Jim Clark: How’s that ‘market economy’ in Denmark shaping up? (opinion)
Bernie Sanders is giving the Clinton machine fits attracting millennial voters by promising a democratic socialist state modeled after Denmark.
He promises a government-run utopia with income equality, free college, free health care, free child care, generous pensions, free medical care and paid parental leave from work. But is he selling snake oil?
Danish Prime Minister Lars Rasmussen, addressing Harvard’s Kennedy School of Government, stated: “I would like to make one thing clear. Denmark is far from a socialist planned economy. Denmark is a market economy.”
CNN reported that while a lot of services are provided, they’re not “free” because the taxes imposed to pay for them are brutal. There is a 25% value added tax on all goods and services and a confiscatory income tax with a top marginal rate near 60% (in the U.S. it’s 39%).
And while Denmark’s average hourly wage is a generous $18, this is due to some hard bargaining by trade unions … there is no legal minimum wage. Denmark is also very business-friendly. The corporate tax rate is much lower than in the U.S. and free international trade is the underpinning of the Danish economy.
If Sanders is elected will the U.S. look like Denmark? Not likely. Denmark has a population of just over 5 million, 95% of whom are of Danish ancestry. Denmark hangs up a “not welcome” sign when it comes to immigration and that preserves the financial integrity of their high tax, high benefit economy.
The center-right Danish People’s Party recently enacted a law that grants the state the right to seize possessions worth more than $1,500 from refugees who seek aid from the government and increases the number of years refugees have to wait before bringing family members into the country.
Imposing such a system on the U.S. with its diverse population of 300 million would exhaust the national treasury as well as force us to deport all illegals and build walls on both borders. “Democratic socialism” might work in a state with the demographics of Utah, but not the whole country.
Less publicized are some of the things that are “rotten in Denmark.” The CNN study disclosed racial stereotypes in the Danish media that would be unthinkable in the U.S. And although Danes are very gender-equal, the country has the world’s highest rate of violence against women.
And “free” education and health care appear to have some down sides. Denmark is low on the Programme for International Student Assessment (PISA) educational rankings and the wait times to see a doctor are as bad as other socialized societies.
It appears that when competitive services are made into government monopolies, they lose their fine edge. Another dirty little secret is that taxes do not pay for all the freebies; the difference is financed by North Sea oil revenues that are now dwindling.
Three years ago the New York Times published a story about a liberal Danish politician who, to goad her conservative counterpart, engaged in a stunt intended to prove that hardship and poverty still exist in utopian Denmark.
They identified an unemployed single mother of two whom they identified by the pseudonym “Carina,” and paid the 36-year-old a visit. “Carina” was getting about $2,700 in cash per month, plus generous Danish benefits and had been on welfare since she had been 16. The publicity caused a sensation in Denmark, and ever since, Parliament has been taking steps to end welfare fraud and curtail benefits.
Interestingly, in 1996 a Republican Congress passed and Bill Clinton signed the Work Opportunity Act which, in Clinton’s words, will “end welfare as we have come to know it.”
Maybe the Danes should have asked us before they gave away the store.
Jim Clark is president of Republican Advocates. He has served on the Washoe County and Nevada GOP Central Committees. He can be reached at firstname.lastname@example.org.