28/06/2007 2:54:39 pm
Impossible To Reduce Public Spending? Perhaps someone wonders where I am. Well, I am in Stockholm, back from Brussels Tuesday evening. The debate at the European Ideas Network went well, by the way. It was also rather interesting. One other speaker, Martin Ågerup, Managing Director of CEPOS in Denmark, showed a strong correlation between big government and low levels of entrepreneurship - and vice versa.

Right now, I am completely snowed under by deadlines, implying that there has to be a lot of reading and writing in the weeks to come. Some interesting pieces of information I have encountered are busting a common myth. It is often said that no wealthy country has managed to decrease public spending as a share of GDP substantially or lasting. This is not true.

Ireland decreased public expenditure from 57 per cent in 1982 to 35 per cent in 2005. New Zealand decreased the share from 44 per cent in 1991 to 33 per cent in 1998. Britain decreased it from 44 to 40,5 per cent in the 1980s. Not to mention countries in Eastern and Central Europe like Estonia and Slovakia with radical reductions.

It is possible. It just takes political will.