Pace of modern life: UK v Denmark
bbc.co.uk
bbc.co.uk
The claim that Danes are ambitious is flat out wrong. The younger generation more so, but there is a reason why danes are the "happiest people" in the world and it's not because of their ambitions.
The Danish model is under huge pressure and haven't escaped the reality of globalisation and automatisation.
But because wealth gets distributed the way it does, it doesn't feel the heat too much just yet.
In other words the Danish system is a thing of beauty as long as it works. Unfortunately it doesn't work anymore and somethings gotta give.
Edit: Was asked to be more specific.
Out of 6m people:
Almost 0.8m people on some sort of social welfare
Almost 0.8m people are working in full time positions for the public sector.
In comparison 1,9 in the private sector and it is shrinking rapidly.
It is notoriously easy to start a company in Denmark but notoriously hard to grow it among other things because most Danes don't have those ambitions and are very very risk-averse.
We are long past the point where more people are depending on the state than on the private job market and as those jobs disappear because of the named automation and globalisation and because Denmark is just too expensive, it will be hard for any government to promise the elaborate system we have now.
This is already starting to show as the latest government scramble to lower taxes for corporations and reduce the number of entitled benefits Danes can expect.
Furthermore Denmark took the wrong educational strategy and unfortunately like most of the european countries believed that knowledge worker meant book reader.
The result of this is that we have a large over educated part of the population who will have a very hard time finding a job.
Every other week, a Danish newspaper has an article about another BBC article painting another rose picture of Denmark. Is the BBC working for the Danish tourism board?!
Just two weeks ago, a BBC article claimed Danes can usually command 3 languages besides English and Danish, which hardly accurate (unless they count Swedish and Norwegian, but that's cheating!).
While Bjørnskov goes on to hide his suggestion with the fact that Danes don't like to show off (we have a culture against showing off, see Law of Jante[1], which is diminishing but very slowly), his concept of 'ambitious' does not translate into something that makes Danes particularly happier.
Our 'happiness' rating stems from our comfort, because despite the welfare state's quirks, it does work some of the time. But it is a huge drag on the treasury, and a lot of the money are not exactly spent efficiently.
Denmark is not a perfect place, and I am not sure people coming here will automatically be happier (particularly considering how we treat immigrants).
I don't think you're necessarily right about that statement. Most people I know dreams of being self-employed, especially where I grew up in Jutland. That doesn't make me right either. Both of us are using ourselves as a measurement here, and that's probably a bad idea.
You can't judge anything based on what people say they want to do, you have to do it based on what they do, especially in a country like Denmark where it's literally risk free to start a company.
In other countries you're basically screwed, if you can't get a job. You have to then seriously consider doing something on your own accord. The same incentive is largely missing here in Scandinavia.
Risk comes in many variations!
So there's a very communitarian mindset that is inculcated from an early age in Scandinavian children. The recent story on here around attitudes and how the USA is much more individually minded compared to Europe in general is magnified.
So the famous liberalism of Scandinavia is built on a single, illiberal act by the state which then sets up its citizens to have freedom. Whereas other countries allow parents to raise children in much more varied ways, you end up with more diversity but that can produce some nasty results.
As far as schooling goes, Denmark is more liberal than the U.S. when it comes to choice, because there are school vouchers (not sure if true in Sweden). If you prefer not to use the state system, you can get a voucher equal to the prorated per-student cost of public education, to spend on private education instead. One of my colleagues uses this to send her daughter to an English-language school, rather than a Danish-language school. The U.S. doesn't have any similar program that will let you choose a Spanish-language school over an English-language school (and there is huge political pressure against Spanish-language schooling, because it is seen as a failure to integrate into proper Americanness).
Although this all sounds a little bit communist and making everyone the same, they have a massive music industry export, so they're not losing creativity.
Also you might want to learn the difference between communism and socialism as you have it all wrong currently.
The only thing really difficult to acclimatize to is the language, which is hard to speak (though easy to read/write). And to some extent the weather. But Copenhagen in particular is incredibly easy to live in as a foreigner. And it is diverse enough that culture-wise you can hang out with whoever you want to, more or less; my social group includes a number of Germans, some Spaniards, some Danes, some Arabs, some Greeks, some Swedes, and some Koreans.
Seems a little more well-researched than the hopes and dreams of young westerners to go on a roadtrip, study or live and work in America based on watching 100 Hollywood movies.
You didn't describe any symptoms or argue why the Danish system no longer works or what precisely doesn't work, so it would be great if you could give some examples, facts and figures.
Are you talking about unemployment? Average wealth? Class mobility? Freedom? Pollution?
Any country that has a model that works better? US, UK, China, France, Singapore? In what way?
It appears to be some weird inferiority complex.
The focus of self-criticism in Scandinavia seems to me to be hugely disproportionately focused on describing us as doing horribly compared to everyone else in a way that seems to indicate a huge inferiority complex, where self-criticism other places seems to in general be more internally focused.
Of course there are exceptions.
The claim of the article and many others implies that Denmark is near perfect system.
That is what we are critiquing, not whether it's better or worse than other places.
It's just not as rosy red as it's portrayed and some of the claims in that article are flat out wrong.
I can say that both as someone who been an employee and an employer.
The funny thing is, referring to the inferiority complex, there's this amorphous mythical country in Europe that doesn't have a name and we can never measure up to - we're just provincials, unlike those cultured people over there, wouldn't life be so much better if... (oh, just don't look at quality of life measures!)
Average wealth: Pretty decent, but stagnant and falling rapidly relative to other western countries.
Class mobility: Very high in relative term, very low in real terms. There's a very short way to the top (and the bottom) so it's pretty easy to get there. The top just isn't very high up, so you're still upper middle class compared to other countries. Should you happen to break out of the middle class, the Jantelov-based scorn will be severe.
Freedom: Not great. Especially suspicion of tax evasion ("black work") routinely trumps basic civil liberties. The tax authorities were granted blanket permission to enter private property without a warrant if there is visible building activity.
Pollution: Very high "green" taxes on energy has made comparably cheap wood burning stoves very popular. This is then the cause of very high levels of particle pollution, especially in the winter.
Education: The extreme egalitarianism that is found across society is particularly pervasive in the educational system leading to a painfully low quality education from kindergarden to university. This has been made particularly acute by a political focus on educating the "knowledge society" which has re-wired secondary and upper education to focus almost exclusively on quantity.
I think the danish model could work fairly well, but the political system (and a more than willing electorate) has shown itself to be completely incapable of even minor reforms to substantially address the mentioned issues.
Not surprisingly, once you've gone down the list and done everything there, you're doomed.
None of these are false in themselves, but these same issues are largely common to all Western societies (the US being a bit of an outlier in some aspects), and not a sign of total failure of a specific model.
Name one Western country that isn't struggling with public spending, globalisation, automation and education issues.
And people will prefer one over the other because of their own bias as a member of any given country.
However what you can measure is the progress within you own country, is it improving or not.
One thing worth mentioning is that usually the top countries is all these articles is usually small North European countries. That suggest that human societies does not scale as databases.
> not a sign of total failure of a specific model.
It's not that it's a total failure, it's more that the scandinavian model isn't the utopia it's made out to be by its (mostly left leaning) proponents.
I think he has some legitimate, objective concerns that you have too flippantly dismissed as right wing biases.
I'm a Brit that's moved to Scandinavia and I'd recommend it broadly.
All countries have different reasons for why they are in trouble or not. All I can say is that the articles picture of Denmark is false.
Not that Denmark is going down the gutter but the problems are much more severe that the numbers show.
Do you mean that the danish "model" is broken, because the public finances run with a deficit and/or because of unemployment? It is still not obvious for me what you mean by broken.
Since the number of people employed in the public sector hasn't increased by more than around 10% since the 1980s, and the unemployment rate is now actually relatively low (5.8%), one could argue that the model really does work. It hasn't crashed over a period of 30 years. Public spending was excessive during the 2000s, so the "model" does need some refinement, and will like continue to undergoing constant refinement as the economy fluctuates.
The unemployment rate is currently dropping, and it is lower than e.g. UK (5.8% vs. 7.7%) and certainly Southern Europe. Unemployment is a reoccurring problem in a historical sense, and a much bigger problem in most of the world than Denmark. People everywhere struggle to find jobs as a consequence of increased automation. Especially, uneducated people.
Denmark is running with a deficit at the moment, but there have been years with surplus too. Of course, that could be explained by the income generated from natural resources (oil+gas), just as the deficit could be explained by fluctuations in the world economy.
The deficit in 2013 is expected to be 1.2% of GDP which isn't bad compared to everywhere else. National debt compared to GDP is higher in many countries: http://www.economicshelp.org/blog/774/economics/list-of-nati...
Another point you mention is that it is hard to grow a company because of lack of ambition in Denmark. It is hard to grow a company in Denmark, but I personally consider high salaries as a bigger problem than lack of ambition.
On a positive side, because there is very good support for unemployed people, Danish employment laws are less restrictive than many countries, making it much easier for companies to hire and fire their employees. Flexibility is very good thing for a company that wishes to grow.
If you say automation is making it hard for people to find a job, what do you propose as an alternative to educating people (you mention a large part is overeducated)?
Lowering taxes for corporations was a ridiculous idea. It is higher almost everywhere else, and nobody could give a compelling argument for lowering it. http://en.wikipedia.org/wiki/List_of_countries_by_tax_rates
Corporate tax is paid of the profit, before the profit is distributed to its shareholders. 3 percentage points lower tax of dividends, before income tax, will not change much for the shareholders of Danish corporations.
You also haven't pointed to a country with a model you feel is working better.
The article portrays Denmark as having no issues what so ever and a financially sound political model for the future.
What is broken is a lucrative and ineffective welfare system and the size of the public sector as it is primarily based on the income of the private sector.
With the majority of taxes being paid through income tax and with the number of private sector jobs disappearing and not enough new companies becoming growth companies, with a demographic structure requiring more from less and with a job market that is structurally in trouble (hidden for now by redistribution) it is bound to be trouble.
Lowering the taxes for corporations was not meant as anything but following the competition, there is nothing wrong in that. It's neither a smart move or a stupid move, it's just what you do if you don't want to add to the amount of jobs disappearing.
There really isn't anything to do by the state for those who have trouble finding jobs. There isn't some boom waiting in any foreseeable future. It's structural these days baby.
I don't find any of the current models working, but I am also more pessimistic about automation than most people.
That's clearly your opinion and you're entitled to it, but please don't state it as fact, that's just dishonest.
> Corporate tax is paid of the profit, before the profit is distributed to its shareholders. 3 percentage points lower tax of dividends, before income tax, will not change much for the shareholders of Danish corporations.
No, it's paid of the profit at the end of the year, no matter what you do with that profit, including investing it next year or putting it into a rainy-day fund.
> You also haven't pointed to a country with a model you feel is working better.
Who said he had to? Why is it a premise for debate that there is a perfect country somewhere else that's working better? But Sweden.
That lower corporate taxes doesn't benefit society wasn't actually my viewpoint, but it has been addressed quite a lot in the media. I should have pointed to some references. My bad:
Here is one from 2010. http://www.b.dk/danmark/eksperter-lavere-selskabsskat-har-li...
Two professors (one from Copenhagen Business School) and one from University of Århus states that it will have little impact.
Or a survey from business (67% of business don't think it will have an effect):
http://www.advodan.dk/nyheder/2013/4/7-ud-af-10-virksomheder...
It has also been discussed in America:
http://business.time.com/2012/02/23/will-a-lower-corporate-t...
I actually asked earlier if he could show me an example of a country with a better model to better explain in what sense the Danish model is "broken". Isn't the Swedish "model" almost identical to the Danish "model"?
I just don't get it.
The Swedish model is very similar to the Danish model, except they spent the good years implementing many of the reforms ThomPete and I have been advocating. It's not perfect, but they're doing better.
It doesn't seem in line with the fact that the unemployment rate has been dropping over the last couple of years, or that it is in fact lower than it was in the 1990s.
I know the unemployment statistics doesn't necessarily give the true numbers, but you can't just state something like that without references.
The reason unemployment numbers look decent is partly that the numbers hide a larger number of people on "not-ready-for-work" benefits and partly the fact that the baby boomers are retiring. Pensioners are not considered unemployed.
If I look at the statistics at http://www.dst.dk/pukora/epub/Nyt/2013/NR350.pdf I see a drop of unemployed of 10000 since October 2012. I don't know if that number directly translates into 10000 new jobs of the kind that were lost in your article.
But I think it is hard to determine if the 16000 mentioned in the article is just normal fluctuation over a 11 months.
With that said, the 160000 jobs lost since 2008 is significant, but unemployment was at a record low at that time. From the graph (I linked to), it looks like most of those 160000 jobs were lost in 2008 and 2009.
Do you have any numbers that do not mask pensioner's and "not- ready-for-work" people? It is hard make any actual judgment in any direction, if all the statistics are deemed untrustworthy or politically biased.
I don't think it makes sense to talk about a "private workforce" in this context, as the workforce consists of all people able to perform work.
Even looking into the future, their resource economy seems likely to persist. Oil production is declining, but fairly slowly, and natural-gas production has actually been rising. The value of hydroelectric exports has been going up as European demand for "green" electricity allows them to be sold at a premium price. There are large thorium reserves, which might some day be valuable. There are also large, barely-exploited wind resources, which could be exported like the hydroelectric ones are, though they pose more grid issues. Between all these different sources they sort of hit the energy jackpot.
I think the cold war created a unhealty general view on socialism. Distributing wealth equally seems to work very well for many countries, including Denmark, Norway and Sweden.
I lived in Switzerland for two years where they are very liberal, but still it felt like that the middle class was large and rather healthy.
Having a large, rich middle class is far better for the economy than having a small portion of super rich people and many people who can barely afford living, like in the US. This have the two following bad economic effects: Large savings for the few rich people and no purchasing power for the masses, effectively killing many businesses.
Also, its far better to have people on welfare spending money locally than having people so poor that they can't afford food and living.
I think Denmarks largest economic problem is that lack of Venture Capital. With companies such as Podio and Zendesk showing up, I think this is just a matter of time. Recently the Government made initiatives to invest in new companies with growth potential, which hopefully creates a better environment for start ups interested in growing.
Consider the alternatives: a large under educated part of the population who will/will not have a very hard time finding a job.
An educated population makes for a better society, irrespective of what "the economy" may or may not have to offer[1]. Economies can change on relatively short timeframes, while the character of societies[2] change much more slowly, if at all[3].
1. Author's opinion.
2. Substitute "character of society" with "culture" if you wish.
3. Another author opinion.
"Over educated" is interesting terminology. What exactly does that mean? Do we define education only in economic terms? Why did wealthy classes historically seek to become educated, even when "economically speaking" they already had society's best resource allocation?
I've lived the last 10 years around Øresund, in various places, and the best explanation of the danish lifestyle I've heard was that they don't expect success so they get more happier when they have it.
But I only enjoy that explanation because it fits into my little belief of how I want people to be. It says nothing about how people actually are. It's ridiculous to believe that there aren't people who strive for success and material wealth in a place so well developed as Denmark.
But, as Keynes said, "In the long run, we're all dead." Do you plan on listing your git check-ins on your tombstone? Will your epitaph be "He was ambitious?"
Most of us on this forum are fortunate enough to enjoy most of our work and are well-paid to do it. Much of our work has novel interesting and innovative results. Many of us are happy to keep working as long as we can. All the greater shame on us for not having the imagination to visualize what life is like outside our fortunate circle.
I grew up from fairly humble means and have seen my father being fired, our house go on foreclosure, him struggle with 3 jobs to make enough of a living and my mom being stuck as a cleaning lady.
Perhaps you never experienced life outside the fortunate circle, but I certainly did and I have no ambitions of ending there again.
It's entirely possible to have a successful career working 9 to 5, with a sensible commute, in vast swathes of the UK. I've spent 4 years in Edinburgh and have always lived within a 10 minute walk to work, often within a World Heritage Site.
The childcare costs are however a good point of something that other Northern European countries tend to do better at. Though our recent government spat over the ratio of staff to children shows that the public just aren't rational on the issue so changing it would be hard.
If it hadn't been for work situation (especially that his mom is a UK solicitor with a big firm and wouldn't stand much chance of getting a decent job in Norway), it'd have paid off massively to move "back home" for a few years.
Oh, that's the sociology dept.
I've only been to Denmark a few times but I think the feeling I got is that they are happier because they have managed to largely sidestep the otherwise ubiquitous trap of perpetually escalating expectations.
The American/capitalist model is that each achieved goal is a platform for the next goal. Growth is what matters. Being satisfied with a decent job and a peaceful context in which to love your family is not any less ambitious than desiring to get rich or "change the world." It's just ambitious in a different direction.
Americans, for example, optimize for economic performance. Danes, I think, optimize for happiness. The tantalizing, troublesome idea that captivates me as an American is that money as an abstraction of 'value,' when survival is assumed, might only be desirable as a tool for being happier.
And if the pursuit of money, on a societal level, interrupts the pursuit of happiness, that implies that we capitalists are doing it wrong.
1. Taxes are ridiculous (my friend is in the 65% bucket, sixty five, after 2 years of work experience).
2. There is a huge amount of people living on welfare State.
3. The University system is far from ideal. Not much competition, grades are given almost randomly and tend towards a political 7 (average)
4. You pay 180% (one hundred and eighty) of taxes on top of the value of a new car (180%...) when you buy it
5. The cost of living is high, very high
6. Foreigners, if they are not from US, are not very welcomed (say what you want on this, it's been my and others impression). Compare this with, say, Germany, and you see a big problem right there
7. There is not really much good work. I get it, 5-6 mln people, but finding a work in Denmark without Danish is like finding the eldorado
Overall, I would not take this country as a "model". If you want a model, take Germany. Germany managed to get out total destruction (world war II) and the whole West/East mess without asking help to anybody. Germany today is probably one of the most open countries to foreigners. The Police in Germany is great with everybody (I had my bad experiences with the Danish one doing absolutely nothing wrong...).
Sometimes you need to look deeper to see what's really going on in a country. "Working hours" should not be the only way we measure things.
They aren't that high if you consider what they include. My take-home pay proportion stayed about the same when I moved from California to Denmark (I didn't qualify for the special foreigner tax, which would've made it even lower). The effective (rather than marginal) tax rate if you make a middle-class salary in Denmark is ~40%, including what the U.S. splits out as payroll taxes. In California, I paid about 30% total, but that didn't include healthcare. I had to buy health-insurance separately, and it cost me about 8% of my income. Also, Danes don't have to make student-loan payments, which is another quasi-tax on middle-class American incomes.
The relative comparison does depend on where in the middle-class (a broad term) you are: Denmark's tax rates are more competitive if you make $70k than $200k, in part because they're progressive, and in part because healthcare, student loans, and payroll taxes bite a bigger proportion of your paycheck in the U.S. if you make $100k or less. It also depends on whether you're self-employed: in the U.S., individually purchased health-insurance plus 15% payroll taxes for the self-employed take a big bite of your income up front.
As far as cars, I found my transportation costs have gone down significantly, precisely because I don't have to own a car, since the transit and bikeability is good. I had no choice previously, because the Bay Area's transit sucks (no, Caltrain + VTA Light Rail is not good enough). So that was another 5% or so of my income sunk into owning a car that I'm now free of. Overall, a bigger % of my income here goes into my bank account as discretionary income. And that's not even accounting for the greater peace-of-mind (and implied present value) of having a better safety net.
Taxes are maxed at 57% for income above $70000/year. It is around 40% for income less than $70000. The initial around $10000 are not taxed. You'll never get to 65%.
A huge amount of people living on welfare is not by itself a bad thing. It is better than having the running around in the streets looting to survive.
Both the University of Copenhagen and of Århus are on the world top 100 list. http://www.topuniversities.com/university-rankings/world-uni... . I don't know why you think grades are given randomly or politically, or why you are missing competition.
Cost of living in Denmark is lower than e.g. Norway... It is also not necessarily a bad thing. Salaries are also higher.
Danish is the official language. I suspect you'll have as much difficulty finding a job in Germany where you don't have to speak German, or in France w/o French.
With that said, it does sound like you had some bad experiences in Denmark.
I agree with you on universities, but they do not foster, in my opinion, healthy ambition and innovation. Danish students know they will have a job and a good income no matter what and that's not helping growth. On top of that, you also have fake ones like Via which I still wonder what they are doing exactly.
Local language requirements are a fast way to see how a country/region is open to foreigners. Denmark is not. Will it be? I do not know. Of course, you get asked German in Germany too, but here they do not have 94% of the population speaking very good English.
With that said, my experience in Denmark was great! I am just tired of this glorification of Nordic countries just to justify broken spending oriented public policies (look where did they bring us...).
It is still 57% not 65%. But also still too high in my opinion.
> If 1000 of salary increase brings you 350, the incentive of being "ambitious" is drastically reduced.
Likely true and the topic of an ongoing discussion in Danish politics.
> Local language requirements are a fast way to see how a country/region is open to foreigners. Denmark is not. Will it be? I do not know. Of course, you get asked German in Germany too, but here they do not have 94% of the population speaking very good English.
I am not sure I understand you. Should Denmark have more English speaking jobs than Germany, because Danes are better at English than Germans (or is it the other way around?)? That aside, I know many bilingual workplaces in Denmark, and I think the number is growing.
> I am just tired of this glorification of Nordic countries
Nordic countries are expensive to run and are glorified for their welfare system. Other countries are glorified in the media for low taxes, growth, culture, food, environmental friendliness, etc.
Something is always better somewhere else...
Well the Brits have an institutionalised system of honouring people who achieve.[1] Everyone from sports people to business people. Obviously it's incredibly political but it is taken very seriously.
[0] - http://en.wikipedia.org/wiki/Law_of_Jante [1] - http://en.wikipedia.org/wiki/British_honours_system
To me janteloven seems more like a subtle attitude that is not really discussed much but is rather felt (like many cultural norms, really).
#Relevant because it's part of Scandinavia
/me rins.
A good illustration of the extreme importance of being self deprecating is how a big part of Norwegian mythos around the Norwegian royal family is how the then king took a tram when wanting to go skiing in '73 during the fuel crisis, and "even" took out his wallet to pay (During a period, using private cars during the weekends was illegal, and while the royal family almost certainly would've gotten dispensation, they judged it to send a bad signal). Google even autocompletes "kong olav trikken" (king Olav tram) for me if I type in "kong olav", and you'll find pictures of it in most Norwegian history books...
(The hilarious part is that this was partially staged: the press heard he'd taken the tram, and nicely asked if they might be allowed to come along next time and were given the ok by the palace; had people in general been more media savvy at the time, it'd likely have had the opposite effect)
People are generally happy for the success of other people, and if they even managed to create jobs for others it's even better.
So if Denmark is in some way "better," it's only better for those who are allowed to join the club. Of course, that doesn't mean others can't adapt Danish ideas about education and redistribution to our country.