SECOND OPINION:Do we choose the Nordic health system, or the Anglo-Saxon model? Gerry Burkeand Pierce Graceexplore the differences.
IRELAND HAS a social model based on a low taxation system (about 30 per cent), with moderate social welfare supports and with health and education largely publicly funded, in a free market economy. Low taxation has been its most salient feature in recent years. Income redistribution is fairly limited.
The model is similar to that of other English-speaking countries and has origins in 19th century British laissez-faire free market economic theory. At its most extreme, the "Anglo-Saxon" social model results in the uncomfortable juxtaposition of conspicuous wealth and conspicuous poverty.
The Nordic social model involves higher taxation (50 per cent in Sweden and Denmark) with greater income redistribution and, consequently, smaller income disparity. Citizens are afforded generous social welfare allowances. Fairly consistent government of these countries by social democratic parties since the end of the second World War has allowed this system to develop through the Fabian process of gradualism. The Nordic model has been criticised for inhibiting individual enterprise and productivity.
Jeffrey Sachs, an American academic economist at Columbia University and expert on world poverty, compared the economic performance of the Nordic countries, Sweden, Norway, Denmark and Finland with a group of English-speaking countries: the US, the UK, Ireland, Australia, Canada and New Zealand. He concluded that "a generous social-welfare state is not a road to serfdom but rather to fairness, economic equality and international competitiveness", citing their higher incomes, better health outcomes, lower rates of poverty and greater investment in research and development.
The Nordic social model produces a higher GDP per capita than the "Anglo-Saxon" model. In addition to slightly lower unemployment, Nordic countries will have, on average, a positive balance of payments and government surpluses in 2008 while the English-speaking countries will report deficits.
Life expectancy is similar, but Nordic countries enjoy the lowest infant mortality in the world, probably because of greater publicly-funded investment in their health service and their low child poverty rate (3 per cent): poverty and health are inextricably linked.
The US has the lowest life expectancy and highest infant mortality of these countries. Investment in healthcare is not very different, with the exception of the US, which spends more than double what the Nordic countries spend but, crucially, in the Nordic countries a higher proportion of the health expenditure is public.
The large difference in public social expenditure (25 per cent versus 17.6 per cent) has resulted in astonishing differences in the rates of child poverty and imprisonment in the Nordic and English-speaking countries.
Unicef selected Ireland out for special criticism in its 2007 overview of child poverty. Despite strong recent economic growth, Ireland ranked 22nd of 25 rich countries for children's material wellbeing, the assessment of which contained three components - relative income poverty, children in households without an employed adult and direct measures of deprivation (eg 10 per cent of Irish children aged 15 reported fewer than 10 books in the home). Sweden, Norway, Finland and Denmark were ranked one to four. Ireland, Italy, UK, New Zealand and US occupied the bottom five places for relative income poverty.
Ireland's prison population (80 per 100,000) is only slightly higher than that of the Nordic countries, but the US prison population is the world's highest (730 per 100,000). By the end of 2006, 7.2 million people, or one in every 31 US adults, were behind bars, on probation or on parole; 2.2 million were in prison. The rate of imprisonment in the other four English-speaking countries is approximately double that of the Nordic countries.
This data has been available at a time when an accelerated process of privatisation of health care provision has become Government policy. It includes the National Treatment Purchasing Fund, co-location and the entry of private "for-profit" providers into the health insurance market.
The medical literature from the US on the investor-owned for-profit service providers is abundantly clear: in a large analysis comparing private "for-profit" hospitals with private "not-for-profit" hospitals, care was 19 per cent more expensive in the "for-profit" hospitals. Medicare payments are higher in areas served by investor-owned hospitals.
The CEOs of large for-profit American corporations are typically paid 180 times the pay of a hospital house-keeper, compared with 20 times in the public and not-for-profit sector. Steffi Woolhandler and David Himmelstein, of Harvard Medical School, described the situation accurately: "Behind false claims of efficiency lies a much uglier truth. Investor-owned care embodies a new value system that severs the community roots and Samaritan tradition of hospitals, makes physicians and nurses into instruments of investors and views patients as commodities".
The Nordic social model is successful because, rather than squandering their money, citizens invest collectively and prudently in their own welfare. If Ireland is to aspire to the same living standards that Scandinavian citizens enjoy, we must be prepared to pay more tax. No two ways about it.
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Dr Gerry Burkeis a consultant obstetrician and gynae- cologist and Prof Pierce Gracea consultant vascular surgeon