Finland as global socialist model?

Following the Soviet invasion of Finland in 1939, Finnish militiamen--some of them mounted on skis--fought a heroic and successful "Winter War" to evict the Red Army. Although Finland's government, in large measure owing to geography, was officially neutral during the Cold War, the Finnish people were unabashedly opposed to totalitarian socialism on the Soviet model. Unfortunately, they proved susceptible to the less feral version pioneered by Sweden.

The October 26 Christian Science Monitor extolled Finland for boasting both "a thriving hi-tech economy ranked most competitive in the world" and "a welfare state that has created one of the globe's most egalitarian societies. Envious policymakers from far and wide are beating a path to Helsinki to learn the secrets of Finland's success."

The Finnish model of socialism isn't suitable for other societies. Finnish academic Petri Rouvinen points out that "The Finnish mindset is collectivist.... It's that kind of mindset that makes it possible to have this sort of system." "We are a small homogenous country, heavily state-based, and our social model as a whole is so typically Finnish that it won't travel," admits sociology professor Riisto Erasaari of Helsinki University. "But parts of it ... are exportable."

One attractive feature for foreign political elites is Finland's confiscatory tax rate, which claims nearly one-half of the income of successful Finns. Spending on redistributionist social programs in Finland claims almost 25 percent of the country's gross domestic product.

Finland's most notable export is the ubiquitous Nokia cellphone, the product of a state-promoted research and development effort. Nokia, which at present owns 32 percent of the global cellphone market, accounts for one-quarter of Finland's exports, 35 percent of the country's research and development investment, and four percent of its GDE This leaves the country's economy very vulnerable to sudden competitive changes in the telecommunications market.

And the Finnish safety net is fraying. Over the past 10 years "successive [Finnish] governments have grown stingier than they used to be," with pensions rising only three percent in real terms since 1993, 10 times more slowly than wages. And unemployment has climbed to more than eight percent. More serious still is the fact that Finland--like other Nordic socialist paradises--has a shockingly high suicide rate, 29.9 people per 100,000 for those aged 35-44 (more than twice the rate for the corresponding U.S. population).