Not Just Another Recession
Why the Global Economy May Never Be the Same
IT IS interesting to speculate upon the reasons for the sustained attention which Norway is giving to her long-neglected northern provinces. Is it due to the international crisis and the dangers of the new common border with Russia? Crisis is not new to the north and the border has often in the past been shared with Russia. Is it an expression of greater Norwegian nationalism? As early as the fourteenth century, Norwegian kings jealously guarded their Lapland-marches and built a fortress to assert their domain. Is it due to economic factors? The northern fisheries and other industries are ancient and have always been linked with the south. Have the opportunities for settlement in Nordland, Troms and Finnmark been the vital factor? For centuries large colonies have migrated from the south in times of famine or misfortune. Can it have stemmed from sympathy in the wake of the German "scorched earth" policy? The Russians have raided and burned along the coasts in times past. Is it the threat of radicalism and disaffection? This threat exists, but has been greater in earlier centuries.
The explanation for the Norwegian Government's postwar concern probably includes all of these reasons, but there is a new and overriding explanation--the budding awareness everywhere of the North, and the world-wide push into the Big Frontier. The push is stimulated by scientific developments which enable men to deal with the problems of the North with new effectiveness, especially the development of rapid means of communication. And, not least, it is stimulated by the new political importance of all the world's northern regions.
During World War II the German occupation of northern Norway was rapacious and cruel. But among its by-products were the construction of airfields (from which the Allied convoys to Russia were bombed) and of continuous highway links in the extreme northeast and in Finland. In 1944 the Germans were driven back by the Soviet Army and burned the province of Finnmark with a senseless thoroughness. Since thousands of people were rendered homeless, the Norwegian Government gave Finnmark the highest priority for reconstruction. Two years ago, when the emergency had been relieved, the North Norway Plan was instituted to encourage the fullest economic development of this region--once treated merely as a colony--and its integration into the economic and political life of Norway.
A symptom of the long era of neglect of North Norway is the surprising fact that until recently it was less explored, in scientific terms, than Norway's Arctic archipelago, Svalbard. And while the latter lured expeditions from many nations, research in North Norway emanated chiefly from the Tromsø Museum. It is a region of almost incredible beauty with sharp diversity among its land forms, populations, economies, languages and customs. The chief unifying feature is its lighting: long days of summer sunlight, "the land of the midnight sun;" then the short days, darkness, and aurora borealis of winter. The contrast is felt throughout the whole region, and challenges civilization to create harmony.
North Norway, which covers 41,840 square miles--about one-third of Norway--begins with the southern boundary of Nordland province, about 90 miles south of the Arctic Circle, and extends through the provinces of Troms and Finnmark to the shores of the Arctic Ocean. Thence it extends eastward to Russia. In ages past Nordland and Troms formed the mighty province of Halogaland, which clung to the western slopes of the "Keel," the mountain range which divides Norway from Sweden. On the western side the land is deeply indented by fjords, and some of the mountains, partly submerged, form chains of rugged islands, such as Lofoten and Vesteraalen. Although these mountains never attain more than 6,000 feet, their jagged contours and bare tops give the impression of enormous height. Except along the coast, travellers going any distance by land inevitably find themselves crossing the tree-line. The tides race in and out of the long fjords and between the islands, and, in doing so, often create a "strøm," or whirlpool, such as the Saltstrøm, the Moskenesstrøm, or Poe's "Maelstrøm."
In recent times several broad river valleys--for example, Målselv--have been opened up to agriculture; and mining or forestry have been developed in particular districts. But for the most part, the patterns of settlement have followed a tradition built about the sea. The economy has been based chiefly upon the great wealth of fish, particularly the cod, and the Nordlendinger have divided their labors between their boats and nets and small farms nestled at the mountainous side of a fjord. But since sufficient grain for bread cannot be grown on these farms, trade has been necessary with southern Norway, or with the Russians in the east. The available land is so limited that the location of settlements has changed little; in many places the modern inhabitant has his farm where before him the Viking had his vin and before him the stone-age hunters had their village. What is surprising is that since proximity to the fishing grounds has been the chief consideration for settlers, remote islands or headlands, with no overland communications, often bear the largest towns. But there is an honored Norwegian saying: "The land divides us; the sea unites us."
The climate of these western districts takes its character from the sea, and is controlled by the North Atlantic Drift of the Gulf Stream which breasts the coasts of all northern Norway and keeps the harbors ice-free throughout the year. The winters are relatively warm with heavy snowfalls, the summers cool. All the Arctic is growing warmer, and the glaciers are in retreat.
East of the "Keel" lies Finnmark, divided into coastal districts whose five immense fjords and their raised beaches give the impression of a land just emerging from the sea, and the inland tundra plateau, or Vidda, the home of the nomadic Lapps. In the far east lies Grense Jakobselv and the Pasvik Valley, since Paleolithic times a central artery to Finland but now a closed border. The population of Finnmark traces its origins to Norwegians, Finns and Lapps (the first two predominant on the coast), and there has been extensive intermixture. The names used to describe Finnmark and its populations are rather confusing. In early days the Lapps, who call themselves Samer, were known as Finns. Thus Finnmark was the "land of the Lapps." Within the province the Lapps are still called "Finns." A man from Finland is a Finlander, but the Finlanders who live permanently in North Norway are called Kvaener, derived from an ancient name for their homeland.
Within historical times the Arctic sea-ice descended to the coasts of Finnmark in winter, and sealing and walrus-hunting balanced spring and summer fishing. On the inner parts of the fjords lived the so-called Sea Lapps, while on the islands and headlands near the best fishing grounds the Norwegians and Kvaener held sway. The sea-ice has long since disappeared, however, and the coastal climate does not greatly differ from that of Nordland and Troms. Inland, the winters can be bitterly cold, the summers hot. On the Vidda the Lapps pastured their herds of reindeer and in summer followed them to the coast. Along the rivers impoverished Reindeer Lapps lived in permanent settlements catching fish, milking a few poor cows, and snaring ptarmigan in winter. This basic economic pattern still continues, but to it has been added a mixture of occupations, including mining; and agriculture has been improved. In general, it might be said that along the coast and in the farming valleys the Norwegian culture predominates; inland the culture of the Reindeer Lapps has the most vitality--though the reindeer-drawn sled is being efficiently challenged by the snowmobile.
Scattered towns and small cities, often established by royal proclamation, have augmented the settlement of northern Norway. Some of these trace their origins to the fiskevaer or fishing stations where a convenient harbor and storage facilities near the fishing grounds were of great seasonal value; and many of these became permanent towns such as Svolvaer, in the Lofotens. Other towns sprang up about the headquarters of a nessekong, literally "king of the point." These men were traders whose harbors and supplies--and credit--were strategically located on coastal routes dominating a certain district. Other towns were formed in different ways: Mo i Rana and Kirkenes are mining centers; Bodø with its harbor, proposed railhead, and airfield is to be a great Arctic communications center; Narvik is the shipping port for Swedish iron ore; Tromsø, the cultural center of North Norway, is a focal point for sealing and whaling, and for traffic along the coast and to Svalbard. On the Vidda the towns of Kautokeino and Karasjok have grown about missions and have become Lapp centers. Throughout the whole of North Norway settlement and economic development are advancing rapidly.
But the energy being devoted to the region is not due to fresh discovery, for northern Norway has been settled for ages. The first known human occupants of Scandinavia were stone-age hunters who crept westward around the fringes of the great ice sheets covering the land and settled upon the coasts of North Norway 8,000 or 10,000 years ago. They established the so-called Komsa culture. As the ice melted and new lands further south were cleared, other tribes moved in from the southeast, and were in turn pushed northward by the invading Finns. Possibly they were the Reindeer Lapps, if these people did not arrive by a separate route from northern Asia. At any rate, when Tacitus sat down to write his description of northern Europe, he had before him incongruous tales of a primitive people living in the far north whom he called Finns. As the years went by and reports from the north increased, writers were able to describe Skridfinnia, in northernmost Norway, and Biarmia, near the Kola peninsula. Both lands were inhabited by Lapps, described by Saxo Grammaticus as "the farthest people to the north, in a clime almost uninhabitable, good archers and hunters, and of uncertain habitations, wheresoever they kill a beast making that their mansion, and they slide upon the snow in broad wooden shoes."
Toward the end of the ninth century a Norwegian Viking, named Ottar, strode into the halls of King Alfred the Great of England and told of a voyage he had made around the top of Norway to the White Sea. Since the English king was literate, he recorded Ottar's remarkably accurate descriptions, and the first clear impressions of North Norway began to emerge from the mists of fable.
Thereupon the Sagas, corroborated by archeology, take up the story. We find northern Norway an important part of the realm. We read of the strongholds at Bjarkø and Andenes and the chieftains whose mighty influence was felt not only in the north but throughout the land. We read of the Halogalanders' skill at building boats, the importance of their fisheries, the revenues from taxing the Lapps, the laws which they framed, and their warfare. We also read of border disputes with the Russians after 1217. Sometimes the disputes were concerned with ownership of the land, at other times with the privilege of tax-collecting. Often, with Sweden joining in, the benighted Lapps found themselves taxed by three nations at once. From St. Olav's time the Norwegians taxed east on the Kola to Valijoki, the coast being known even today as the Murmansk (Northman's) Coast. The Norwegians last collected taxes in Kola in 1613, but the Norwegian claims continued until 1813. Some years the Vikings raided the Russian coasts, in others the Russians plundered and burned as far south as the Vesteraalen, notably in 1302, 1316 and 1323. The present border was more or less foreordained by the construction of the Vardøhus fortress by the Norwegians in 1307, to protect Finnmark, and by the gradual establishment of the Greek Catholic church on Kola.
How could northern Norway--rich in resources, well organized, influential in the affairs of the country and jealously guarded by the king--suddenly have declined at the end of the fourteenth century to a position which brought it neglect and the abuses of colonialism for 400 years? Various explanations have been advanced, ranging from climatic change to the supposition that Norwegian seamen forgot how to sail past the rough seacoast above Sør-Trondelag called Folla.
The real explanation is simple. From the time Norway was unified until 1380, the capitol of the nation and seat of the Church had been Trondhjem, the logical center of the country. As long as the capitol remained in Trondhjem the powerful chieftains of Halogaland were able to exert an influence proportional to their position in the realm. Nordland is still Norway's second most populous province. However, in 1380 Olav V, who was already King of Denmark, moved the capitol south to Oslo, and ruled chiefly from across the Skaggerak. Upon his death in 1387 the old line of Norwegian kings died out and Norway was ruled from Denmark. In those days of slow communications the political influence of the Halogalanders was no longer felt.
Two economic factors contributed to the decline of the north. In the fourteenth century, the Hanseatic League of merchants, particularly those established in Bergen, gained virtual monopoly over trade in Norway, and because of their vital grain supplies were able to control trade with the Halogalanders. The League exploited the northerners; and at the same time the Danish kings, under the pretext of the Russian threat, outlawed all other trade outlets and instituted a system of absentee landlordism. A few bad fishing years in North Norway, or a crop failure, plunged the inhabitants into debt.
The Hanseatic monopoly was not only instrumental in the decline of Norway, but impoverished the whole country, and Greenland as well. Indeed, Greenland suffered the most, for it was furthest away, and the Hanseatic merchants, who were not noted for benevolence, found the trip too arduous in comparison with the more lucrative markets. The Greenlanders were helped by the intermittent trade with English merchants, forbidden by the Danish king. In like manner, North Norway survived by illegally trading fish and furs with the Russians for grain.
Although the Hanseatic League finally lost its grip in 1560, its place was taken by other Bergen merchants. Periodic famines continued, and only bread made from bark prevented much of the population from starving. The Danish crown tightened its hold upon all of Norway and taxed the people remorselessly. North Norway paid heavily for resisting the Lutheran Reformation. Although many of the most distinguished Norwegians came from this region, the majority of northerners were treated with condescension. The result, of course, was disaffection, and in time this might have disrupted the country, had not the Russians provided a counterirritant with frequent plundering and burning. In 1811, Bishop Mathias Krogh of Nordland, in an effort to induce more men to become full-time farmers, remarked that while farmers were secure and loyal, the fishermen--who relied on Bergen--had little patriotism. The continued allegiance of the northerners to Danish sovereignty was becoming doubtful, and Russian and Swedish tax-collectors were already at work in Troms and Finnmark.
At the end of the eighteenth century a program of reform was instituted under which traders were permitted to deal with whom they chose, to settle without permits, and to be free from taxation for 20 years. Outside capital was courted for investment in Finnmark, and widespread land reform was undertaken. The effort paralleled the modern scheme of development just adopted, and for a few years showed promising results until the wars following the French Revolution depressed the markets and brought renewed adversity.
But the lesson of the whole experience was not lost on the northerners. If appeals to humanity and justice had failed to move the Bergen merchants or the Norwegian Government, the threat of shifting allegiance had brought action. Norway regained her independence in 1905; but eastward in Russia political radicalism was growing swiftly, and northern Norway watched with interest and sympathy. Presently the extreme left came to power in the Tsar's realm. The upshot was great prestige for Communism in North Norway--and, today, a stronger Communist Party there than elsewhere in Norway. One meets prosperous fishermen in Finnmark, owners of their own boats and in every sense capitalists, who consider themselves staunch Communists, remembering the days when their season's catches were purchased at a fraction of their value, and reasoning that Communism is an effective method of drawing attention to the needs of the north. Indeed, they point to the new North Norway Plan to prove their argument.
The genesis of the North Norway Plan, however, lay in a humane response to the need of postwar reconstruction. The German campaigns in the north, followed by the scorched-earth treatment of Finnmark, focussed the attention of the nation on the plight of the region. During the war the north had been the center of military activity. Most people in Finnmark lost their homes and livelihood, and privations were also severe in Troms and Nordland. When the war ended many thought that essential food and clothing, even machinery, might be had from abandoned German depots. But the liberating English destroyed most of these supplies and, in doing so, incurred considerable bad feeling. After the Finnmark relief commission had provided the essentials of life--food, clothes and housing--the Norwegian Labor Government sought to rebuild the economy of the region. There was some conflict between Socialist theory and ingrained tradition--with tradition winning. Regional planners, for example, wished to rebuild destroyed fishing villages further up the fjords, where the prospects for agriculture were better and fishing could be supplemented by farming. The former villages had been placed on headlands near the fishing banks for the convenience of oarsmen and sailors, but modern motor vessels could take fishermen to the banks further away in no more time; but the people insisted that the towns be rebuilt on their former sites. Regional planning was successfully applied in some areas, however, and new farm lands were opened to take advantage of soil fertility, and availability of timber and transport. The iron mine at Kirkenes was rebuilt, among other industries. A boom spirit prevailed and there was large-scale immigration from the south.
At the same time, the Norwegian Government was faced with many new problems. For example, timber from north Finland and Finnmark used to be floated to the sea on the waters of the Pasvik River. But the peace treaty between Russia and Finland lopped off the north of Finland, and the Russians will not permit the floating of logs; the logging industry has consequently come to a halt in that region. Moreover, the Russians have taken to releasing the pent-up waters of Lake Inari at irregular intervals and flooding the farmlands on the Norwegian side of the Pasvik. Another example of new problems is the curious transformation in progress among the Reindeer Lapps. Success with a reindeer herd depends upon nomadism--in other words, the constant search for good pasture. But now Lapp women have learned of one of the amenities enjoyed by their sex in less rugged climates --in a word, houses. They demand a house. If the husband is to provide one, he usually has to sell a large part of his herd to pay for it; and moreover, if the family lives in it, he is no longer a nomad, and instead of being an effective herder of reindeer, he finds that he is a poor farmer. Of the 20,000 or so Norwegian Lapps (two-thirds of the world's total), only 2,000 are still reindeer herders. It is estimated that a family of five needs a minimum of 200 reindeer to earn a living, and at present about 60 percent of the Lapp families have herds that cannot support this mode of life. Sealing and whaling, which have long constituted one of the chief enterprises for the people of the north, likewise offer new frustrations. The hunting grounds extend from the Arctic to the Antarctic, but the sealing in the White Sea and in the waters about Franz Josef Land have been of major importance. Now the Russians have barred the Norwegians from these areas, despite earlier agreements.
When the relief commission terminated its work in 1951, social conditions were unsatisfactory. The influx of workers had created unusual housing shortages and seasonal unemployment. The old-style Communists were entrenched in a number of districts, and to them were added numbers of malcontents. The nearness of the Russian border and rash statements about abandoning the north above a certain line led many non-Communists to adopt an attitude of fatalism. There was widespread skepticism about the effectiveness of NATO. Recognizing that the situation in the North was too precarious to be ignored, the Norwegian Government in 1951 proposed a ten-year plan for development. It drew strong support from all segments of Norwegian life. The unique feature of the plan is that, though the government is Socialist, it sought to achieve its objective by encouraging private enterprise and guaranteeing loans. The plan is ambitious and provides for the expanded use of natural resources through mining, fishing and agriculture, improvement of communications, building of hydroelectric plants for industry, clearing new lands for farms, reforestation, improving methods of fishing and preparing fish for the market, reorganizing banking and credit facilities, and (as in the eighteenth century) offering tax relief to investors.
The North Norway Plan went into operation in March 1952, signalized by a lavish and successful national trade fair held in Tromsø during July of that year. It was attended by the King and members of the Storting, and gave many northerners their first glimpse of the possibilities of the future. So far the progress shown is encouraging, though only a small part of the initial appropriation of 225,000,000 Kroner has been spent. Surveys of resources have been made, with a view to laying the bases for new industry, and educational programs outlined in the various crafts and trades. The Sør-Varanger iron mines have been brought back into production, with Marshall Aid, and exported 205,000 tons of ore in the first four months of this year. New housing units are being constructed, money has been allocated for the purchase of reindeer for the Lapps, for fencing, and for slaughtering and freezing plants. Many new plants for processing fish are being built. In Bodø a huge airfield is nearing completion. In the cultural field plans are being made to expand the fine Tromsø Museum, with the hope that it may some day become a university for North Norway--a source of great satisfaction to the northerners.
All is not smooth sailing, however. During the spring, severe storms ruined the Lofoten fisheries, making the catch the poorest in 50 years and severely diminishing one of Norway's important sources of revenue. It was necessary to appropriate large relief funds for the destitute fishermen, and many processing plants were forced to close. But, as compensation, the Finnmark fisheries have been highly successful. And as a reward for the regional planners in their battle with tradition, 81 families from the outer fishing stations have now asked to be resettled elsewhere.
In reviewing the progress of its North Norway Plan the government found reason for encouragement, but also made some sobering discoveries. Reidar Carlsen, Director of the North Norway Development Fund, recently stated: "We must be prepared for disappointments and miscalculations. That cannot be avoided. But we shall learn from our mistakes and do a better job in drafting plans for the larger projects which will have to await completion of defense installations in the northern provinces." The major problem is that the funds for development are limited; indeed, much of the money is supposed to come from the surpluses of the National Unemployment Insurance Fund. If Norway should meet with a slump in foreign trade, the program might be halted as abruptly as was its forerunner in the Napoleonic era. To give stability to the program foreign investment is needed. Yet the Labor Government places so many obstacles in the way that this is unlikely on any significant scale.
The fears entertained by private business in Norway were intensified this spring when the Storting passed a price-regulation law whose innocuous name belies its power. Presumably, the government can now determine the prices of all goods, choose the markets, decide the type and extent of production, in short, regulate industry in detail. Rationalization, not competition, is apparently to be the yardstick of business. This law presents an odd contrast to the avowed purpose of the North Norway Plan of encouraging private enterprise, and if the two can be harmonized they will offer a strange economic paradox.
One other urgent problem of a different kind is linked with these efforts to help North Norway achieve a balanced economy. North Norway's common border with Russia presents a military threat found only in one other part of the NATO community, Turkey. The frontier, once the area of friendly commerce with the Finns, is now closed; and the Russians reputedly have established advanced military installations on the other side. Accidental border crossings by Norwegians lead to detention by Russian border patrols; and the Russians take every opportunity to protest against defense preparations on the Western side.
The attitude toward this border has undergone considerable change in North Norway in recent years. Immediately after the war the Russians were considered as "liberators," and were popular in Finnmark. Communism made many converts. Today, as the north becomes more closely knit with the south, many northerners have left the Party. But a third of all conscientious objectors in Norway come from the north, there are many Communist soldiers in the home guard, and the idea that this territory is fated to be taken over by the U.S.S.R. persists.
In an effort to correct this fatalism the Norwegian Government has been sending teams of political speakers north to explain the purpose of NATO, and is also constructing defense installations to make plain that the northerners are not to be abandoned. More than a quarter of the national budget this year is destined for defense projects--37,400,000 kroner of it for a military airfield on Andøy in Troms. Throughout the region male citizens have their assigned defense tasks, and determination grows with the confidence that successful defense is possible.
North Norway is one of the most important areas within the NATO community, yet the most vulnerable--a flank that might be easily turned by large, modern forces unless real strength is developed there. Its loss would mean the loss of Norway. Yet its usefulness is also great. In terms of over-all Arctic strategy, its rôle is that of guardian of the sea lanes to and from northern Russia--a task to which its great fjords are suited and have been used before. Its air bases are situated on the Arctic perimeter, and are within effective striking range of the Soviet Union. If present plans mature, the defenses of the region will add formidably to Western strength. Norway has every reason to speed the rebirth of her long-neglected northern lands, and Norway's friends have every reason for seeking to forward the effort.