
Why does Sweden have so many billionaires? - sksksk
http://www.slate.com/articles/business/billion_to_one/2013/10/sweden_s_billionaires_they_have_more_per_capita_than_the_united_states.html
======
Matti
"But they haven’t stopped Swedish entrepreneurs from building giant firms like
H&M, Ikea, and Tetra Pak."

Look at when the mentioned companies were founded:

IKEA - 1943

H&M - 1947

Tetra Pak - 1951

Then look at the historical tax-to-GDP ratio chart here:

[http://www.ekonomifakta.se/sv/Fakta/Skatter/Skattetryck/](http://www.ekonomifakta.se/sv/Fakta/Skatter/Skattetryck/)

The companies were founded in low-tax, pre-welfare Sweden.

~~~
anologwintermut
Or, you know, it could be the fact that Sweden's industrial capacity survived
WWII largely intact and so the country in general was better positioned than
the rest of Europe to make money.

[http://en.wikipedia.org/wiki/Sweden_in_World_War_II](http://en.wikipedia.org/wiki/Sweden_in_World_War_II)

~~~
kcorbitt
The same thing helped out post-war America as well. Was isn't good for the
economy on average, but when all of your industrialized competitors get bombs
dropped all over them and/or occupied your relative advantage in manufactured
goods goes way up.

~~~
lgbr
This theory doesn't hold up at all. Germany nearly flattened, and yet, they
had the Wirtschaftswunder (
[https://en.wikipedia.org/wiki/Wirtschaftswunder](https://en.wikipedia.org/wiki/Wirtschaftswunder)
). In fact, it wasn't just that Germany was bombed, but after the war their
machinery and even their top talent were ruthlessly pillaged by both the West
and the Soviets. And yet, Germany emerged just as well (or better by some
measures) industrially than Sweden or the US.

If you want more counter-examples, look to Japan, nothern Italy, or Austria,
whose industrial capacity and economy became exceedingly powerful after the
war.

~~~
seanmcdirmid
A lot has to do with the stability of your society; as long as your government
and talent is relatively intact, you can rebuild quite quickly even from
extreme catastrophes. Its only when you start "liquidating" the intelligentsia
(Cambodia, Soviet purges) where you begin to take steps back, or maybe a
prolonged multi-decade war or colonial occupation (Afghanistan, India).

~~~
freehunter
I would wonder if the Marshall Plan didn't contribute greatly to the post-war
success of Western Europe (as was the intention of the program). A cursory
glance over the Effects section of the Wikipedia page shows that the effects
of the plan greatly increased Western Europe's industrial and agricultural
standing.

~~~
seanmcdirmid
It sped things up, but I doubt much more than that. Look at the money we pump
into Africa and the developing world; without the right society in place, that
money just evaporates into short term fixes along with a lot of corruption and
waste (not saying we should stop, but we have to do it better than we are).

------
meriksson
The conventional story about Swedish wealth is a joke. In fact, wealth was
primarily accumulated under a largely free market system between 1840 and 1970
or so. After that the welfare state started expanding in earnest and it has
mostly been downhill from there, e.g. Sweden going from the fourth richest
country to the fourteenth.

[http://meriksson.net/how-sweden-became-rich](http://meriksson.net/how-sweden-
became-rich)

~~~
hannibal5
Sweden has acquired much more wealth since 60's than before. Something like
600 times more.

------
adventured
"The authors contrasted American-style cutthroat capitalism with Nordic-style
cuddly capitalism"

America hasn't had cut-throat Capitalism in a century.

Few seem to understand the difference between 19th century Capitalism, with
actual free markets, and 21st century Socialism. You'd think the entire 19th
century never happened, such that authors have no reference source for actual
'cut-throat' Capitalism.

We have soft European Socialism. The government system spends 40% of GDP ($6.7
trillion out of $17 trillion). We don't have a free market in nearly any
sector, including the biggest such as: healthcare, education, banking,
telecom, energy, utilities. When 80% of your economy lacks any _actual_ free
markets, how can one claim Capitalism as the system?

In fact, our government spends so much we're bankrupt a few times over when
you count entitlements + public debt, none of which can ever be paid in full.
The public debt is of course laughable, we couldn't pay it down in a century
of surpluses, even at 2% interest rates. We're currently in the process of
actively defaulting on our debt, using QE (aka debt monetization) to devalue
said debt.

The Federal Government alone spends so much, it's half the size of the entire
Chinese economy.

We have the largest welfare system in world history, by far. We have the
largest entitlement system in history, by far. We have the largest government-
controlled health system in history, by far.

America has more regulations on its books than any other country, by far. We
add thousands upon thousands of regulations annually. We have the most
regulated economy in history, there isn't even a close #2.

Our taxes are worse than Canada (supposedly a semi-Socialist nation), and
among the highest for industrialized nations when you count local + state +
federal. We also have the largest and most convoluted tax system by far, the
total IRS tax code is so large no human could ever reasonably read it.

Where's the Capitalism? It doesn't exist.

~~~
rsynnott
> 21st century Socialism

If you think that any major world economy is socialist, you're deluded.

> Our taxes are worse than Canada (supposedly a semi-Socialist nation)

Wait, what, no, it isn't. Why do you think this? Are you confusing socialism
with social democracy, or something?

~~~
frenchy
One thing you should understand about Americans is that the word 'socialist'
means something a bit different to them.

------
Coffeeparty
> _Their reasoning was that high levels of inequality create financial
> incentives for innovation_

>>[http://www.youtube.com/watch?v=WbS9jZOlQjc](http://www.youtube.com/watch?v=WbS9jZOlQjc)

Maybe we should tell those kids in somalia to "innovate" a steak or a
hamburger...

American today are living off the golden age when a man could work his way up
and actually move up in life. I say _actually_ because they had the means to
do so.

If you are too poor you can't afford shit, you can't afford to go to college,
to move to an area with better jobs (or less cancer) let alone dropping
everything and building a startup.

Why you think YC started giving out $20k? so founders wouldn't starve during
the 3 months they are skipping from work. It might be news for some here but
most young people have no savings and their parents can't support them
anymore.

Back in 1950 you could live off a part-time gig waiting tables while you were
in college/building something, but today? don't make me laugh.

~~~
pawn
It's a myth that this is no longer possible. Want to know how I know? Because
I did it.

I grew up poor. My parents told me if I was going to college, I'd have to
figure out how to do it myself because they couldn't afford to help me. So I
did. I worked hard in high school, scored a 30 on the ACT, got some
scholarships and paid the rest myself from jobs worked during school and money
saved during the summer.

I earned my CS degree, got out and found a job, and now I have a (different)
job where I can afford a 2000 sq. ft. house that I currently owe just over
$100k on and still have plenty of money to save up.

People today are generally either lazier or less imaginative. I'm not sure
which.

~~~
chiaro
I did it, therefore everyone can do it? This kind of thinking is completely
counter-productive to working towards a solution where no-one _has_ to do it.
Unfortunately such a myopic self-accountability for one's own situation is
deeply ingrained in the American mythos. Ironically, this conception leads to
some of the lowest socio-economic mobility amongst developed nations. After
all, if anyone can get to where I am, anyone who isn't where I am is in their
position because they're too lazy. No need to look at education,
incarceration, safety net programs and healthcare.

[http://en.wikipedia.org/wiki/Socio-
economic_mobility_in_the_...](http://en.wikipedia.org/wiki/Socio-
economic_mobility_in_the_United_States#Comparisons_with_other_countries)

Key quote: ... 42 percent of American men raised in the bottom fifth of
incomes stay there as adults. That shows a level of persistent disadvantage
much higher than in Denmark (25 percent) and Britain (30 percent).

~~~
matwood
I think there is a position in the middle between you and the person you
responded. I see a lot of kids now that have grown up with that attitude that
it is never their fault. That leads to not taking responsibility for their own
situation.

When I was growing up, it didn't matter if I was right. If a teacher called
the house it was _always_ my fault and I was punished. Now it seems teachers
are blamed for simply trying to do the right thing. Parents take their kids
side even when they are grossly wrong. A local murder case where 2 teens shot
and killed a guy after luring him to buy a truck has their parents and friends
posting 'free <whatever the idiot thugs are called>' on facebook and twitter.

So while you are right that a lot of factors come into play when attempting to
move up the ladder, you cannot completely absolve the individuals
responsibility for their own situation.

------
forkandwait
One thing missed by the article is that Sweden was one of the few European
highly industrialized nations that weren't ravaged by WWII (due to their
neutrality, in turn due their perceived Arianism by Germany), so in 1946, they
could start making and selling stuff to Europe which desperately needed, well,
everything.

~~~
m_eiman
_due their perceived Arianism by Germany_

As opposed to Denmark and Norway? It's more likely that the Germans got what
they wanted anyway (Sweden sold Germany a lot of steel) and didn't have
resources to occupy Sweden just for the principle of it.

~~~
a8da6b0c91d
It's not like they had any particular interest in Norway, either. It was only
about preventing the Brits from setting up shop, which they were in fact
poised to do.

~~~
sebcat
It was also about securing Narvik, a very important harbor at the time.

------
mongol
The article tells one story, and it is true, but it is not the story why
Sweden has many billionaires. Many of facts mentioned in the article are quite
recent reforms, and can in themselves not explain this.

I recall that in 1997 the social democratic government introduced tax
exemptions for the very rich, put in front of the threat by Stefan Persson
that H&M might move abroad otherwise

This old, Google-translated link to an article in Affärsvärlden (Sweden's
"Financial Times") describes a more relevant piece to the puzzle.

[http://translate.google.com/translate?hl=en&sl=auto&tl=en&pr...](http://translate.google.com/translate?hl=en&sl=auto&tl=en&prev=_dd&u=http%3A%2F%2Fwww.affarsvarlden.se%2Fhem%2Fnyheter%2Farticle2561362.ece)

------
SuperChihuahua
This might be relevant: I've summarized a few lessons from when IKEA and H&M
were startups:

[http://blog.trejdify.com/2012/08/lessons-learned-hm-
startup....](http://blog.trejdify.com/2012/08/lessons-learned-hm-startup.html)

[http://blog.trejdify.com/2012/08/lessons-learned-ikea-
startu...](http://blog.trejdify.com/2012/08/lessons-learned-ikea-startup.html)

------
fein
You could ask the Lithuanians, I'm sure they would have some colorful input.

~~~
pathy
Why is that?

~~~
fein
The housing market and quite a few banks are effectively being taken over by
Swedish banks. People are buying property but the mortgages are paying into
the pockets of non national banks, so money spent to have a home in Lithuania
is leaving the country to pay for social services in Sweden.

It's a bit of a political debate for some.

~~~
icecreampain
> social services in Sweden

What's fun to note about social services in Sweden is that they're bleeding
money like a motherfucker: more people are using the hospitals, schools,
welfare checks, etc. More and more people are jobless and unproductive, even
more unproductive people are being imported every year (over 140.000
immigrants are estimated to arrive during 2014), the services are prone to
nepotism and very generous salaries for politicians and bosses (sometimes
they're synonymous), etc.

The Swedish economy is a bomb waiting to explode, and Swedes are too afraid to
speak about it for fear of being called racist or islamophobe or what not.

So... SNAFU. Just like the rest of Europe. Sucks to not be a politician /
municipal boss right now. They're the only ones who have it blissfully easy.

~~~
tresta
Yes, there are a lot of immigrants in sweden. All of them that I have met
(except for the ones from the E.U) have been productive members of society.

There's the turk system administrator, the iranian who's also going to be a
system administrator (once he gets a visa and my employer can actually hire
him), the chinese guys, the pakistanians and so on....

Ironically the people from the E.U. that I know have been the people that are
actually abusing the system. Like the welshman who is being "burned out" (no,
he's not), and the irish guy who keep bouncing between jobs, and there are
more people like this.

------
clonnholm
Sweden also have surprisingly many millionaires as well (69,800 millionaires)
of a population of 9,5 million. The number have increased significantly the
last years.

[http://sverigesradio.se/sida/artikel.aspx?programid=2054&art...](http://sverigesradio.se/sida/artikel.aspx?programid=2054&artikel=5568950)

As a Swede who have started businesses in Finland, South Korea and Lithuania,
I do agree with the article that Sweden is the easiest country to start and
run a company in. And the relative high taxes is nothing that bother me at
all. I don't mind paying more if the service provided by it was justified.

------
ptr
"No single Swede comes close to the epic wealth of a Bill Gates or a Warren
Buffett." \-- wasn't Ingvar Kamprad (of IKEA fame) more wealthy than Gates at
one point? Due to some currency being strong, iirc.

~~~
dagw
Hans Rausing of TetraPak is currently worth $11B according for Forbes. That's
fairly close to Buffett's $55B.

~~~
alanctgardner2
In the same way that 20k a year and 100k a year are fairly close salaries ;)

~~~
saraid216
11 digits and 11 digits are the same order of magnitude, at least.

------
hannibal5
If you look at multiple indexes that rank countries by competitiveness, low
corruption and infrastructure, Sweden and other Nordic countries are usually
in top 10.

If you think countries as companies, they would be like business parks. You
can compete with low price or good infrastructure. Sweden is Google of
countries. It provides highly educated people, good infrastructure, safety and
low corruption with higher price. This will inevitability drive out low margin
industries that rely on cheap labour but it will be good environment for high-
and middle-tech companies.

------
a8da6b0c91d
At a theoretical level you would expect a free market system to produce very
few billionaires. Low regulatory barriers to entry and easy capital formation
mean high profit margins get rapidly eaten by competitors.

If you look around the world today, in practice billionaires and big
government do seem to go hand in hand. Consider the massive barriers to entry
to the US financial system erected by very wealthy people. Or more egregiously
look at the Russian oligarchs.

~~~
tsotha
>If you look around the world today, in practice billionaires and big
government do seem to go hand in hand.

Of course. The bigger and more powerful the government, the more likely
powerful people will seek to control it to their own ends.

------
Spoygg
I read "Why does Snowden..." lol :)

