Austerity is thought to be a universal process by most people, but there are a few countries in which extraordinary circumstances have allowed the pursuit of other financial goals.
One such country is Norway, which has been investing the proceeds of its oil and gas extraction from the North Sea for decades. The resulting sovereign wealth fund is set to exceed $1,000,000,000,000 by 2020- over $80,000 per person. Norway has a political consensus in favour of continued investment and reinvestment in the fund, but the question arises: what will they do with it?
The fund is amazingly vast. One in 50 publicly listed shares in Europe is owned by the Norwegian state, with over $1,000,000,000 of shares flowing through their transactions department every week. With all profits reinvested into the fund, it grew quickly when shares were depressed in the ’08-10 recession, and is reaping the benefits now.
But before any Brits- and Scottish folk in particular- weep at the failure of our governments to be similarly prudential, (with our share of the North Sea proceeds) they should be aware of the fact that our National Debt is twice the size of such a fund, and we used our revenues to save the country from bankruptcy in the 1970s. No, you need a lot of resources and a small population to ever be in the position of Norway.
But to answer the question that many have been asking: ‘can a country have too much money?’ The short answer is no. When every injustice and social problem is solved, maybe. But that can never be achieved, with or without money. Norway is in the envious position of being able to experiment with the provision of new public services and radical investments without the acute risks that other countries face. When the country decides to supplement its spending with fund dividends, it can pilot things ranging from free universal public transport to a ‘ Citizen’s Income’ (a guaranteed payment to every adult in place of several means tested benefits) to maximum school class sizes of 12. It may be true that we socialists can always think of new ways to spend money, but Norway has the unique chance to show the world what we might invest scarce public resources in.
Alternatively, I suggest we all pack our bags and make our way to Oslo.
