The Neoliberalization of the Norwegian Welfare StatePublic Investments in a Privatized Global Economy

This paper explores the Norwegian stateʼs integration into the global web of neoliberal economic relations, a largely neglected dimension of contemporary Norwegian history. It argues that since the 1980s, restrictions in the domestic market have generated problems of overaccumulation within key state-controlled sectors of the Norwegian economy, and that the state has met these crisis tendencies by developing what Harvey calls ‘spatial fixesʼ. On the one hand, the state has set in motion a comprehensive process of internationalization of state-owned enterprises that have exhausted the limits to expansion within the domestic market. On the other hand, it has built up the worldʼs largest sovereign wealth fund by channeling surplus petroleum profits into rent extraction in global financial markets. These spatial fixes provide the backbone of what the paper calls the neoliberalization of the Norwegian welfare state: By turning public companies and investment funds into internationally oriented profit-maximizing entities, the state has externalized a significant share of its productive and extractive activities beyond territorial boundaries and thus become thoroughly integrated into the neoliberal world economy – all the while maintaining a relatively strong system of public ownership and social redistribution within its national borders. Seen from a global vantage point, the relative persistence of social democratic institutions within territorial borders has become increasingly dependent on – and thus combined with – more aggressive processes of neoliberalization elsewhere.