When asked to name a successful example of democratic socialism, one nation always rises to the top of the list: Denmark. However, a Reuters news story shows that the socialists' model nation is providing fewer and fewer services to citizens despite its hefty tax bill.
Aase Blytsoe, a 92-year-old pensioner with dementia, is one example. Her apartment will be cleaned 10 times a year, about half as often as it had been. Making up the difference would cost more than 10 percent of her monthly pension.
The Danish welfare state teeters precariously on a pyramid of intergenerational wealth transfers. Danes typically bear the highest tax burden (with France just tying them this year at 46 percent of GDP) and one of the highest levels of social welfare spending in the OECD.
Unfortunately, the number of people outside the workforce surpassed the number of workers contributing to the system in 2009. So, Denmark has begun curbing services – and discouraging immigration – to control its exploding welfare costs.
Aase's story percolates throughout Danish society. A new Reuters story reveals:
- One of every five public schools has closed;
- One of every four state-run hospitals has closed in the last decade;
- “A recent survey showed that more than half of Danes don’t trust the public health service to offer the right treatment. As a consequence the proportion of the 5.7 million Danish population taking out private health insurance has jumped to 33% from 4% in 2003, according to trade organization Insurance & Pension Denmark.” A similar phenomenon is taking place in Finland;
- The retirement age in Denmark has been raised from 65 to 73, the oldest in the world; and
- “Spending per person above 65 years on services such as care homes, cleaning and rehabilitation after illness has dropped by a quarter.”
Nonetheless, U.S. politicians hold up the Nordic nations as a prototype for America's future. Senator Bernie Sanders said, “I think we should look to countries like Denmark, like Sweden and Norway, and learn what they have accomplished for their working people.” Sanders and his fellow travelers became so focused on Denmark that Danes found themselves alternately bemused and bewildered by the attention.
Denmark has a market economy smothered by a welfare state so immense that it cannot support itself.
They were also perplexed by the desciption of their nation as “socialist.” Last Demember, the Center for Political Studies (CEPOS) issued a 20-page report clarifying that Denmark is not socialist. (You can hear me discuss the report on a recent episode of the “Acton Line” podcast here.) In 2015, the prime minister delivered a similar message while visiting Harvard. Economist Lars Christensen said Denmark's “major political parties on the center-Left and the center-Right would oppose many of the proposals of Bernie Sanders on the regulatory side as being too leftist.”
Denmark has a market economy smothered by a welfare state so immense that it cannot support itself.
Instead, it seeks to close the door to new applicants for its generous government transfer programs. It has taken to heart Milton Friedman's truism that “you can't have free immigration and a welfare state.” The government took out ads in Lebanese newspapers inviting Syrian refugees to go somewhere else. It briefly suspended train services to Germany to stop Middle Eastern migrants from entering the country.
Even the poorest migrants must support the Danish welfare state. Denmark passed a law seizing all a migrant's belongings over the amount of $1,450. Apparently, you're never too poor or vulnerable to “pay your fair share” in a social democracy.
Any welfare state must inevitably encounter the economic reality of scarcity. This is the driving truth behind Margaret Thatcher's obervation that “the problem with socialism is that you eventually run out of other people's money.”
“People tend to handle scarcity through productive activity or by making demands” of the government, wrote the Lithuanian Free Market Institute. “In the former, human action and creativity bear fruit, but in the latter, force or political power is used to achieve results through expropriation and redistribution.” Free market nations see each person as a blessing, able to use his (or her) God-given gifts and talents to serve others. Mutual service creates and spontaneously distributes wealth, and empowers citizens to live out their values.
Public funding demands the government intrude into the most intimate of human bonds in order to enforce conformity to politically determined norms. Danish authorities will not allow immigrants to challenge the unity of the homogenous nation with a population about the size of Wisconsin. Starting at the age of one, Denmark separates immigrant children born in government-designated “ghettos” from their parents for up to 25 hours a week to teach them “Danish values.”
“In Denmark, there is a very different understanding of what 'freedom' means,” Sen. Sanders wrote in a 2013 essay.
Choose wisely.
(Photo credit: Michael Vadon. This photo has been cropped. CC BY-SA 2.0.)
