Lean times for welfare states

The progressive and affluent welfare states of Scandinavia have managed to combine the best of two worlds: the wealth of the West and the egalitarianism of the East.

But economic hardship is forcing some choices. The answer emerging now is the supply side -- boosting profits, corraling state spending.

* In debt-ridden Sweden and Denmark, the economies aren't supporting today's generous welfare states.

Sweden is beginning to cut some of the world's highest income taxes.

* In oil-rich Norway, it's too easy not to make hard choices. The Norwegians can afford to let industry's cutting edge grow dull.

* Finland, a half-brother to Scandinavia, has never felt rich enough to spend public money in the lavish Swedish style. But the Finns, supply-siders since 1976, may now have the healthiest economy of all.

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