and they have succeeded for now in presenting both the xenophobic 'brown skinned rapists on our streets', and the economic arguments at a time when up to 10% of the working age population face unemployment.

Which brings us back to the Economic and Moral crossroads that Norway finds itself in. As with all Neo Conservative, populist movements in society and politics, here they are appealing to the base concepts in an adult population who have grown rich on democratic socialist policies. The average Norwegian worker commanded more than twice the EU average wage by 2010 and had two weeks more holiday. This is of course based on hard work, but more so of course those now forgotten union agreements and labour policies. You can compare Norway to Angola, a country with a larger offshore oil potential now, and huge high value mineral reserves. Yet the average worker is in comparitive desolute poverty.

In an economy with slow growth and hence low wage growth, it is of course the appeal of getting more take home from lower taxes which is the over riding populist policy of the New Right. For decades now, the Neo Conservatives have been pedling the old message that someone who does not deserve your tax money is getting it, therefore if we cut them out, you can get that extra take home money you need by tax cuts. To uneducated workers, even in the public sector or indirectly public dependent, this is a 'no brainer'. It is a simple, quick win at every turn. The left 'tax and spend' on ever new inefficiencies. The under-class as the shirkers taking from the workers.

Luckily for Norway, the refugee crisis will abate and the EU will have to assert its borders and abilities to tackle this or become very much weakened, possibly exacerbated by a Brexit and thus a powerful new outsider pushing for sovergenty with access to markets leading more scepticism. Unluckily for Norway, the price of oil is likely to remain below 40 USD for the forseeable horizon, which means that  many fields will not have life-cycle-extenstion only the most economic new wells will be drilled.

Norway has of course its sovereign wealth (" oil")  fund to spend in the economy in down turn times, but this is somewhat more unweildy than cash-in-a-quick-access-savings-account. It is however earmarked as a national pension fund, and has most of its assets less than liquid, being invested in stocks and bonds across the world. Rather in contradiction to original expectation (it is argued) the fund's domestic legal entity for internal investment became the much smaller sister to the international fund, which has made huge gains on the international financial and stock markets since its inception. The crux of the argument has long been a slight mistake if you like in the original political intention of the fund, domestic to Norway, to invest in infrastructure. The fund's trustees must secure growth in the fund by prudent investment, and there is a legal framework relating to EU and other trade laws which limits the injection of cash to companies. It can in effect not be used on what we would call PFI projects, where the state in effect pays itself interest from the tax payer, and in terms of infrastructure like road and rail, when using private limited share issue companies to build and run the sections, the return on investment is judged too low to warrent the fund management's approval for investment.

However the national pension fund as it is in effect, has been a large and patient investor in Norsk monlinth companies such as Telenor and Statoil, and it can be argued has both enabled these companies to grow large by on the one hand being patient with ROI when compared to other fund managers, while also being somewhat nationalistic in avoiding selling off companies to foreign corporates, rather approving floatations on foreign stock exchanges as a route to equity leverage and expansion.

Once again the FrP can paint themselves today as Victim ( on behalf of many Norwegians who are frustrated), unable to spend as much of the oil fund on motorways as they would like, while also later the Victor if they can be seen to have gained comprimise and movement away from the current model. Working against this road investment secneario are several factors. Firstly developing motorways outside the gentle landscape immediately around Oslo, is extremely expensive because there is the famous scenic terrain and almost within 1 m deep of any surface outside cultivated land, hard bed-rock. Secondly Labour is expensive, and in the picture, but compared to oil rigs as a pertinent example, road development is actually not Labour intensive in construction nor the least of course in operation. Thirdly there is the protracted planning process where local government are deeply entrenched. Finally there is the fact that new roads have quite small economic benefit relative to the investment.

Norwegians do fly a lot between the main cities anyway for business and pleasure, and all the major three connurbations experience often gridlock and unnacceptable air quality. However there is a natural appeal in having a motorway network between the major cities, despite the volume of traffic and cost savings of freight not really justifying in terms of ROI before the roads age and  require major maintenance. Frp  want to avoid also further toll roads, and can blame their partner in the coalition, Høyre, for persisting in this means of financing these expensive, and economically "marginal" investments.

User pays. In a private world of course, user would also have to pay, but the road network is one anomoly in the Neo Conservative resistance to public spending. One chink in the armour of the ideoglogy where by the 'collection' economy, taxes, spread the investment out over all the people such that economies of scale are achieved by large investments, and the users are not penalised by tolling. It seems that this applies happily to defence, policing and roads but not to health care and education.

Back to Norway, festering in the reality of mass job losses in the North Sea and on shore too. The other issue with the 'oil fund' is that as most all governments know, directed economic spending towards private sector production is a legally torturous and economically dubious road to follow. Other invesments in education, sports facilities and health take longer time to show fruits than a single or mayb even two parliaments.

The Frp has another dilema then, of wanting to offer tax cuts and to privatise services, while
in fact public operational spending is the one area which is floating much of the economy now that oil is in decline. And here is a warning tonew FrP voters - look only over the North Sea and the Atlantic to see the natural consequences of low-tax, low-public-service. The huge cost of private health insurance to the US citizens prior to its being tickled a bit with 'Obama care'. The lower wages, often lower quality service and profit exporting which is so typical of privatising public services. The expansion of payments at point of provision or outright movement to the private sector with above inflation price rises, as we see in rail in the UK.

And all the time a social welfare budget which actually rises, as we have seen in the UK, where the shift to private has meant that workers in public provision are more often part time and temporary with the state picking up the tab for 'down time' while employers avoid paying the on costs they have for full-time, permanent staff. This does of course then lead to the larger perception that there is an undeserving layabout underclass, while aslo it breeds a larger 'prole-cariat' , precarious economic white trash who are ready fodder for right wing extremists when the concepts of 'foreigners taking our jobs and taxes' is risen again.

The Norwegian model has worked well for society, where the focus is on wealth retention. Now there is the challenge of increasing wealth creation outside the Oil sector, and the issue of balancing the budget. IF the populist, low-tax-low-service right wing movement gains traction though post refugee crisis, then Norway will become like any other mediocre country you choose to name, where the average workers lot is not very attractive, while the New Right can gain more traction from  a greedy better off third of society as well as the 'prolecarariat's perceptions of racial intrusion and tax being wasted.

Ingen kommentarer: