OSLO -- By any measure, Kristoper Holfeldt should be one of the happiest people in the world. As a delivery-truck driver in Oslo, he earns almost $70,000 a year in one of the world's most equal society. His daughter takes advantage of free university tuition, his free public medical and pension benefits are stellar, and he lives in the healthiest and best-paid society on Earth.
On top of that, Norwegians keep getting richer. Their oil fields in the North Sea and the Arctic have turned this into the Saudi Arabia of the north. Oil and gas sales pay Norway's government $1-billion (U.S.) a week; this country of fewer than five million people now has a savings account that next year will hit $300-billion. And Norway has tapped only a quarter of the oil and a 10th of the gas that are estimated to be trapped beneath the Barents Sea.
But Mr. Holfeldt, like an amazing number of Norwegians, says he is anxious and unhappy — and he blames the oil money.
“We may be a lot richer, but this is not the happy place it used to be,” he said as he unloaded boxes of meat patties at a pub that will turn them into $16 hamburgers to be consumed with $10 beers. This is the most expensive capital city in the world, but even measured by purchasing power, Norwegians are the world's wealthiest consumers — although this seems to give them little joy.
“Before, we were just poor fishermen but we all co-operated. Now all we seem to do is fight about the money.”
To walk the chilly streets of Oslo, you would not think you were in a city whose oil wealth is comparable to Dubai or Riyadh. It is a sleek, orderly place with a certain sense of elegance. But there are none of the super-modern government skyscrapers or displays of state largesse that mark the capitals of Kazakhstan, Venezuela or Saudi Arabia. Norway's left-wing coalition government, backed by many of the conservative parties, is almost unique in the world for having the self-discipline to avoid using the money to bolster the ruling regime's popularity.
But this discipline is creating deep fractures in society. In a country whose citizens were among the poorest in the Western world as recently as 40 years ago, where politics has always been a matter of polite consensus between parties, the battle over money has done deep damage. Some people here call it “petroleum poisoning.”
The divisions came to the surface this month, when the government introduced its budget proposal. Even though the country's economy is booming, with a 2.5-per-cent unemployment rate and vast oil revenues, Finance Minister Kristin Halvorsen chose to raise taxes across the board — not just income tax, but also the already high taxes on food, on housing and on fuel.
In a move that seems masochistic to many Norwegians, her government has vowed to spend only 4 per cent of the oil revenues a year on average, and to invest none of the huge savings account in the Norwegian economy.
“If you didn't have any fiscal discipline, we wouldn't need to increase taxes, we could just pour the petroleum money into the economy and solve every problem by just spending oil money,” Geir Axelsen, Ms. Halvorsen's Secretary of State for Finance, said in an interview at the ministry's austere offices.
“But when we have this natural resource, it's a moral question: Is it right for our generation to just spend this wealth, this fortune, in our time? It's taken 100 million years to create these resources, and it's possible that they will be used up in the next 50. Isn't it reasonable that the next generation also has the option to choose how to spend the money?”
Ms. Halvorsen will do some characteristically Norwegian things with that money: Foreign aid spending, already the highest in the world, will be raised to almost 1 per cent of the country's economy. Foreign debts to almost all countries will be forgiven. And more money will be spent on welfare, to help the country's poorest residents.
To many members of the Norwegian working class, this is bewildering. The high prices here do create a psychological effect of vulnerability, and credit-card debt is high. There are waiting lists in public hospitals, roads that need repairing, and other inconveniences that could be solved with the oil money, which amounts in total to almost $60,000 for each man, woman and child.
This has created an opening for the ultraconservative Progress Party, traditionally an anti-immigrant voice that has lingered on the fringes of Norwegian politics, ignored by the news media and excluded from governments by the mainstream conservative parties.
Its new, charismatic female leader, Siv Jensen, has transformed her party into one that has galvanized many Norwegians around the question of oil money.
This week, the party reached more than 30 per cent in the polls, making it the most popular party in Norway, capable of forming a government on its own (although elections won't be held for three years).
This has shocked many Scandinavians, for the Progress Party was, until only months ago, considered by many to be a racist force on the fringes of society. During elections last year, the party preyed on fear of non-white immigrants (one of its website slogans was “Dangerous Africans walk the streets”), the concern about oil money has thrust it into the mainstream.
In person, Ms. Jensen comes across as an elegantly tailored businesswoman — she made her living in the footwear business before entering politics. In an interview at her parliamentary office, she spoke angrily of the crimes committed by immigrants (although Norway's immigration rates are very low), using rhetoric that brings to mind France's Jean-Marie Le Pen or Austria's Joerg Haider — her party calls for a complete end to immigration and the deportation of some residents.
But then she turned to the subject that, along with her own charisma, has given her party its new mainstream popularity.
“I think the oil money has a great impact on people's attitudes,” she said. “People can't understand why we can't build roads in this country. You see every other country in the world building roads; we can't do it, they say, we don't have enough money. And at the same time we have so much money that people can't believe their own eyes.”
Her party would like to take an approach similar to Alberta, which has spent 92 per cent of its oil money, partly on tax cuts but also on infrastructure. Rather than stock-market investments, Ms. Jensen said, Oslo should put its money into improving its roads and business environment. Norway's roads are not in terrible shape, but it is a country whose few people are spread sparsely over a huge area, so its towns often aren't as modern as those in France or Germany, a subject of endless complaint from residents.
Economists say it would be disastrous if Norway spent much more than 4 per cent of its oil money within its own economy. With full employment and an expensive currency, all that money would certainly cause a spiral of inflation, currency overvaluation, declining exports and unemployment. But for the working-class people who are flocking to the Progress Party, these are the nitpickings of the elite.
Ms. Jensen, like the leaders of Kazakhstan and Venezuela and Russia, has discovered that oil money can be a powerful political tool. Like many Norwegians, she describes an insular, formerly isolated country that has been thrust too quickly, and perhaps too successfully, into the globalized economy. The spectre of non-European immigration, and the tough decisions over whether to spend or save vast fortunes, have led to unease and a sense of political revolt — and for the moment, at least, she has the country's ear.
“The public, they are very disappointed right now,” she said. “But these things can change.”
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