If Sweden Left The EU and Joined the US, It Would Be the Poorest U.S. State, Below Even Mississippi
There is some lively discussion in the comments section of this recent post about poverty, Sweden, income inequality, etc. One issue is about the unemployment rates in Sweden vs. the USA, which are displayed in the graph above. Over the last 15 years, the average jobless rate in Sweden was 7.3%, more than two percentage points higher than the U.S. average of 5.2%. I think it would safe to assume that if Sweden was a U.S. state, it would have had the highest unemployment rate in the country since 1993, higher even than Mississippi, Michigan or Alaska.
And for an analysis of Sweden's economic condition, I suggest reading this post: "Swede and Sour," by Swedish author and blogger Johan Norberg, here are some excerpts:
If Sweden left the EU and joined the U.S. we would be the poorest state of America. Using fixed prices and purchasing power parity adjusted data, the median household income in Sweden in the late 1990s was the equivalent of $26,800 compared with a median of $39,400 for U.S. households - before taxes. And then we should remember that Sweden has the world´s highest taxes.
The Swedish Research Institute of Trade, which conducted the study, underlined that African Americans, who have the lowest income in the United States, now have a higher standard of living than an ordinary Swedish household.
Between 1870-1970, Swedish growth was the highest in the world, next to Japan's. In 1970 Sweden was the fourth richest among the OECD-members, after USA, Luxembourg and Switzerland.
After more than 30 years of high taxation and an expanding welfare state, Sweden is not the 4th richest OECD-country any longer, but the 15th. This hurts the least well off most. Between 1980 and 1999, the gross income of Sweden's poorest households increased by just over 6% while the poorest in the U.S. enjoyed a three time larger increase.
Bottom Line: Unless you think that Mississippi and Michigan represent ideal economic models of growth and prosperity, you probably shouldn't think about Sweden as economic nirvana.
Update: According to this study from Swedish think tank Timbro ("EU vs. USA"), "This report is about the fact that per capita GDP is lower in most of the countries of Europe than in most of the states of the USA." Further, "Sweden would be the seventh poorest as a state of the USA."