Sweden Abandoned Socialism. American Socialists Missed the Memo.
The 'Swedish model' that American socialists invoke collapsed in the 1990s. What replaced it looks nothing like what the DSA is selling us.
There’s a fable Democratic Socialists of America, like New York Mayor Zohran Mamdani, enjoy telling. It goes something like this.
Nordic countries provide the model for democratic socialism; their economies hum, their people are happy, and their wealthy gladly pay their “fair share” to make it happen. If only Americans had the political courage to do the same, we could bring that paradise here.
Mamdani even called himself “a little more brown” version of a Scandinavian politician.
The problem with this story is that the Nordic paradise they’re describing doesn’t exist—and never really did.
The only bright side to “democratic socialism” as opposed to the traditional Marxist variety is that the people can democratically scrap it when it starts tanking the economy, as it inevitably does.
That’s exactly what the Swedes did in the 1990s.
Today, Sweden does have a great economy, a large middle class, a high life expectancy, and its people are among the happiest in the world. But that’s all thanks to three decades of a strong market economy born from the ruins of socialism's failure.
The Real Sweden
Sweden did not have a Richard Nixon nor a great silent majority to crush the hippie utopians demanding their version of heaven on earth. As a result, it fell to the exact kind of socialist experimentation American leftists like Bernie Sanders have always wanted for the United States.
Sweden was the fourth-richest country on earth in 1970—blessed with over a century of laissez-faire economics that allowed for massive capital accumulation, an educated workforce, and an abundance of natural resources. This foundation allowed it to thrive in spite of its new socialist policies that pushed public sector spending to 60 percent of its GDP by 1980.
However, because Sweden paid for it primarily in taxes instead of deficit spending, Sweden’s wealth creators soon felt the capital squeeze, causing them to flee to places like Monaco and Switzerland. The tax regime became so punishing that the founders of Swedish giants IKEA and H&M fled.
By early 1990s, it had dropped to the 14th-richest country in the world.
In response, Swedish voters ousted the Social Democrats for the first time in decades. Even Sweden's socialist finance minister, Kjell-Olof Feldt, conceded: “The whole thing with democratic socialism was absolutely impossible. It just didn't work.”
Sweden then systematically dismantled its socialist experiment and replaced it with what looks more like a Reagan-era reform package than anything Mamdani and Sanders support.
Sweden didn’t just cut its wealth tax—it abolished it.
It abolished the inheritance tax, too.
The country slashed the corporate tax rate from 52 percent to 21 percent, which sits today below the American rate even after President Donald Trump’s aggressive corporate tax cuts.
Then it privatized state-owned banks, telephone companies, and energy companies.
Despite the Left’s obsession with socialized health care, roughly half of Sweden’s primary care clinics are now privately owned.
Additionally, America’s bankrupt Social Security system is what a real socialist retirement system looks like as opposed to Sweden’s, which ties pension payments to economic growth.
The results of Sweden’s market liberalization have been stunning. Over 500 Swedish companies have gone public over the past decade. That’s more than Germany, France, the Netherlands, and Spain combined. Skype, Spotify, Minecraft, and Candy Crush are but a few of the corporate giants that have come from Sweden’s market liberalization.
Sweden has more billionaires per capita than economic powerhouses like Germany, Israel, and Norway—nearly on par with the United States. Mamdani would not approve.
"I don't think we should have billionaires."
— David M. McIntosh (@DavidMMcintosh) November 5, 2025
-Zohran Mamdani https://t.co/jxu49UxdmI
There is No Version of Socialism That Works
Most American leftists reject Soviet-style communism. But the version of socialism they want has also been tried and found wanting.
There is no “right way” a state can do socialism that will bend economic law to its will. When states tax entrepreneurs and businesses beyond the point of incentive, they leave and take their capital, companies, and tax contributions with them.
France similarly introduced a wealth tax and watched an estimated 42,000 millionaires depart with roughly €200 billion in capital. France soon abolished it because it was costing more in lost revenue than it was collecting.
It’s not that America’s widening wealth gap has been a positive development, or that globalization has been great for American workers. But more taxation and redistribution would destroy the avenues many of America’s poor and lower middle class have to advance by causing capital to flee and forcing them to rely on whatever dwindling capital the government can confiscate.
The lesson Sweden teaches is the opposite of what American socialist politicians and the DSA push. A socialist-lite system can work temporarily. But eventually, economic law forces a course correction—provided the system remains democratic.
Americans would do well to follow the example Sweden set. But it’s not the example the dishonest American Left pretends.
MORE HEADLINES FROM RESTORATION NEWS:
JACOB GRANDSTAFF: These States Found a Way to Train the Workforce They Need to Attract Jobs
SOCIALISM KILLS JOBS: DSA's Paid Leave Scheme Will Destroy Jobs When Young Families Need Them Most
GUN RIGHTS: Why the Second Amendment Exists—and Why Gen Z Needs to Understand It
WATCH: Democrats Need Non-Citizens to Control Congress: with Wade Miller | Restoration Spotlight
We need your help to save America—chip in today.
Restoration News, a project of Restoration of America, is your trusted investigative news source for the America First movement. As a rapidly growing conservative news site, we focus on delivering accurate and insightful exposés on political news, immigration news, leftist lies, and other pressing issues affecting everyday Americans. Our uncompromising commitment to a hard-hitting, fact-based, America First, and faithful perspective ensures that you receive news that aligns with your values.
Every dollar gets us closer to winning the war on woke
