All media is fully or partially state sponsored, a third of the adult population is on some kind of welfare (incl public pension or student grants), a third of the adult population work for the government, and only a third of the adult population work in private companies, many of which derive all or a big part of their income from the domestic or foreign public sector (pharmaceuticals, clean energy, etc).
Direct and indirect taxes take huge part of income. If you wanna buy a car, taxes are roughly 180 percent plus 25 percent VAT (also VAT on the tax). Those taxes you pay with income that has already been taxed 40-60 percent.
Almost all education, health care, energy, mass transportation is public.
I left the country, but not because of the political or economic system. Quality of life in Denmark is very high and I think most Danes like the socialism of Denmark.
Other Scandinavian countries are similar and also with very high quality of life. Most European countries are to some degree also quite socialist and life there is generally good. So I think it's safe to say that socialism can work.
How is class mobility in scandinavian states? Can you work your way up from the dregs of society to the top levels?
If I want my kids to go to a great school like Stanford or Harvard, can I reasonably expect to be able to find a way to cover tuition as a member of the middle class?
If I'm looking for a job in the $200k US range, what are my potential career options?
What kind of housing can I expect to find if I'm a sole earner as a software engineer with a family of 6?
Social mobility is higher than in the US but the highs are lower.
Almost nobody makes $200k in Denmark, and fewer make it year after year. Even lawyers, dentists, medical doctors usually make less. But you also don't really need it. Public services such as schools, universities and hospitals are great.
You wouldn't be able to live anywhere near Copenhagen if you are on a developer's salary and you need space for 4 kids. Most women in Denmark work. It's not a place designed for one income.
> Speaking at Harvard's Kennedy School of Government, Danish PM Lars Løkke Rasmussen told students that he had “absolutely no wish to interfere the presidential debate in the US” but nonetheless attempted to set the record straight about his country.
> "I know that some people in the US associate the Nordic model with some sort of socialism. Therefore I would like to make one thing clear. Denmark is far from a socialist planned economy. Denmark is a market economy,” Rasmussen said.
> “The Nordic model is an expanded welfare state which provides a high level of security for its citizens, but it is also a successful market economy with much freedom to pursue your dreams and live your life as you wish,” he added.
I just found this quote from the Danish PM. What I find interesting about it is that it indicates the kind of distrust of socialism that I grew up with. I don't feel that social programs are bad, but socialism as a political goal is particularly disturbing. Based on history, governments should not be trusted with that kind of control - even if there are altruistic people involved, the bureaucracy can't meet the changing demands of society. And there are few altruistic people involved in government.
Personally, I think that people in the US shouldn't be thinking about solving problems with more welfare, but in figuring out what's wrong with existing welfare programs which are extensive. That and we need to revise the kind of productivity and consumer friendliness that we expect out of our government. Things like Universal Income wouldn't be considered if someone in trouble could expect to receive help in a timely manner, and if the help was smart and not tied to rules that don't make sense and put additional burdens on struggling people. Most people that are dissatisfied with our current welfare system would be astonished at the resources that are available, and frightened by the hoops that people have to jump through to receive much of it. We've been exposed in a small part by the health care changes recently, but I doubt anyone in my current social circle has experienced waiting in line for 16-24 hours at a social security office, nor have they known anyone who has tried to work for free in order to work their way up the ladder to a job that would both get them off of a welfare program and provide enough income to get by. I've gone off on a tangent, so I'll stop now. :) Your perspective was helpful to me.
Someone has to pay dearly for all these extravagant social programs.
http://www.huffingtonpost.com/2015/01/21/map-expensive-count...
Yes, and in Scandinavia we do. In Greece they didn't, hence the problem.
This is a well-written and heartfelt statement of a point of view on this topic and it deserves respect for that, even if you fundamentally disagree with its thesis ( as I do, on at least two separate counts ).
This is not a capitalism vs socialism or left vs right issue.
Nobody said that this new form of wealth transfer will replace existing forms of wealth transfer. The goal here is that it would run in tandem with existing forms of redistribution. It is a delusion that it will ever be enough. Once UBI is in place, other forms of egalitarianism will soon follow until communism is attained. These initiatives are but like a hammer seeking to equalise all the nails on a given piece of wood.
>America - transfers wealth already in many ways
I'm both well aware and firmly opposed to all forms of wealth transfer (inflation, welfare programs, excessive taxation et al). It is beyond atrocious and I couldn't speak less favourably of it.
Workers should also be compensated according to the quality of work (read: value brought in) that they produce. Workers can and should be wealthy too under this premise.
It isn't compensation for entreprenurial risk that people object to, but compensation for risks taken with Other People's Money (OPM), where the government supplies an implied safety net (Too Big to Fail).
By extension, people object to success (whether though skill or luck) for a risk-taking entrepreneur including entry into the ranks of the capitalists, that group of people who have enough money that participation in OPM schemes is enough to sustain their membership in the exclusive club.
In other words, the prize for winning the game once shouldn't include getting to play risk-free from then on.
> Workers should also be compensated according to the quality of work (read: value brought in) that they produce. Workers can and should be wealthy too under this premise.
OK, so what is the flaw in the current setup that prevents workers from receiving their share of the wealth created? How do you think the system should be changed?
I have no problem with that and I agree with you (but you don't seem to think so). I think it works very well. It's brilliant that many companies have ESOPs. Early employees that take on risk by joining fledgling companies get huge rewards when things pan out. Even workers who come into the business at later stages can get huge gains of they are deemed to bring in proportional value.
>government supplies an implied safety net (Too Big to Fail).
I am very much against this myself. I despise it even. Socialised losses and privatised gains are evil.
This seems to be the crux of our disagreement. I don't think the current setup works very well, at least not for the bottom 3/4 of the US population.
Basically, it was working OK until circa 1975, after which point any gains in improved productivity started accruing to owners of capital almost exclusively. And the more capital you have, the larger your share of those gains, in a superlinear fashion. Meanwhile worker compensation (as measured in constant dollars) has stagnated and even shrunk somewhat recently.
This is the essence of capitalism and why it works well. Gains exponentiate and as well they should. Capitalism favours retention of capital goods as opposed to the consumption of said capital. What has happened is that many folks have engaged in consumerism and the savings rate has gone down immensely. This phenomenon has negatively affected the middle class and working class more than any misconstrued notion of increased productivity without corresponding increase in compensation. If you're to address the culprit, start there.
You cannot invest into a better future if you consume everything and this is exactly what has happened. Nobody cares about savings anymore. Such high time preference, it's horrible!
Here's an excerpt from an Austrian (school) blog:
Low time preference people value present use of their money less than a certain higher future quantity of money. High time preference people, in contrast, are willing to forego higher future quantities of money for sake of enjoying a certain lower present quantity of money. The low time preference people will therefore be inclined to lend to the high time preference people.
That last part is extremely vital. It explains the perpetual cycle we seem to be in. The middle class and working class engaging in excessive consumerism will at some point need to borrow money from the fiscally disciplined to engage in even more consumerism. It has been claimed that the current savings rate is only comparable to that of medieval peasants (more validation needed on this but if it is the case, this is terrible).
If all this is true, why would those gains you mention above fail to grow in a superlinear fashion?
I think it is a case of eroded values more than anything else.
Sure, over time. But what I'm talking about is that the more capital you have the greater your rate of return.
> the savings rate has gone down immensely
Well, no wonder. Have you looked at the interest rate you get on a savings' account? You can't even keep up with inflation that way.
> why would those gains you mention above fail to grow in a superlinear fashion?
You assume that all uses of borrowed capital are consumed with no ROI, when much of it is invested in present or future health (healthcare, better food, safer car), education (particularly through paying higher home costs to get kids into a better school), property improvements, cost savings (more fuel efficient vehicles) and the like.
Sure, a chunk of it is spent on entertainment of various sorts that doesn't have a clear ROI, but this is actually the one area where the consumers' buying power has increased, even accounting for inflation, and the average % of income spent on entertainment has actually gone down considerably.
So, while I certainly agree that compounding interest can account for some of the disparity, it doesn't account for all of it. Rather, we see that the top layers of society are raking in a greater and greater share of the total earned income, entirely aside from the compounding returns from renting out their accumulated capital.
There is no real reason that the CEO of a corporation should receive 300x the salary of a lowly employee, except that the boards that set compensation are comprised solely of people from the same social class.
> I think it is a case of eroded values more than anything else.
Uh huh. So, being poor is a moral failing, is it?
Next you'll be telling me that low incomes give poor people an incentive to work harder, but that we need to pay rich people more so that they have an incentive to work harder.
>Is it from a personal perspective or is it something you have been taught?
I have seen immense poverty and experienced it myself though to a milder degree. So, I'm not putting forward my suggestions out of a sense of being callous, quite the opposite actually. Capitalism is the best way to solve the problem of poverty and supposed inequality. Provision of goods and services of value to others is the best way to earn an income and build a truly sustainable world.
It is indicative that it is indeed dictatorship of the majority since I have received a massive number of downvotes for my sentiments on this matter.
If 5 people come to you and take your car from you, most reasonable humans would call that theft and consider it to be immoral.
The same 5 people come to you and say, we're going to take a vote on whether we should take your car and give you a bicycle, but here's the consolation, you will also be included in the democratic process. I think we all know what the outcome of such an election would be. Would you consider that to be a moral or immoral thing?
Just because I'm included in a democratic process which I didn't sign up for in the first place doesn't make it right to replace my car with a bicycle.
North Korea calls itself Democratic People's Republic of Korea, should I criticize democracy because North Korea calls itself this way?