8 facts to show why Denmark shouldn’t be emulated

For years, those on the left have advocated for a system similar to the likes of Denmark and Sweden. The model primarily consists of this: high tax rates, an ultra-generous welfare state, “free” stuff and less of an emphasis on work. This is pretty much the platform that 2016 presidential candidate Bernie Sanders is putting forward.

Judging by what Sanders and his followers are saying, Denmark is a paradise where everyone is given roses, ponies and a pot of money. They said the same thing about Venezuela and look at what’s going on over there (SEE: ‘Socialist Paradise’ Venezuela running out of money, begins to sell gold reserves). Is Denmark this socialist paradise many claim it to be?

We’ve already taken a look at the degradation of Sweden (SEE: What the heck is happening in Sweden? Negative rates, cash bans, housing bubble and enormous debt) so let’s now take a peek inside the beautiful country of Denmark. Indeed, it is a country with a rich history and wonderful people, but its policies aren’t something to be desired. Even the country’s leadership is looking to reform many of its programs, particularly its entitlement system. Why? Because it can’t afford it anymore.

Here are eight reasons why Denmark shouldn’t be emulated in the United States:

1. “Free” Education Isn’t Really Free

Yes, Sanders wants to offer free college education because they do it in Scandinavia. But is college really “free” in Denmark? Far from it! Just look at some of these tax rates: Danes can pay upwards of 56 percent in income tax on top of a 25 percent sales in addition to a 180 percent tax on car purchases. If this is what it takes to fund “free” education then one must ask: is it really free after all? Nope.

Meanwhile, the quality of Danish schools fail in comparison to universities in the U.S. Since students have to pay for their own schooling through the means of guarantee student loans (this is another topic entirely), post-secondary institutions can cover their costs. However, Danish colleges and universities are under immense financial pressure, which then affects the quality of the education.

2. The Welfare State is Unsustainable

The Danes receive a cradle-to-grave safety throughout their entire lives. The New York Times profiled one woman, 36, who receives $2,700 per month in welfare payments. In fact, she has been on welfare since the age of 16. Now let’s increase that number to the tens of thousands. There are no incentives to work if there’s an enormous disincentive through the means of welfare.

Parents, even rich ones, receive quarterly welfare checks, “free” maid service and “free” healthcare. This is superb in theory, but in practice it’s a devastating one for the country. The Danish government is looking to reform the entitlement system and encourage both young and old to get off the public teet.

Just take a look at this quote:

“In the past, people never asked for help unless they needed it. My grandmother was offered a pension and she was offended. She did not need it,” said Karen Haekkerup, the minister of social affairs and integration. “But now people do not have that mentality. They think of these benefits as their rights. The rights have just expanded and expanded. And it has brought us a good quality of life. But now we need to go back to the rights and the duties. We all have to contribute.” 

3. Are People Working in Denmark?

Indeed, Danes are working, but is it enough to maintain the current system of welfare? You decide by taking a gander at these figures: 2.6 million people between 15 and 64 were working in 2012, which is 47 percent of the total population and 73 percent of the 15- to 64-year-olds. You can’t afford free maid service if this is the case.

Even everyone’s favorite Keynesian economist Paul Krugman has written in his textbooks that welfare benefits disincentive working, though he does contradict himself in his latest New York Times op-ed.

4. When Danes Work They Don’t Work

Danish workers clock in fewer hours and given mandatory perks, such as long vacations, lengthy paid maternity leaves and rank very low in terms of hours worked per year. In addition, Denmark maintains a minimum wage approaching $20 per hour. Again, this kind of stuff disincentivizes productivity.

5. Why Leave College?

If you’re a student in Denmark then you should be ecstatic. In addition to receiving a “free” five-year degree, students are entitled to six years worth of stipends that equate to approximately $1,000 per month. The unintended consequence to this policy is that students take longer to finish their degree because they take vacations and apply for internships prior to and throughout their university tenure. Essentially, taxpayers are subsidizing students’ vacations abroad and internships.

6. Danish Households Deeply Indebted

Since the cost of living is extraordinarily high and Danes aren’t the hardest working people around, households have had to resort to debt. According to the International Monetary Fund (IMF), Danish household debt is around 300 percent of disposable income. This isn’t a new phenomenon either since Danes have maintained triple-digit debt levels since the 1970s.

“Yes, many economists have specifically warned of the Danes’ private debt levels. Perhaps more seriously, productivity has been somewhat stagnant and there is a dire skills shortage,” said Michael Booth, a British journalist and author of “The Almost Nearly Perfect People: Behind the Myth of the Scandinavian Utopia,” in an interview with the Washington Post.

7. A State Church

Many Americans hate the ideas of religion and church. We can safely assume that a majority of Sanders followers aren’t of the Christian, Catholic or Jewish faith. Let’s allow Forbes to describe the state church in Denmark:

“Americans cherish the separation of church and state for good reason. While Danes have religious freedom, 78 percent are members of the Church of Denmark, and this institution is responsible for registering all people in the country at birth, regardless of religion. The exception is the province of Southern Jutland, where the municipality maintains the register. There is an image of a Crucifix on page 2 of the Danish passport. By default, all people pay taxes to the Church. They can opt out, but then they face limited options for burial. Such religious, historical, cultural factors play a role in shaping society, and social policies cannot be understood, let alone replicated, without proper attention to this context.”

8. Income Inequality is Still Real in Denmark

Just because there is a massive welfare state, high tax rates and a swelling government, it doesn’t mean there isn’t income inequality. In fact, studies show that a growing number of Danes feel there is rising income inequality and increasing poverty in the country. This just proves the point that no matter how much welfare you have there will always be poverty and homelessness.

Final Thoughts

Whenever a liberal claims to have discovered a “socialist paradise,” you usually have to look at the facts and data points. Akin to Venezuela and North Korea, the Scandinavian model is far from perfect. It’s something that shouldn’t be replicated. In fact, the models employed by Denmark are things that should be avoided like the basic income guarantee (SEE: Should U.S. adults be given a basic income just for being alive?) and the Black Plague.

Despite the sunshine and lollipops that Sanders is promising, you have to believe that there is no free lunch. Santa Claus is a myth that is enjoyed by kids everywhere because he gives things away riding a magical sleigh. When a politician promises goodies for all, the youth will eat it up. This is what Sanders has accomplished: free healthcare, free education and free money.

Something for nothing; is this what society has come to?

–AM