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posted by martyb on Tuesday April 09 2019, @02:55AM   Printer-friendly
from the for-how-long dept.

Bloomberg:

Western Europe’s biggest petroleum producer is falling out of love with oil.

To the dismay of the nation’s powerful oil industry and its worker unions, the opposition Labor Party over the weekend decided to withdraw its support for oil exploration offshore the sensitive Lofoten islands in Norway’s Arctic, creating a solid majority in parliament to keep the area off limits for drilling.

The dramatic shift by Norway’s biggest party is a significant blow to the support the oil industry has enjoyed, and could signal that the Scandinavian nation is coming closer to the end of an era that made it one of the world’s most affluent.

How will Norway pay for its social safety network without oil revenues?


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  • (Score: 2, Informative) by quietus on Tuesday April 09 2019, @07:59AM (5 children)

    by quietus (6328) on Tuesday April 09 2019, @07:59AM (#826597) Journal

    Their investment fund is worth $1 trillion. Norway's social expenditure stands at about 25% of GDP, which was $398 billion as of 2017. All this combined means they'll need a 10% return year-on-year, presuming ordinary Norwegians do not pay taxes for social security.

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  • (Score: 2) by The Mighty Buzzard on Tuesday April 09 2019, @03:32PM (4 children)

    Yeah, and ten percent is asking a hell of a lot from your investment manager if losing your principle has to be avoided at all costs. Also, population growth and GDP growth would need to remain in lockstep, which is not remotely going to happen while they're getting so many unskilled refugees (who may or may not work at all) in as new population. It doesn't look good for them.

    --
    My rights don't end where your fear begins.
    • (Score: 2) by quietus on Tuesday April 09 2019, @06:23PM (3 children)

      by quietus (6328) on Tuesday April 09 2019, @06:23PM (#826975) Journal

      With that scale of investment fund, a yearly return of 7 - 8 percent would be on the conservative side.

      Note that we assumed, superficially, that all of that return would be spent on social security. Given that Norway's personal income tax rate runs at about 38 percent, of which slightly more than half is directed towards social security [tradingeconomics.com], it looks like that's not the case.

      • (Score: 2) by The Mighty Buzzard on Friday April 12 2019, @03:33AM (2 children)

        The thing is, "on the conservative side" isn't good enough when you're investing money that you can not afford to lose under any circumstances. As for the further math, you're right in that it needs considered but I'm too exhausted to think tonight.

        I notice you didn't address the fairly speedy influx of unskilled, low-earning immigrants though. As a general rule, unskilled immigrants tend to be a net drain on the economy for at least one generation, usually more but it is heavily dependent on a given demographic's cultural factors.

        --
        My rights don't end where your fear begins.
        • (Score: 2) by Reziac on Friday April 12 2019, @02:26PM (1 child)

          by Reziac (2489) on Friday April 12 2019, @02:26PM (#828606) Homepage

          Per the most recent stats I've seen, 4 out of 5 working-age males of the current migrant influx are on welfare. Plus their families (sometimes several of 'em apiece, four wives ya know), since naturally none of the women or children work.

          --
          And there is no Alkibiades to come back and save us from ourselves.
          • (Score: 2) by The Mighty Buzzard on Friday April 12 2019, @06:48PM

            Depending on the numbers, that could indeed be a serious problem, yes. Dollars to donuts that the "yay Scandinavian welfare" folks, who also happen to be the "yay open borders" folks will still be calling for both here in the US even if they get to watch first hand how it can bankrupt a nation though. Facts are apparently a social construct now. Or possibly racist.

            --
            My rights don't end where your fear begins.