New Nations’ annual ‘World Democracy Audit’ analyses the progress of 154 nations, synthesizing data from Freedom House and Transparency International, to offer an overview and a ranking of the countries which most adhere to democratic principles, and of those who do not! 

After seventeen years, consistently at the top of the First division are the Scandinavian nations: This year is typical. Denmark is in first place, followed by Norway, Finland and Sweden all three in joint second place. 'The Nordic model', as if it often called, has many admirers, not least its own citizens. Denmark regularly ranks as the happiest country in the world in the World Happiness Index. New Nation’s’ rankings system takes into account human rights, political rights, low income disparity, press freedom and (the degree or absence of) corruption. To give a sense of its spread, lurking at the bottom of the table are pariah regimes (North Korea occupies the very bottom); nations in the grip of outright warfare (Syria comes second from bottom), those still reigned by personality cults and secretive dictatorships (Turkmenistan, Uzbekistan, Eritrea, Sudan and more), or are semi-tribal, in the examples of many African states in the Fourth division. 

Some of the countries have no aspirations whatsoever towards democracy, but would consider themselves, economically and in geopolitical terms, to be success stories – Division 4’s China being an obvious example. For those nations however, which attempt to engage with the notion of democratic values, there is much to be learned by examining the Scandinavian success stories. Characterized by comprehensive welfare systems funded by high taxes with an enviable distribution of wealth across society, high employment, and parity in terms of gender and LGBT rights, this report will endeavour to probe some of the reasons for the success, and to work out, if and how other nations can learn from their example. 

A clear factor that distinguishes the Scandinavian nations and indeed some of the other states in division one, is that 3 out of 4 of them are hereditary constitutional monarchies. In Denmark, the ruling queen is Margrethe II, who has been the monarch since 1972. In Sweden, King Carl XVI Gustaf of the House of Bernadotte has been in power since 1973. He is the head of state, and his role is ceremonial. Norway has, since 1814, been a constitutional monarchy and Harald V, in power since 1991, has a symbolic role. He is the protector of the state church, the Church of Norway and the Supreme commander of the armed forces, thus, in a democracy depoliticizing that role. It is certainly interesting to consider how the existence of ‘constitutional’ monarchies (which as an institution, in its ‘absolute’ mode is seen, as with the Russian Tsarist model, as a deeply reactionary form of power structure), brings to bear on the success of these nations as democracies, given the somewhat counter-intuitive nature of that relationship between monarchy and democracy. 

It has been noted that symbolic monarchies like these can still help to solder feelings of national identity and provide a focus for feelings that otherwise, as in Poland, for example, a country which has a clear and adamant nationalist bent, but where the communist period forced ‘national feeling’ underground. Hence, the importance to the Poles of the naming of Jean Paul II as Pope, in 1978. He became the embodiment of Polish Catholic and national identity, playing no small part in the movement towards independence and the Solidarity movement, as nationalist feelings could be and were invested in him. The lack of a traditional, perennial, hereditary figurehead may explain to some extent, why nationalism has reared its head in such an ugly and extreme fashion, as in recent years (which in turn might contextualize why Poland has fallen down in the World Democracy Audit from the first to the second division). Analysts Andreas Bergh and Christian Bjørnskov have found that social trust is stronger in monarchies, which explains why in Transparency International's corruption perceptions index, there are 7 monarchies inside the top 10 countries listed for ‘an absence of corruption’. This in turn feeds into economic performance. 

The former Bank of England rate-setter Tim Besley has suggested in a working paper that "in a country with weak executive constraints, going from a non-hereditary leader to an hereditary leader, increases the annual average economic growth of the country by 1.03 percentage points per year." Equally, a study by Oxford University's Petra Schleiter and Kent's Edward Morgan-Jones has concluded that governments under constitutional monarchies are more likely to consult their people with early elections, thus building trust and providing a sense of safeguarding. Analyst Dylan Mathews writing in the Washington Post argued that constitutional monarchy is, “at worst, fully compatible with representative democracy, and, at best, makes representative democracy stronger.” This is perhaps something for republicans, of whom there are apparently 15% in the UK, among them Labour leader Jeremy Corbyn, to consider. There are many arguments against maintaining the monarchy, largely oriented around expense, but it had also been pointed out by Forbes that monarchs are not necessarily more expensive than Presidents. While the British Queen is apparently the most expensive monarch in Europe, the most expensive head of state is in fact the President of France. According to one study, the royals of Denmark, Sweden, Belgium, Luxembourg and Spain each cost less than half as much as the President of Germany does. 

There have also been studies into the importance of religion, in forming the “Nordic model”. Political scientist Martin Schroder has argued that Lutheranism (the principal religion in Scandinavia) may have impacted attitudes towards welfare, as it encourages state intervention in the life of society as a whole; Catholicism, he argues, focuses on maintaining social order and therefore reducing state intervention.

When considering the success stories of Scandinavia, one must examine the kind of economic system they have. It has been referred to by some economists as a kind of “cuddly capitalism”, as opposed its cut-throat cousin, as seen in the US or UK. Much of the discourse surrounding the success of Scandinavia focuses on the ideas of socialism, in particular as a result of comments made by one time US democratic candidate ‘hopeful’ Bernie Sanders, who had extensively praised Denmark as an example of highly functioning socialism. The idea of northern Europe as a socialist haven has become so entrenched, that Danish Prime Minister Lars Lokke Rasmussen felt the need to point out in a recent speech at Harvard's Kennedy School of Government, “I would like to make one thing clear,[…] Denmark is far from a socialist planned economy. Denmark is a market economy." 

One of the reasons observers tend to associate Scandinavia with socialism is because of the high fiscal burden it places on individuals. in Sweden, Denmark and Norway citizens pay around 50% of their income in tax, and in some cases, 60%. This money is then funneled back into the welfare system which among other things (like free education and healthcare) zealously protects workers when they fall out of employment. Those who lose their job in Sweden can expect to receive around 80% of their salary in the first 200 days out of work, in Norway you can receive up to 62% for two years. Workers’ rights are so well protected that there is little in the way of discontent, nor have the Communist parties in these states attracted significant support. Widespread unionization assures the protection of the workforce. In Denmark, 75% of the work force is unionized and there are similarly strong movements across the rest of Scandinavia. These labour movements have had, since the Second World War, strong connections with social democratic political parties, particularly in the case of Sweden, where the Social Democratic majority governments after the war could deepen the political strength of the trade unions. Here the Rehn-Meidner model, developed by two economists from the Swedish Trade Union Confederation in 1951 and designed to create a positive business cycle, on the basis of a Keynesian fiscal basis, state intervention and active labour market policies was never fully realised.  But it has maintained a conceptual pre-eminence in terms of thinking about how to structure the interaction between labour and the state. 

In Denmark, the creation of a model for employers and labour to co-exist in a mutually beneficial relationship, was enshrined even earlier, at the turn of the 19th century, in the ‘September Compromise’ of 1899 - a series of negotiations between employers and trade unions. This marked at the reaching of an agreement between the two sides to assure stability. Dubbed ‘flexicurity’, this system allows for flexibilty within the labor market, an active labour market policy and social security. This tradition of “compromise” essentially manages to reduce sources of conflict between the interest of capital and labour. 

Apart from Norway, where there is a considerable amount of state ownership, these economies are nonetheless characterised by free market capitalism. Employment law makes it easy for employers to take on or reduce staff, and these vicissitudes are made palatable to workers, thanks to the system of welfare that ensure that their well-being is assured in times of trouble. There is an emphasis on participation. Some analysts such as socialist economists John Roemer and Pranab Bardhan, have asserted that the strength of the labour movements in the Scandinavian model is what assures egalitarianism, which is one of the reason why it might be difficult to export to other countries, where labor movements are less strong. The principle of collective bargaining extends not only to wages, but to elements which affect workers more broadly (such as pensions, sick leave and so on), which might fall more broadly under the umbrella of social policy. 

Hence the level of participation in policy development ensures a sense of inclusion and investment, felt by all. Additionally, when you are unemployed, you remain within the union, which in turn helps to reintegrate unemployed workers back into work. The fact that around 1/3 of the work force in these countries is employed in the public sector, also helps to protect the workforce from the vicissitudes of the markets, meaning that when the world financial crisis in 2008 occurred, for example, the Scandinavian nations fared better than other European nations with a smaller public sector. The economies of these nations frequently rank highly in competitiveness indices, which are again tied to the well-funded public sector, and an emphasis on education, which makes workers adaptable and capable of responding to changes in technology. 

Lastly, a key factor which is abstract but seems to recur frequently, in analysis of the success of the socio-economic model in Scandinavia, is trust. Negotiations between private and public actors in Scandinavia take place frequently, in numerous different places, in good faith. This creates trust, and means that sources of conflict quickly come to the surface and can be addressed in good time. 

Trust is a certainly an important word when it comes to Scandinavian success. Christian Bjørnskov from Aarhus Business School, who has written a PhD on ‘happiness’ in Denmark, notes that, “The happiness surveys normally ask people to evaluate their lives. Research shows what makes the Danes so happy, is that they are very trusting of other people that they don’t know. Trust helps make people happy. Also just as importantly, Danes feel empowered to be able to change something in their life, if they don’t like it”. When it comes to learning lessons from Scandinavia, it is difficult to instruct countries to develop their citizens’ trust in political institutions, since this is a process that takes years. In the same way that one cannot create trust in a vacuum, one cannot whip a largely symbolic national figurehead out of thin air, even if that model seems to work remarkably well in the case of Scandinavia. 

Obviously there are specifics in terms of the conditions out of which these successful democracies have emerged and their unique historical, geographical and social characteristics mean that exporting their ‘way of doing things’ is not always possible.   They have benefited from being relatively small, They have extractive industries from which they can make money, In modern history they have never been colonized. 

However, it is certainly interesting to ponder and to compare, particularly in the case of nations like the UK, which share some of these characteristics. 

Indeed, a comparison is even more compelling with the USA, which has traditionally been seen and represents itself as the bastion of democratic values, yet now under Trump, of course, seems to have radically disengaged with some of the hallmarks of a happy society ie. equal opportunities, a widespread decent standard of living, a trust in the institutions that govern it. 

It is not only Bernie Sanders who should be thinking about better ways of doing things. 

Sara Bielecki