O gadelhudo, caixa d’oculos de brinco na orelha que todos os dias entra no ministério das finanças sueco, Anders Borg, «does not see himself as a politician but as an economist that he isn’t bothered much by how others perceive him. Borg has advocated drug legalisation and, in keeping with his slightly hippie image, admits that he smoked pot in his youth. Perhaps this attitude explains why he had the courage to push through spending cuts and controversial tax cuts. Although scrapping a wealth tax and several property taxes was politically difficult at the time and lost his party some support, the results are paying political dividends. Unusually for someone in such a senior government position Borg, who is 44, doesn’t have an academic degree although he spent several years at university. Judging by his success, his time spent studying political science, philosophy and eventually focusing on economics was not wasted and led him away from a Keynesian view of the world. His view of how Sweden’s economy should work was undoubtedly also shaped by six years working in the banking sector before victory in the 2006 election led to his appointment as finance minister in the new centre-right cabinet.
Borg is bold. He refused to listen to those shouting down his approach at a time when the Obama administration was planning an enormous stimulus package and the whole of Europe seemed to be cheerleading for bailouts. He dismissed that approach and said the US President was wrong to risk future deficits to provide first aid to the American economy. He has been vindicated. Sweden’s economy is outperforming the rest of Europe and commentators all over the world are urging other finance ministers to take a leaf out of Sweden’s book.
Borg also understands how vital entrepreneurs are to recovery: he wants to encourage them to stay in Sweden and to stop capital flight. His decision to abolish his country’s wealth tax was a no-brainer on the basis of the numbers but hadn’t occurred to his predecessors. Research for the Swedish tax authority in 2002 found that capital flight from Sweden had amounted to 275 billion kroner since the beginning of the 1980s. Borg also grasps how critical welfare reform is. Sweden previously had very high welfare spending but that has been cut significantly on Borg’s watch. It was part of an agenda of spending cuts that he felt had to partner tax cuts. Borg might look as if he hasn’t had a haircut in a while, but he is not afraid to suggest that government spending should take one.»