I've heard this argument and I am absolutely no expert but I have read in a number of articles similar conclusions to this:
^One underlying problem with socialism is that confiscating wealth and redistributing it takes away the incentive to work hard, to innovate, to invest, to take risks, and to be competitive. In other words, eventually you run out of other people's money.
And Norway is a very inappropriate model for comparison with the UK. A vast proportion of their economy derives from natural resources - oil, fish, hydroelectricty etc. In such an economy, the above drawback of socialism is largely avoided. Indeed, it is a fairer way of dividing the econoic spoils, given that they are "gifts" of nature, more than the fruits of labour, innovation, investment, etc.
What is interesting to note, is the extent to which other Scandinavian countries - particularly Sweden, have thrived since the 1960s, as they have shifted from the very socialist policies for which they are famous, towards a freer, market-drive economy. They stll have an emphasis on redistribution, but they have largely recognised that markets do a better job of allocating production resources than government planners do.^