[Culturechat] Denmark: A Case Study in Social Democracy (From Mises Inst...

[Hal Taussig]

Thanks, J, for mentioning the fact that despite our politics, I and my 
colleagues do a first class job servicing customers. That's what economics 
is about in the final analysis. The Scandinavian "welfare states" are good 
capitalists in that they produce goods and services efficiently-- an 
impressive growing economy for  fifty years.You and I probably define 
capitalism differently. But our differences probably do not constitute an 
enlightening debate for culturechat. On the other hand, I do like your idea 
of discussing Danish wind power. There are quite a few areas like this, 
usually thought of as environmental issues, where we could emulate 
Scandinavian . Another example, there is a fairly substantial use of 
compost toilets in Sweden--in upper class areas of the suburbs. Because 
sewerage is a big factor corrupting drinking water in developing countries, 
I expect to be involved in an attempt to capitalize small entrepreneurs who 
will make and sell compost toilets. This is a way to make capitalists out 
of many people--and eventually give hundreds of thousands a chance to drink 
clean water. (The toilets we plan to use have been designed and perfected 
in Sweden.) Both your topic and mine may be too esoteric to involve a big 
discussion; but it might provoke a general interest in Scandinavian 
culture. And maybe it will lap over into the practical travel issues, 
possibly prompting us to move the possibility of starting a Danish 
(Scandinavian) Untour from the back to the front burner.
Hal
At 11:09 AM 7/26/03 -0400, WesTexas@aol.com wrote:
>Mr. Hansen, a Danish professor, referenced a serious proposal by three
>economists from the Danish Economic Council that the Danish government 
>restrict
>emigration of young people (young taxpayers).  I have posted the relevant 
>portion
>of the article below.   Obviously, Denmark is not East Germany; however, the
>Danes themselves are talking about proceeding down a path that would 
>ultimately
>result in the Danish version of a Berlin Wall--which is exactly how Professor
>Hansen described it.
>
>In regard to the quality of life issue, I have absolutely no doubt that a
>majority of Danes are satisfied with their welfare state.  However, a 
>majority of
>Danes either work for the government, or receive government benefits.   An
>interesting poll would be one that asked the minority (those paying the 
>bills)
>if they were satisfied with the welfare state versus one that asked the
>majority (those being supported by the minority) if they were satisfied 
>with the
>welfare state.
>
>In general, the European welfare states are facing two major problems:  (1)
>demographics (too many retired people and too few young taxpayers, with the
>situation getting worse with time) and (2)  their labor costs are too high 
>(also
>with the situation getting worse with time).   In the U.S., we of course are
>facing the same problems, but not to the same degree as Europe.
>
>In Germany for example, the payroll tax (for social benefits, paid by both
>employer and employee) has gone from about 20% in the early Sixties to 
>about 42%
>today.   Companies simply can't pay these labor costs and be competitive, so
>they are leaving, or at least not expanding.  Young people can't find 
>jobs, so
>they are also tempted to leave (thus, the suggestion that Denmark restrict
>emigration).   This results in a downward spiral of fewer and fewer taxpayers
>and more and more people receiving government benefits (again, the "solution"
>occurs to some to restrict emigration).
>
>Hal actually provided a real life example of this situation.  One of the
>primary reasons he gave for being hesitant about expanding to Denmark was 
>because
>of the high costs.  If Hal does elect to do an Untours to Copenhagen, I think
>that it would be a good idea to set up some type of panel discussion for the
>Untourists, where the parties could discuss the pros and cons of the welfare
>state.  I also think that it would be a good idea to study the progress that
>Denmark has made in starting to convert to wind power--perhaps the Danes 
>could
>make the good citizens of Cape Cod see the advantages of wind power.
>
>(By the way, I don't think that Hal and I agree on much politically, but I
>think that Hal, and his staff, run a first class organization and provide a
>valuable service).
>
>In closing, if things are so wonderful in Denmark, why do serious people even
>find it necessary to discuss restricting emigration?  Perhaps there is
>something rotten in Denmark after all (sorry, I couldn't resist).
>
>J. Brown
>
>Excerpt from Hansen article:
>
><<One option for young people is to leave. It was recently proposed by one of
>
>the three economists from the Danish Economic Council that if young people
>
>in Denmark wish to move abroad after they have completed their education,
>
>they should first have to pay back the costs of their education. Only when
>
>they have paid enough taxes to cover all the expenses of their education,
>
>would they be able to move abroad without having to pay the government
>
>first.  Thus do we have proposed the social-democratic version of the Berlin
>Wall,
>
>an economic barrier to prevent emigration so that the state can continue to
>
>tax people to sustain a system that is unraveling. The mere suggestion is a
>
>telling sign that Denmark has nearly reached the end of the road.>>
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