Re:Thriving Norway provides an Economics Lesson
by vidarh on Thursday May 14, 2009 @10:36AM
(#608795)
"The dream" will end only if the oil runs out before the oil fund is large enough to offset the tax gap.
As it is, most oil revenue is set aside, and there wouldn't be a massive budget deficit if the oil revenue went away tomorrow. Doesn't mean there wouldn't need to be some adjustment if the oil revenue dried up, since it provides a lot of employment and the cost of dealing with increased unemployment could be significant, but Norway is surprisingly independent of the oil revenue, and becoming increasingly independent of it as the oil fund swells.
As it is, most oil revenue is set aside, and there wouldn't be a massive budget deficit if the oil revenue went away tomorrow. Doesn't mean there wouldn't need to be some adjustment if the oil revenue dried up, since it provides a lot of employment and the cost of dealing with increased unemployment could be significant, but Norway is surprisingly independent of the oil revenue, and becoming increasingly independent of it as the oil fund swells.