Ethics and Economic Development in Norway

President Iglesias, ladies and gentlemen,

It is a great pleasure to be invited to address this seminar, which explores the relationship between ethics and economic development. The Inter-American Development Bank’s Initiative on Social Capital, Ethics and Development was started here in Oslo in 1998, and I have followed the successful progress of this initiative with keen interest ever since. Among other things, I had the pleasure of attending the important conference under the auspices of the initiative in Belo Horizonte, Brazil, in July last year. And I can assure my friend President Iglesias that my government will continue to support the IDB and this important initiative. We believe that it can make a difference, and that it will promote growth and development in Latin America.

I also want to thank the enthusiastic co-ordinator of the initiative, Mr Bernardo Kliksberg, and his team for their hard and successful work in fostering dialogue between a whole variety of actors.

Development ethics cuts across academic disciplines, social sectors and sovereign states. We all have a stake in a future where the global community will be regulated by the principles of fairness and justice.

Development is about ensuring a good life for all. And although no one can impose their own concept of the good life on others, all of us have fundamental values that guide our actions, individually and in society, in our private and in our public lives. As a theologian and minister of the Norwegian Lutheran Church, I am convinced that personal values and political goals and choices are intrinsically related. Respect for life and human dignity, safeguarding the environment, compassion and solidarity are all fundamental values and they are of particular importance to me.

These values should guide our efforts to promote justice, human rights and social and economic development, both nationally and internationally.

The construction of Norway’s welfare society was a gradual and a continuous balancing act between stimulating economic development and promoting social justice. Norway has achieved its welfare society through a combined effort by the state, business and market institutions, trade unions and civil society.

In some ways, we had a favourable starting point. The lack of feudal social relations, the relatively egalitarian society, and the homogenous population of pre-industrial Norway all facilitated consensus-building across social sectors and their often-competing interests.

We have also benefited from the foresight of our “founding fathers”. These were the men – for this was before women’s liberation – who drafted our Constitution in 1814, inspired by the revolutionary wind that was sweeping across Europe. For its time, it was a remarkable achievement in a far outpost of Europe. Today, it is one of the two oldest constitutions still in force in any sovereign nation, second only to that of the United States of America.

No country can replicate these characteristics. But some lessons and strategies may be useful.

Transparency, open government and the institutionalisation of all human rights is a basis for building prosperity. Corruption, dishonesty and lack of an independent judiciary create a climate of risk and uncertainty for investors. Nepotism and elitism make education and training a bad investment for the individual when jobs are not awarded on the basis of merit and qualifications. This is a vicious circle. Under-investment and under-education then result in low productivity, low income, low tax revenues and a poor economic basis for developing viable civil institutions.

In the words of the famous American Frederick Douglass, a man who became famous for his struggle to abolish slavery: “Where justice is denied, where poverty is enforced, where ignorance prevails, where any one class is made to feel that society is an organized conspiracy to oppress, rob and degrade them, neither property nor persons will be safe”.

Some people say that the welfare society cannot survive the increasing pressures of global competition. I disagree.

The Nordic countries have generally been characterised by low unemployment and high labour force participation. One of the reasons for this is in my opinion that we have invested heavily in education, and provided free access to universities and colleges for qualified students from all sectors of society, irrespective of economic background. Maternity leave and subsidised child care facilities make education a worthwhile investment also for women, which in turn contributes to very high labour force participation. This in turn supports the economic basis for the welfare system.

Interestingly, the age of the Internet may give an additional advantage to having a fair distribution of income. For in a society where Internet access is available to all, the gains from increased competition, increased productivity and economies of scale are far greater than in those countries where inequality makes computers a toy for the few. The Internet has transformed not only the way we do business, but also the scope, quality and availability of government services.

Thus, crossing the electronic divide, making the Internet available to all, must be one of our highest development priorities. For it is not just a tool for the exchange of goods, it is also becoming a main medium for the exchange of ideas. The oppression of a people always starts and ends with the oppression of ideas. Freedom of information and expression must surely be the best anchor to prevent a society from drifting towards such oppression.

Norway is a rich country, but nevertheless we face many domestic challenges. Some of these challenges are directly connected to our wealth. We have created a society of material abundance that poses the social and moral challenges of excessive materialism. And we have created a society where the state provides a social and economic safety net for all, but that poses the challenge of remembering that the collective security we share is dependent on the individual efforts and contributions we make as fellow citizens, workers and taxpayers. As the late Norwegian Prime Minister Jan P. Syse said: “Someone has to create the wealth that so many want to use.” And even in a rich country like ours, people’s expectations are always one step ahead of us, creating endless possibilities for anger, pessimism, conflict and criticism.

But our biggest challenges are not domestic. Organised crime, corruption and tax fraud are problems a state cannot solve on its own. International co-operation is necessary. Although there are some international instruments in place in this field, their objectives are limited. We need a truly international customs and police co-operation. On the other hand, legal instruments alone cannot solve these problems. Basically, they are the result of moral choices. Thus, we not only need better legislation, better international instruments and closer co-operation. We need higher ethical standards.

I want to repeat today that our commitment is to development assistance, to fair trade, to debt relief, to greater investment in poorer regions, and to corporate social responsibility. But we need to do more.

In our privileged position it is a moral duty to help make the benefits of good governance available to all countries, to all peoples. In the famous words of Abraham Lincoln, we need “government of the people, by the people, for the people”. Solving Latin America’s challenges is primarily the responsibility of its people and of its leaders, but its neighbours and the rest of the world also have a responsibility to contribute.

My commitment to the Initiative on Social Capital, Ethics and Development is for me one concrete way of shouldering that global responsibility.

You are a distinguished group of researchers from many different disciplines, including theology and philosophy as well as economics, anthropology and political science. Many of you are policy-makers from national and international institutions.

This promises well. We need more exchange of ideas and experiences between researchers and policy-makers. Studying the ethical basis of development, and the relationship between ethics and economic development must be an interdisciplinary endeavour.

Ladies and gentlemen, I wish you a fruitful and interesting day.