Since World War 11, Mexico, Venezuela, Nigeria, and Kuwait have all experienced the euphoria-and the subsequent pain-that accompanied an explosion of national affluence produced by a sudden gush of oil or natural gas. Since the 1960s, when oil was discovered in the North Sea, politicians in Oslo have vowed not to squander the nation's new wealth, not to repeat the mistakes of others. In large part, they have suc- ceeded. Today, Norway's pristine landscape and its "quality of life" are intact. Rates of divorce, crime, and drug abuse are still low, even by Scandinavian standards. The Norwegians re- main committed to NATO and wary of their Soviet neighbors. Nonetheless, oil wealth has changed some things, notably the ability of Norwegian industries to compete in international markets. Here, our writers survey a Norway in transition, still trying to keep the rest of the world at arm's length, but clearly vulnerable to the political and cultural trends that have al- ready changed life elsewhere in the West.
PARADISE RETAINED
by Robert Wright
In the year 1000, Olaf Tryggvason, the Viking king, pre- pared to do battle against an alliance of Danish, Swedish, and Norwegian warriors. At stake was control of southern Norway, part of Olaf's plan for a unified, Christian nation. According to chronicles compiled two centuries later, the King approached the conflict with no fear of the "miserable" Danes, or of the Swedes, who, he said, might as well "stay at home and lick their sacrificial bowls." But from the fighters led by Earl Erik, he warned his aides, "we can expect a sharp battle, for they are Norwegians like ourselves ."
Ten centuries after the Battle of Svold (King Olaf was de- feated), tranquility reigns in Norway. But time has not extin-
The WilsonQuarterlyISpring 1984
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guished the Norwegians' ardent nationalism, nor dulled their sense of intra-Scandinavian rivalry. On any given day, the red, white, and blue national ensign flies from flagstaffs in tidy front- yard gardens from Kristiansand to Hammerfest. And, although the Norwegians now participate in numerous Scandinavian joint ven- tures, notably the Scandinavian Airline System (SAS), the prosper- ous Swedes still are the targets of unflattering, if lighthearted, remarks on the streets of Oslo and Bergen. "Do you know how to save a Swede from drowning?" one of countless ethnic jokes be- gins. "No," is the typical reply. The punchline: "Good."
A Model Nation
The conventional explanation of Norway's chauvinism draws on the past. Norwegians learn as youngsters that their country spent much of its history dominated by Scandinavian neighbors-under Danish control from 1536 to 1814, and under nominal Swedish rule until 1905, when formal independence was finally won. (Flags first appeared in front yards as an un- spoken invitation for the Swedes to vacate Norway.) Middle- aged Norwegians remember that during World War 11, Nazi occupation troops were sustained by supply trains that passed unimpeded through a neutral Sweden. And all Norwegian adults are old enough to know firsthand that Sweden and Den- mark have received most of the attention allotted Scandinavia by the international press since the war: The Swedes have stayed one step ahead of Norway in expanding the modern wel- fare state; Copenhagen's recent tolerance of sinful fun (to the chagrin of many Danes) has earned it a reputation as the "Paris of the North."
According to some analysts, history has thus instilled in Nor- wegians a certain insecurity. "You wouldn't think that there was any man in the world as brave and carefree as the Norwegian when he stands smiling or laughing, hands in his trousers' pockets and jacket nonchalantly unbuttoned, at the street corner, on the amateur stage, in the witness box," Agnar Mykle, the 20th-century Norwegian novelist, has written. "But women and critics and ex- aminers and judges and executioners will tell you that in his heart of hearts the Norwegian is full of uncertainty. . . ."
Yet, today, Norway boasts a combination of material secu- rity and "quality of life" found nowhere else in Scandina-
Robert Wright, 27, is an associate editor of The Wilson Quarterly. Terje I. Leiren, 40, a professor of Scandinavian studies at the University of Wash- ington, assisted in the preparation of this essay.
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NORWAY
"I shall paint living people who breathe, feel, stiffer, and love," wrote Edvard Mtlnch (1863-1944), Norway's famed artist, seen here in a self-portrait.
via--·or, perhaps, in the rest of the Western democracies. In The Moral Order (1983), Raoul Naroll, an American social sci-entist, assessed the countries of the world in 12 categories --ranging from per capita gross national product to per capita
combat deaths--in order to select a "model nation." He con-cluded, "Norway not only is the nation with ... the best over-all average on my 12 meters; of the four leading nations on my list it is also the best balanced." The macadam streets in Oslo are as close to spotless as streets can be. Citizens stride purposefully along the sidewalks. They are not generous with smiles and greetings, perhaps, but their eyes are not burning with tension, or vacant with aliena-tion, either. In winter, children who look as if they just stepped out of a first-grade primer--rosy cheeked, bright eyed, wearing wool scarves and mittens--frolic in the parks. But, in school or at home, they accede to the requests of teachers and parents without undue resistance. They will live to be older than citi-zens of almost any other nation, and it is no mystery why: They ski and hike, and the typical Norwegian's diet sounds like a pub- lic service message from the American Heart Association-fish, vegetables, fruits, whole-grain breads. Chocolate and coffee are the token vices. A Norwegian's idea of "junk food" is the white bread reserved for weekend festivities. Citizens partake of one of the richest smorgasbords of social
TI2e Wilso~ QuarrerlylSpri,?g 1984
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-------~--------~ss"---
entitlements found anywhere. Hospital care costs them nothing (except in high taxes). By law, workers get four weeks of paid va- cation per year. One-fourth of them own vacation homes. Those few who wind up unemployed receive more than half of their previous salaries while they seek new work.
A college education is free to all who can pass the stiff en- trance examination. Norway is a world leader in books pub-lished per capita, thanks partly to government subsidies. Newspapers, too, receive support from Oslo--both directly and through a ban on TV advertising. While three million people in Chicago, for example, must choose between two major daily newspapers, Oslo's 450,000 citizens can scan nearly a dozen.
The government also subsidizes the past. While all nations pay homage to tradition, few have taken such pains to preserve old ways of living as has Norway.
Buying Waterfalls
One example is Finnmark, Norway's northernmost county. There the 20,000 remaining Lapps are newly conscious of their ethnic heritage. Indeed, the word "Lapp," though still used in the American press, has been disowned by the Lapps, just as "Negro" was disowned by many blacks during the 1960s. Lapps now call themselves Same. Oslo pays to train Lapp-speaking teachers and helps support the 2,500 remaining reindeer herd-ers (thus securing the place of reindeer salami in the Norwegian diet). Government-backed linguists are gently updating a lan-guage that has 120 descriptive words for snow but few for mod- ern technology.
In spite of the government's generosity, Norway's solvency is not in doubt. And it never was. As economic problems mounted for Denmark and Sweden during the 1970s, Norway was exempted from alarums about the "crisis in Scandinavian socialism." By the fall of 1983, Norway had the lowest unem-ployment rate--3.1 percent--in Scandinavia. It is a sign of Nor- way's prosperity since World War II that the opposition Labor Party has seized on such a modest jobless rate in trying to mobi- lize public opinion against the ruling conservative coalition.
Moreover, Norway seems to have resisted the side effects of postwar affluence and urban growth which, in Denmark and Sweden, have eroded the conservative Lutheran tradition that
the three nations share. Its divorce rate is the lowest in Scandi-navia-and one of the lowest in the West. Its murder rate is one-fifth of Sweden's and one-third of Denmark's. In many small Nbrwegian towns, front doors are never locked. And, notwith-
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NORWAY
standing the morbid themes conveyed by Norway's most fa-
mous painter, the turn-of-the-century expressionist Edvard
Munch, Norwegians tend not to succumb to the suicidal depres-
sions that stereotypically afflict Scandinavians. The nation's su-
icide rate is about one-third of Denmark's and is less than
Sweden's by almost half.
Theories differ as to why Norwegians are not prone to
taking drugs, divorcing their spouses, or killing themselves or
each other. Less puzzling is their success in building a welfare
state virtually impervious to economic shocks. While hard
work and careful planning have been essential, so has Nor-
way's natural endowment of energy--first hydroelectricity,
and now North Sea oil. At the beginning of the century, when England, the United States, and other coal-rich countries were already reaping the rewards land suffering the pains) of the industrial revolution, a young Norwegian engineer named Sam Eyde began buying up mountain waterfalls. After Eyde's hydro-powered factory in Rjukan began producing fertilizer, legions of capitalists fol-lowed in his footsteps. The resulting industrial base--alumi-num smelters, paper mills, wood pulp factories, all run on "white coal"--financed the expansion, during the 1950s and 1960s, of the Labor Party's welfare program: Fo~ketrygden ("the people's security"). Today, Norway produces more electricity per capita than any other nation. The oil discovered in the Norwegian sector of the North Sea during the 1960s has helped keep Folketvygden intact, and the economy close to full employment, even in the worst of times. Today, petroleum accounts for 17 percent of Norway's gross na-tional product and one-third of its exports. During 1981, oil lev- ies brought in $4 billion--about $1,000 per citizen.
Like the Scots
But oil worries some Norwegians. It attracts foreign labor-ers, European financiers, American technical advisers, and, above all, lots of money. In 1970, before commercial drilling be- gan, Norway's GNP per capita was 71 percent of Sweden's. By 1980, the figure had grown to 93 percent. Oil threatens to make Norway look more like Sweden, Denmark, and the rest of the in-
dustrialized world than its citizens would like.
Except for the explosive extroversion of the Viking age (800-1066) and the massive emigration from Norway to Amer- ica during the 19th and early 20th centuries (see box, pp. 120-121), Norwegians have more or less kept to themselves (al-
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NORWAY
THE NORWEGIAN-AMERICANS
Only Ireland contributed a greater share of its population to the American immigra-tion Of the 19th and 20th centuries than ·IB~i~ did Norway. Some 800,000 Norsker--driven by scarcity, drawn by the promise of cheap, fertile land and by the American ide-als of egtlality and liberty--became U.S. citizens between 1825 and 1925. They set- tled mainly in the Midwest--Minnesota, Wisconsin, the Dakotas. Among then~ were OIe Evinrtlde, who built the first commer-cially successful outboard motor, and WalterF.Mondale
Kntlte Rockne, Notre Dame's football coach during the 1920s. Former Vice President Waiter F. Mondale's last name is the Anglicization ofMundal, the village on the Sogne Fjord in southwestern Norway from which his great-grandfather, Frederick Per-son Mtlndal, emigrated to Minnesota in 1856. Here, drawn from the es- say, "Letter to a Grandfather I Never Knew," is irV commentator Eric Sevareid's sober 1975 tribute to immigrant Erik Erikson Sevareid:
... You were at ease with the word "duty." You knew there could be no rights and privileges without responsibility. You found it natural to teach probity to your children, and self-denial, so that others, too, could have elbow room in which to live. You blamed yourself for misfortune, ~~s: not others, not the government.
You knew what was known by ancient philosophers you never read--that civi-lized life cannot hold together without these values. Now, some speak of them as
Eric Sevareid the "puritan ethic," as a curious, out-
moded illusion. But you were not wrong.
You knew your values were right because you carried to the new land no evil cargo of hatred or guilt. You and your contemporaries were freemen born, not slaves or serfs. You had much to learn but little to forget.
though 28,000 of them roam the seven seas aboard the world's fifth largest merchant fleet). The Norwegian gene pool is consid- ered the most homogeneous in Western Europe. By one reckon-ing, two-thirds of the people have pure blue eyes. Even today, ordinary residents of Drammen or TromsO may point and stare upon seeing a black man. Like the Scots, Norwegians are not
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NORWAY
Now there are some who believe your sojourn was in vain. That
you and the others sought freedom and equality but found neither.
You knew such things are not found but created. This grandson be-
lieves that is what you did. I have seen much of the world. Were I
now asked to name some region on earth where men and women live
in a surer climate of freedom and equality than that northwest re-
gion where you settled--were I so asked I could not answer. I know
of none. What you built still stands upon that prairie.
We are not entirely sure, anymore, that it will stand forever. You
thought of democracy as natural; but it is far from certain that any
law of nature will preserve it. In nation after nation, the people find
it too difficult. They cannot combine justice with order, nor free
thought and speech with life in unity.
The capacity to do this developed, in modern times, among the
men and women who lived in the rocks and forests from which you
came, and in other lands washed by the waters of the North Sea.
The secret of democracy was made manifest there. It was nur-tured in the wooden churches, propagated in the small, clustering towns and the growing cities, passed on through the school rooms and the books. The secret was the knowledge that each man is his brother's keeper.
The secret knowledge is still manifest in those North Sea-lands. It is still manifest in this new land, now growing old.
But it is in danger. We have been careless of what you bequeathed us. We have allowed self-interest to sicken the American idea. We have rotted some of it away by surfeit and indifference, and wounded it by violence.
We know that this society remains the central experimental laboratory in human relations. Success moved with you in this direction. There is a fear that failure here would spread eastward, back to the origins of success.
But not all the dangers have their origin here. Great wealth can poison life as we here have learned. And great wealth from beneath your native sea threatens the ways of life that have held so steady, so long, in your native land. The people see the danger. They know from our heedlessness here what could happen to them. A test of foresight and common sense is in the making. Norway, now, will become a critical experiment, testing man's capacity to live the life of reason under enormous contrary pressures. We and the world will watch and perhaps we will learn.
known for their friendliness to foreigners. (Whether their re-serve reflects shyness, complacency, or hostility is a matter of debate among foreign travelers.) Nor do they embrace foreign ideas, or products, readily. In few Western nations did manufac- turers of paper milk cartons fight a longer, tougher battle to re- place glass bottles than they did in Norway.
TI~E lyilsol? Vrta,~rel~l\~iSl~,i,zg 1984
121
Norway's reclusiveness is grounded in climate and geogra-phy. The spectacular mountains in the east, the open seas to the west and south, the ice to the north, and the long winters do not add up to a natural invitation to foreign visitors. In The Scandi- naviavrs (1966), Donald S. Connery wrote, "It is almost as if the weary and sophisticated Continent had set Norway apart as a national park or royal preserve and had appointed the Norwe- gians as custodians to keep the waters clear, the mountain snows untouched by industrial soot, and the wonders of nature unspoiled by thoughtless trespassers."
The greater part of Norway is rugged and inhospitable. Two-thirds of the territory is more than 1,000 feet above sea level, and only three percent is arable. Nearly half of Norway is within the Arctic Circle. The flip side of the "midnight sun" is the "noontime moon"; in Hammerfest, the sun is not seen at all between November 21 and January 23.
Staying Aloof
Not surprisingly, most Norwegians have chosen to settle along the shores in the south; there they are only as far north as sotlthem Alaska. Four of five live within 10 miles of the sea, near one of the fjords which, together, make the length of the Norwe- gian coastline a matter of definition. Overflying it by airplane, one would cover about 1,650 miles. Traversing it by foot tan im-possible feat for all but the expert cliff-climber) would be a jour- ney of 10 times that length.
Norway is larger than Michigan and Illinois combined, and its population of 4.1 million is only the size of greater Detroit's. So there is some room to spread out even without climbing mountains. Four Norwegians in five live in one-family houses.
The white, wooden, two-story houses in Norway's seaside villages would look at home in Middletown, U.S.A., but there they would be arranged more coherently. Around the typical fjord, what land there is between water's edge and mountain's base offers foothills, jagged boulders, and various other geolog-ical enemies of order and symmetry. Main Street is often a nar- row lane snaking through town, rather than a broad, straight thoroughfare. Homes and shops--wedged between boulders, straddling knells--form a crazy quilt covering what little flat and near-flat land nature has provided. Only in the broader val-leys, notably around Oslo, can the Norwegians build exurbs that
match those of Sweden or the United States. The pleasures of exurbia were a long time in the winning, a
fact that has not escaped the attention of many Norwegians. In
Tlte Wilson Quarle,SISprir2g 19S4
122
Norway's fjords, some nearly a mile deep, were formed dtlring the Qtlater- nary Period of the Ice Age, less than 2.5 million years ago, as glaciers deepened and broadened existing river valleys.
Returning to the Future (1942), Sigrid Undset, winner of the 1928 Nobel Prize in literature, wrote, "If any people in the world owns its land with honor and right, has conquered it, not from other people, but in obedience to the Creator's stern command-ment that man shall eat his bread in the sweat of his brow, it is we Norwegians who call Norway our country."
Alone for centuries, aware of the evolution of Europe but largely untouched by it before World War II, the Norwegian people have come to view the world with a curious mixture of detachment and compassion.
While belonging to NATO, Norway keeps its distance from the Alliance, refUsing to permit the stationing of allied troops on its soil (see box, pp. 134-135)." The nation has been aloof in other re-spects, too. In 1972, some 53 percent of the electorate voted not to join the European Economic Community--fearful, perhaps, that integration would adulterate the national character, and confident
*Nonvay actively supports peace and world order. A 700-man Norwegian battalion now serves in a United Nations peacekeeping force in southern Lebanon. Norway provided the first secretary-general of the United Nations, Trygve Lie, who backed U.S. efforts to repel Communist aggression in Korea in 1950.
7'he Wilson QIlarrerlylSpriMg /984 123
that North Sea oil would make Norway a sought-after trade part-ner with or without Common Market membership.
Yet, Norwegians seem to relish participation-albeit vicarious--in the great global controversies of the day. South Africa, Afghanistan, or Central America may provoke as much parliamentary rhetoric and dinner-table conversation as the possible demise of a local fish cannery. In 1799, when the En- glish economist Thomas R. Malthus visited Norway, he re-corded in his diary: "I talked with a Mr. Nielsen who was a great Democrat and admirer of Thomas Paine. He abused a great deal the English government for their interference with the French--thought that Kings were now receiving a proper lesson, and that the light of the French revolution could never be thoroughly extinguished."
Today, Norwegians are likely to share Mr. Nielsen's senti- ments. Reflecting Norwegian history, they tend to come down on the side of national self-determination and against the big outsider, Eastern or Western.
Similar sympathies apply in domestic matters. Underly-ing the long popularity of the Labor Party is a deeply in-grained antipathy toward the "haves." Serfdom did not gain a foothold in Norway during the Middle Ages, and in 1821, seven years after the end of Danish rule, the Storting (Parlia-ment) abolished all titles of nobility. Norwegians agree on one point, wrote the Norwegian playwright Henrik Ibsen: They should "drag down what is most lofty." Today, a man without a family or a tax shelter must give the taxman 80 cents of each dollar he earns over $50,000.
The cost of mandated equality has begun to worry many Norwegians. In 1981, they went to the polls and gave the Con- servative Party its first electoral triumph in 53 years. The Con- servatives, led by Prime Minister Kaare Willoch, are now in the unaccustomed position of seeing the youth vote--long a prop- erty of the Left--siphoned off by parties to the right.
Candy Cigarettes
The most notable of these, the Progress Party, was formed
only 10 years ago amid a tax revolt. The party has been com-
pared by local analysts with the "Reagan Republicans"--a bit
off the mark, perhaps; in Norway, "right wing" translates as
"left of center" on the American political spectrum. Still, the
Progress Party's leader, economist Carl I. Hagen, does echo the
Reaganites' calls for drastically scaled down government, less
regulation, and simpler solutions to social problems. His party
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NORWAY
has endorsed exiling drug offenders to the Arctic island of Spits-
bergen and shrinking Norway's tomes of legal codes to the size
of a pocket diary.
The Conservative Party and parties to its right collected 40
percent of the vote in 1981. In 1969, the Conservative Party gar-
nered 19 percent; then there weve no parties to its right.
Part of this conservative resurgence was simply a matter of
being in the right place at the right time--out of power during
the worldwide "OPEC recession" that began in 1974. Half of
Norway's GNP comes from exports (mainly oil, shipbuilding,
and shipping), so the governing party will always reign at the
mercy of global economic ups and downs.
Conservatives have also profited from popular reactions to the Labor governments' relentless expansion of the welfare state and their passion for high taxes and economic regulation. As Oslo borrowed against future oil revenues to ward off bad eco-nomic times, the government came more and more to be the
economy's chief actor. Between 1977 and 1981, some 85 percent of all new jobs were provided by the state or by municipalities. Today, 47 percent of Norway's GNP ends up in the coffers of the national, county, or municipal government (versus 49 percent in
~BI~WT~ IN THE IEAW~ By O.E.RijLYAAG
Ole Edvart Ralvaag's 1927 novel about Norcl,egian settlers in the Midwest has become a minor American classic. Riilvaag (1876-1931), an imnzi- grant who attended St. Olaf College ilz Northfield, Minn., founded the
Nonvegian-American Historical Association.
The Wilson Quartel~lylSpring 1984
NORWAY
Sweden and 32 percent in the United States). At government- run liquor stores, taxes drive the price of a fifth of scotch to $35.
Under the Labor Party, Oslo's paternalism sometimes
reached comical proportions. A law introduced in 1975 would
have made it illegal not only to advertise cigarettes in the
newspapers, but also to sell candy cigarettes to anyone under
16. (The law passed, but not until it was stripped of the latter provision.)" Willoch did not enter office in 1981 with a sweeping man-
date for change, and he knew it.'Norwegians are not tired of the welfare state,' he told reporters."But they know you cannot pay for a welfare state without economic growth, and you cannot have economic growth with taxes as high as ours."
Thus far, the Prime Minister has found it hard to follow even his own modest prescription. With unemployment rising (the number of jobless grew from 28,000 in late 1981 to 68,000 in late 1983), reducing state outlays has proven difficult. Willoch has cut income taxes marginally, but has raised the sales tax on new cars--which already ranged between 100 and 200 percent. The betting in Oslo is that the Labor Party stands a good chance to regain control of the Storting in 1985.
No to Cohabitation
Norwegian political pundits are debating not just whether 1981 marked a long-term drift to the right--but whether it marked the erosion of the middle ground. The Center Party, the Liberal Party, and the Christian People's Party, which stand be- tween the Labor and Conservative parties on the ideological spectrum, have seen their share of the vote shrink considerably over the past decade.t
The three parties of the center have long drawn their strength from Norway's hinterland, thriving on long-standing differences between city slickers and country folk. But between 1960 and 1980, the urban share of the population grew from 32
percent to 43 percent.
*The government's war on vice is often waged more conventionally. In a land where "lost weekends" provide an escape from tranquility for many workers, drunk-driving laws are re- putedly the toughest in the world--and are well obeyed. Driving level
with a blood-alcohol of 0.5 percent, which in many U.S. states is considered proof of sobriety, draws a minimum penalty of three weeks in jail.
tPolitical polarization, if it grows, could add to recent strains on the nation's long habit of seeking consensus. Management-labor negotiations, often government-mediated. have tra- ditionally been civilized affairs. In 1972, there were only nine industrial disputes lasting more than one day. They involved a total of 12,000 workers. But in 1981, more than three times as many workers engaged in twice as many strikes.
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NORWAY
RESISTING THE NAZIS
During the early hours of April 9, 1940, German warships crept into
the harbors of Narvik, Trondheim, Bergen, Stavanger, Kristiansand,
and Oslo. For the first time in World War II, Hitler had launched an
invasion without first issuing an ultimatum.
At peace for 125 years, Norway had only 7,000 soldiers to protect
her neutrality. Allied reinforcements were too little and too late. The
Nazis soon controlled all of Norway. But amid growing repression
and economic hardship, the Norwegian people began a dogged re-
sistance campaign that remains a source of national pride.
The brief defense of Oslo Fjord proved crucial. There, coastal artil-
lerymen sank the cruisers BZiicher and Briimmer. The Germans, sur
prised, were held at bay for eight hours, allowing King Haakon VII
to escape to the north. From England, he led the resistance.
Norwegians listened to his speeches on contraband shortwave radios hidden in their basements. Young men fled to the forests to escape forced labor for the Nazis, and some became expert saboteurs. The Norwegian underground blew up railroads and helped British commandos destroy heavy-water plants at Rjukan that Hitler had hoped ~ would help the Third Reich produce an
atomic bomb. Haakon requisitioned all Norway's mer-chant ships abroad--most of the 4.8-million-ton fleet--and placed them in Allied service. Some 3,600 Norwegian sea-men died during the war. The Nazis appointed Vidkun Quisling,
founder of Norway's unpopular fascist Na-
tional Union Party, as "minister president"
of Norway. Quisling tried to turn churches I~idkunQuisling
and schools into founts of Nazi propaganda.
(Until Hitler invaded the Soviet Union in 1941, Quisling's chief local
supporters included the Communists.)
On Easter Sunday, 1942, most of the nation's clergymen resigned. Many escaped to neutral Sweden. Some 1,300 teachers who refused to use Nazi texts were sent to a concentration camp at Grini. Thou-sands of other Norwegians were arrested by the Gestapo.
In the spring of 1945, King Haakon greeted with reserve the news of German offers to capitulate. "Dignity, calm, discipline," the king exhorted from London. Nonetheless, he received a properly jubilant reception upon his return to Oslo.
Quisling was tried and executed. Today, his name lives on in Eng- lish and Norwegian dictionaries as a synonym for traitor.
The Wilson QuuuleulylSprir?g 198$ 127
At the same time, the contrasts between urban and rural
folkways have diminished. The Christian People's Party had
long benefited from the tendency of rural Norwegians to answer
with an emphatic No such questions as: Is cohabitation without marriage morally acceptable? Should the state continue to pro- vide free abortions, no questions asked? But these days, abor- tions and premarital cohabitation raise fewer eyebrows, even in remote villages. The Christian People's Party lost seven seats in the 1981 election."
Roughing Up the'Pakies'
For much of this century, Norway's "language problem" has aggravated rural-urban tension, and, hence, provided sup- port for the parties of the center. Until 1852, the only written Norwegian language was Riksmaal---the "administrative" language, with a heavy Danish flavor, imposed by the Danes
centuries earlier and spoken mainly in the cities. During the early 1800s, Ivar Aasen, a peasant and self-educated linguist, set out to codify the native Norse tongues spoken in the upland valleys. Lacking a single model, he wove dozens of dialects into a synthetic "genuine" language, "Landsmaal." This artificial vernacular was adopted widely in rural areas during Norway's late 19th-century cultural renaissance, having been propa-gated by such artists as the novelist Arne Garborg and the poet and journalist Aasmund O. Vinje. The result was a linguisti- cally divided nation.
However, urbanization appears to be dimming the pros-
pects for Landsmaal. Today, only one in six elementary school children speaks it regularly. And the distinction be-tween the two tongues is blurring somewhat. Partly because programs in both languages are broadcast nationwide, TV in Norway--as in the United States---is serving as the great cul- tural homogenizer. The average Norwegian spends nearly two hours per weekday watching TV--half the average Amer- ican's television time, but much more than that of the average
Norwegian two decades ago.
The electronic media may also bring Norway into the main- stream of modern mass culture. American movies---with Nor-wegian subtitles---have long appeared on television. Now, with
"In theory, the Norwegian constitution would lend strength to a religion-based party such
as the CPP.It mandates that "the Evangelical-Lutheran religion shall remain the official re- ligion of the State. The inhabitants professing it are bound to bring up their children in the same." But Norvegians have complied with the letter, more than the spirit, of this dictum. Today, while nine in 10 citizens are baptized in the Lutheran Church, only one in 10 goes to 10 or more services a year, and half attend none at all.
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NORWAY
the advent of cable TV, viewers are exposed to an unpredictable
array of imported distractions.
Other foreign influences are at work. Since the oil boom hit Norway in the mid-1970s, visions of good wages and equitable treatment have drawn Pakistanis, Turks, and other "guestwork-ers." The government has treated them humanely, extending to them the welfare benefits enjoyed by natives. Some natives have not been so kind. Juvenile gangs in Oslo or Trondheim some-times rough up the "Pakies."
To date, no more than 10,000 Pakistani guestworkers have immigrated. Only in a country of Norway's ethnic homogeneity could such a small-scale influx attract so much space and dis-cussion in the newspapers. Similarly, levels of youth crime and drug use that many American big-city mayors would welcome stir anguished debate among Norwegians.
An article titled "Norway Breaks into the World of Violent Crime" appeared in the Nouseman two years ago. The writer noted that Oslo's murder rate had doubled in 1981; in a single weekend, three women had done away with their husbands. And a nursing home director had admitted to killing no fewer than 27 of his patients.
Even so, the author remarked, Norway's crime statistics stand up well in international comparisons. "Paradise," he con- cluded, accurately, "is not yet lost."
Tl~e Wi~ron QtlunerlyiSpl-ing 1984
COPING VVIT)I OIL
In 1965, when Esso secured the first license from Oslo for
offshore oil exploration, hopes ran high that the North Sea fields
would provide a stable source of energy for the West--and a sta-
ble source of income for Norway.
By the autumn of 1969, those hopes were fading. More than
200 exploratory wells dotted the seabed between Norway and
Britain, and none had yielded enough petroleum to warrant
commercial development.
In December, workers on the Phillips Petroleum drilling rig "Ocean Viking" suddenly struck oil 180 miles off the Norwegian shore, two miles beneath the ocean floor. By 1971, Phillips was extracting 40,000 barrels per day from "Ekofisk"--a dome-shaped formation of limestone eight miles long and four miles
wide. Within a few years, the North Sea would rank second only to the Middle East in "proven oil reserves." One-third of those reserves were under Norway's waters.
But there was no dancing in the streets of Oslo. The Norwe- gians, for the most part, reacted soberly to their windfall. Prime Minister Trygve Bratteli of the long-dominant Labor Party warned in 1974 that Norway's undersea blessing could become a curse; oil wealth had to be handled judiciously. The nation, he vowed, would not allow revenues from oil and natural gas to overheat the economy. It would not let the petroleum business dis- place traditional export industries, such as shipbuilding and for- estry, leaving the country's prosperity hostage to fluctuations in
the worldwide demand for energy. Only with great patience and
self-discipline, he cautioned, could his fellow countrymen parlay
their new-found inheritance into a sound economic future.
Oil Minister Ingwald Ulveseth concurred. "It is not our aim that every Norwegian have big automobiles," he told a corre- spondent for Dtrn's Review in the summer of 1974. "And we
don't plan to become sheiks with golden furniture and so on. That's not the Norvegian way."
Yet, by the late 1970s, some Norwegians were caustically referring to their homeland as the "Kuwait of the North." The Economist, a British newsweekly, declared in 1978 that "the Norwegian nightmare of oil wealth drowning the existing indus- trial base is becoming a reality." Indeed, although oil money has kept Norway prosperous amid global recession, the underlying health of the Norwegian economy remains in doubt even today.
Ttle Wilson Qunvteul~,lSpn't?g 1984
130
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NORWAY
ganization of Petroleum Exporting Countries (OPEC) had raised
the price of crude oil from $3 a barrel to $5.
The social repercussions of sudden wealth were also becom- ing evident. In the port city of Stavanger, shipbuilding and engi- neering firms hired Swedish and Finnish laborers to replace Norwegians lured out to oil rigs by pay three times as high as their wages on the mainland. Storeowners stocked their shelves with French's Cattlemen's barbecue sauce to please the palates of roustabouts and oil executives from Texas and Oklahoma. In three years, the price of housing in Stavanger doubled.
A Buffer Against Pain
The academics and politicians who wrote the 1974 white pa-per worried that unbridled exploitation would entail more seri-ous dislocations. Norway's unemployment rate then hovered around one percent. With no slack in the economy, an influx of oil money could bring rampant inflation. The Labor government thus advocated a "moderate tempo" for drilling and argued that a large fraction of the revenues should be invested abroad. The oil money would be "exported" as loans to countries better able to absorb it. The Storting endorsed the proposal.
The ink on the white paper had hardly dried when Bratteli decided, in effect, to ignore the plan. The reason: The optimistic economic forecast on which it was based appeared less realistic with each passing day. As 1974 progressed, Norway began to feel the pinch of the OPEC-induced worldwide recession. Layoffs hit the shipping, shipbuilding, forestry, and fishing industries --all dependent on exports. Although the unemployment rate had not risen even to two percent, Labor Party leaders agreed that a new economic policy was in order.
Finance Minister Per Kleppe decided to use oil revenues as a buffer against the pain. And, since Norwegian oil was not yet flowing in abundance, the anticipation of oil revenues would
This essay is adapted by permission of the p~blisher from Petroleum and
Economic Development: The Cases of Mexico and Norway by Ragaei EI
Mallakh, IZlystein Noreng, and Barry W. Poulson. (Lexington, Mass.:
Lexington Books, D. C. Heath and Company, Copyright 1984, D. C. Heath
and Company). Ragaei EI Mallakh is professor of economics at the Univer-
sity of Colorado, Botllder, and enectitive director of the International Re-
search Center for Energy and Ecolzomic Development. 1Zlystein Noreng
teaches at the Norwegian School ofManagen2ent, Oslo, and is research di-
rector of the Institt~te of Energy Policy. Barry Potllson is professor of eco-
nonzics at the University ofColorado, Boulder.
Tl~e Wilson QuarterlylSpring 1984 132
NORWAY
have to serve. Drawing on Norway's Triple A credit rating, the
government would borrow enough money to stimulate the econ-
omy. When the oil began gushing, the debts could be repaid. The
Storting approved the plan unanimously. Borrowing abroad,
particularly from U.S. banks, accelerated. The 1974 white paper
had called for channeling about 6 billion kroner of petroleum
revenues into the Norwegian economy each year and sending
the rest abroad. In fact, roughly twice that much annual domes-
tic spending was financed by borrowing against untapped oil re-
serves between 1974 and 1977.
Much of the money went to prop up ailing industries. Subsi-dizing "endangered" enterprises, such as farming, had long been government policy. As the list of the needy grew, the cost of that policy soared. Oslo paid shipowners to mothball idle freighters rather than sell them at a loss abroad. Paper, alumi-num, and steel mills kept producing in spite of sagging demand, secure in the knowledge that the government would pay them to stockpile their excess output until markets revived. By the be- ginning of 1978, about one-fourth of Norway's manufacturing jobs depended on direct government subsidies.
Blue-eyed Arabs?
Superficially, the borrowing plan seemed to work. From 1973 to 1980, full-time employment grew at an average of 1.3 percent annually---more than twice the historical rate. The quarterly rate of unemployment never edged above the 1.6 per-
cent it reached in 1975.
The standard of living also rose. In early 1978, a visiting New York Timesman reported that Oslo "reflects prosperity at every turn: Mercedes Bent taxicabs, shops bulging with fancy imported goods, and well-filled restaurants where the prices on the wine list look like telephone numbers."
Indeed, prices had jumped by 9.2 percent in 1977. More im- portantly, wages were rising faster still. Since shipbuilding and metallurgy firms were paid, in effect, to hoard labor, and the oil business consumed more and more man-hours, unions found themselves in a strong bargaining position. Real wages in the man- ufacturing sector rose by one-fourth from 1974 to 1977.
Also contributing to wage inflation was the infusion of gov- ernment cash into the welfare system. Retirement pensions, aid to the handicapped, and other benefits became more generous. New hospitals were built, principally in rural areas. Doctors, nurses, and a host of new bureaucrats swelled the government payroll. Between 1973 and 1981, public employment grew by
Tile Wilsol? (2uuuterlylSpring 1984
NORWAY AND NATO
Two NATO members-Norway and Turkey-share borders with the Soviet Union. Sixty miles east of the Norwegian frontier lies Mur- mansk, home base for more than 400 Soviet naval vessels, including two-thirds of Russia's ballistic-missile submarines. This reality, Western analysts suggest, underlies Norway's importance in any conflict between the Soviet Union and the NATO nations.
"World War Three may not be won on the Northern Flank," Amer- ican military commentator Robert Weinland has written. "But it could definitely be lost there."
In the event of a non-nuclear war, NATO could use listening posts in northern Norway to help track Soviet naval movements. Therefore, the Soviet Union, as NATO analysts see it, would begin any attack on West- em Europe by trying to subdue Norway. That accomplished, Norway's dozen airfields and its sheltered fjords-kept ice-free by the Gulf Stream-could variously serve as staging points for air attacks on Brit- ain or Central Europe or submarine forays against supply routes be- tween Europe and the United States.
Advancing Red Army ground troops would encounter unfriendly terrain in northern Norway. The roads snake through easily de- fended mountain passes which, Norwegian military planners hope, would help stop Soviet armor columns. Each of the two 13,000-man Russian motorized rifle divisions routinely based on the Kola penin- sula already includes 266 tanks.
In wartime, Norway would rely on NATO reinforcements, its own American-made F-16 fighters armed with locally produced Penguin missiles, and a small but agile navy, consisting mainly of corvettes, fast attack craft, and small submarines. Within 48 hours, 225,000 re- servists could be mobilized. But the first shock would be borne by only 42,000 active duty troops-mainly one-year conscripts.
180,000, or 60 percent, further increasing the demand for labor.
Normally, companies competing in an international mar- ketplace would feel the effects of higher labor costs immedi- ately; forced to raise prices, they would lose business at home or abroad to more efficient foreign firms. But government subsi- dies insulated Norwegian industrialists from such painful reper- cussions. With a guaranteed market at home, they could afford to lose customers elsewhere. They did-in textiles, paper, and metals. Not until 1983 did exports of "traditional" goods climb back to 1973 levels. Meanwhile, worldwide demand for such products had grown by 30 percent. Norway had missed the boat.
Subsidies also left managers with little incentive to keep abreast of changing technology. Even as computerized record- keeping and automated production swept Japan, Western Eu- rope, and the United States, the Norwegian government, in
The Wilson QuarterlyISpring 1984
134
Like Denmark, Norway has long prohibited the stationing of NATO troops and nuclear weapons on its soil. When NATO conducts joint exercises in Norway, allied forces are normally kept at least 300 miles from the Soviet border.
Such caution is partly a vestige of Norway's traditional neutralist sentiment and partly the result of an implicit bargain with Moscow. As a quid pro quo, some Western analysts believe, the Russians have limited troow dewlovments near the ~orwe~ian
border. But a recent Soviet build-up on the Kola Peninsula, as well as continuing disputes over boundary lines in the oil-rich Barents Sea, have made Oslo re-examine its neighborly policy. Last spring, a Norwe- gian frigate fired 10 rockets at . -an unidentified (but probably Soviet) submarine submerged in Hardanger Fjord. Despite Mos- cow's protests, the government has permitted the U.S. Marines to "pre-position" equipment in central Norway.
Soviet-backed repression in Poland and Afghanistan has also chilled Norway's relations with Russia. Many Norwegians see U.S. policy in faraway Central America as no better. Antinuclear protests by young Norwegians are aimed at both superpowers.
But most middle-aged Norwegians, remembering the Nazi inva- sion in World War 11, endorse the Western Alliance. One poll found that more than 80 percent of all adults back continued NATO mem- bership. Indeed, William Bogie wrote from Oslo last year in National Defense, "It is impossible to start a real debate on the subject."
effect, discouraged innovation. And the "boom" atmosphere may have eroded the national tradition of pride in one's work. If, as it seemed, oil offered a better life for less effort, why should employees exert themselves unduly? Already in 1978, a Norwe- gian economist, sensing the broader implications of the govern- ment's "countercyclical" policy, remarked that 1977 had been "a good year for Norwegians, but a bad year for Norway."
Worse still, the oil revenues against which Norway's leaders had mortgaged the country's future were slow to materialize.
To be sure, the government had cut itself a big slice of the pie. One provision of the 1974 white paper was faithfully fol- lowed. Oslo insisted that the multinational coroorations that had mapped out and searched the ocean floor play second fiddle when harvest time came. The government's zeal in dealing with the oil giants earned Norwegians the nickname "blue-eyed
The Wilson QuarterlyISpring 1984
135
Arabs" among some of their multinational partners.
The government created its own oil exploration and recov- ery firm, Statoil, in 1972. Within a decade, Statoil would grow to be Norway's second largest corporation in terms of reve- nues-thanks largely to the enterprise of American oil compa- nies.;' It was given the option of claiming at least 50 percent of each petroleum find, regardless of whether it had invested in the search. (Even when Statoil located and retrieved oil unassisted, it had foreigners to thank; Statoil president Arve Johnsen hired a former Chevron executive to head the company's exploration program and a former Shell officer to oversee drilling opera- tions.) In 1975, the government passed a steep tax on windfall petroleum profits. Between that levy and standard corporate taxes, Oslo aimed to take about 70 percent of net profit.
Neglecting Reality
But during the mid-1970s, there was precious little to tax. Facing long winter nights and storms that pushed waves as high as 80 feet, the oilmen found the job more time-consuming than expected-and more costly, in both financial and human terms. By the spring of 1977, accidents had claimed the lives of more than 80 workers on the North Sea oil rigs.
In that year, production reached only 107 million barrels, roughly half of what Oslo had projected. By midyear, the com- fortable budget surplus that the government had expected by 1978 was nowhere in sight. The Ministry of Finance quietly pushed the date of the anticipated bonanza forward to 1981. During the spring of 1978, foreign debt reached $20 billion, equal to half of the gross national product. Norway now had the highest debt ratio ever attained by a member of the 24-nation Or- ganization for Economic Cooperation and Development.
The government's profligate ways drew fire not only from Conservatives, but also from Social Democrats. By 1978, Prime Minister Odvar Nordli of the Labor Party had decided that it was time to shift gears. He stepped up petroleum licensing, cut back on public spending, devalued the krone (which today is worth about 13 cents), and imposed a 16-month wage and price freeze-despite claims from spokesmen for leftist fringe parties that such measures constituted "the biggest treason since [that
+The government owns 100 percent of Statoil and appoints five of its seven directors; the other two are elected by Statoil's 3,000 employees. Norsk Hydro, the 51-percent state- owned company founded in 1905 to harness hydroelectricity, is the largest company in Nor- way. It manufactures fertilizer, processes metals, and now competes with Statoil for oil business. Saga Petroleum, a private firm, is the third major Norwegian oil company.
The Wilson QuarterlyISpring 1984
136
Norwegian cartoonist Finn Graf depicts the impact of oil wealth on Oslo. Norway's urban population grew by one-fifth between 1960 and 1980.
of the quislings in] the Second World War." This austerity pro- gram yielded some immediate benefits. Between 1977 and 1980, a trade deficit equal to 10.8 percent of the GNP was replaced by a surplus of 4.8 percent. And since 1980, accelerated oil produc- tion has begun to pull Norway out of debt.
But much damage has been done. To this day, Norway's in- dustrial competitiveness lags. The loss of world market shares in shipbuilding and aluminum production continues.* Knut Lofstad, president of the Union of Industries, Norway's employers' organi- zation, declared last year that "Norwegians have gradually devel- oped a tendency towards neglecting the economic realities."
In the end, the Labor government created what it had at first tried to avoid-an economy, and a welfare state, addicted to oil revenues. The result was a sluggish private sector, more dependent than ever on government subsidies.
Yet, it would be wrong to lay all the blame for the obsoles- cence of Norway's manufacturing industries at the feet of the
*Oil is, however, spurring a few companies to new heights. Aker, a Norwegian shipbuilder, had by 1975 become the second largest oil rig builder in the world, breaking the longtime American monopoly of that business. And Statoil is gearing up for what its chairman, Finn Lied, has called "the Norwegian man on the moon projectu-drilling in the Troll field, which lies under 984 feet of water.
The Wilson Quarterly/Spring 1984
137
Labor Party. Partly, the problem is one of culture.
Norway is an old, highly homogeneous Scandinavian society that places a premium on social and economic equality and on cultural continuity. The "good life" is not equated with conspicu- ous consumption, and the individual quest for material gain that spurs entrepreneurship in many countries is not so highly re- garded in Oslo. Nor is competitive ingenuity; factory foremen and executives often view new ideas as threatening. Many firms are family owned, and company strategy sometimes amounts to preserving the status quo until a competitor's success clearly seems to warrant imitation. And "marketing" (which in some
U.S. corporations seems to take precedence over quality control) plays only a minor role in Norway's commerce. Managers cling to the notion that "good products sell themselves."
A Morality Tale
Thus bound by tradition (and weakened by government pa- ternalism), Norwegian businessmen were psychologically ill- equipped to cope with the worldwide recession and technological flux of the mid-1970s. This same psychology now makes it hard for the average Norwegian to accept the conse- quences of failure in the marketplace-the slow death of indus- tries that date back to Norway's independence in 1905. Norwegians worry that the decline of factories and mines in the hinterland could lead to an exodus of the rural folk and of the strong culture that has survived modern times so far. Oslo, Trondheim, and other cities could overflow with people depen- dent on government make-work for their livelihood.
In some respects, of course, this is the specter haunting many Western industrialized nations on the brink of the "information agew-masses of well-paid workers rendered unemployable by the transition from a "manufacturing" to a "services" economy. But in Norway, that transition is lubricated by oil. Traditionalists fear what the Financial Times of London calls the "Venezuelan effect": The petroleum industry becomes "the only provider to a popula- tion left mainly, otherwise, to cut each other's hair."
The Conservative government of Prime Minister Kaare Wil- loch was elected in 198 l partly on the basis of his promises to halt the slide toward a stagnant, government-dependent services econ- omy. The plan was simple. By slashing subsidies, Oslo would ex- pose Norwegian companies to international competition, leaving them to sink or swim. If "sunset" industries died, "sunrise" indus- tries would be born. One way or the other, the dead weight would be eliminated, and the private sector resuscitated.
The Wilson QuarterlyISpring 1984
138
In practice, such rigor has proven difficult to sustain. Nor-
way has hundreds of tiny towns tucked away in the hinterland.
The survival of each may depend on a single factory or mine.
The vision of entire villages left without a local source of em-
ployment has proven politically forbidding-particularly now
that the Conservative Party depends on the rural-based Chris-
tian People's and Center parties as partners in a ruling coalition.
In its early days, for example, the Willoch administration re- fused on grounds of principle to rescue a dying aluminum smelter in Tyssedal, a village in southern Norway with a population of 1,400. But as protest grew, the government could not leave the townsfolk to suffer the agonies of economic Darwinism. Oslo re- cently agreed to help build an ilmenite smelter there instead.
Thus, the long drift toward a state-financed economy is dif- ficult to reverse. No one likes to suffer or inflict pain. By the end of 1982, the "sheltered" sector of the economy-government services plus government-subsidized industries-accounted for 80 percent of Norway's employment. Only seven years earlier, the figure had been 59 percent.
In purely financial terms, Norway can afford such self- indulgence. Total output of oil and natural gas is likely to rise to 60 million "tons of oil equivalent" (TOE) by 1985, and to 75 mil- lion TOE by 1990. With some l l billion TOE beneath its allotted ocean floors, Oslo could maintain the projected 1990 production rate well into the 22nd century before supplies ran low.
But what will Norway look like after decades of such "pros- perity" if its people do not reject the course charted during the 1970s? Will every worker's paycheck come from the government? Will the nation's mines and factories be