Good article for believers in Bernie's Scandinavian eutopia

[DarrinS]

http://www.usnews.com/opinion/economic-intelligence/2014/12/18/why-sweden-denmark-and-norway-have-high-taxes-and-still-show-up-to-work





Heaven on Earth?

American progressives are mistaken to think the Scandinavian model is an argument for high taxes and subsidies.

A small number of overwhelmingly white Northern European countries with a Christian cultural heritage or even a Protestant established church are, for quite a few American progressives, the place to turn to for public policy inspiration. This can probably be explained by a strong belief that those countries – Denmark, Sweden and Finland, perhaps even Iceland, the Netherlands or Austria – are characterized by more equal outcomes, higher rates of social mobility, better public education and higher taxes. (I suppose that secularism, drug policy and bike lanes help as well.)

The high taxes are particularly awesome, especially because they don’t seem to destroy everyone’s willingness to show up to work. Now, it is obviously infuriating to believe that other countries have discovered and implemented a technology to immanentize the eschaton, and that you could, too, if only your political opponents believed in science and weren’t so racist. Why, you ask, why, tell me why!


Well, to the rescue comes Henrik Jacobsen Kleven, an economist at the London School of Economics, writing in the most recent number issue of the Journal of Economic Perspectives – not quite a peer-reviewed journal, but as an outlet of the American Economic Association it does provide articles with at least a veneer of intellectual authority. Professor Kleven asks the question and titles his article: “How Can Scandinavians Tax So Much?” He is Scandinavian himself, so perhaps he can tell us what he learned before he escaped Denmark’s high tax rates.

Professor Kleven limits his analysis to Denmark, Sweden and oil-rich Norway because those countries are all generally associated with Abba instead of Björk, delicious cheese or Russian invasions. They are also small, prosperous countries, with an average population comparable in size but not in ethnic and cultural diversity to that of Massachusetts. Their joint population is smaller than that of the state of Texas.


The good professor finds three quantifiable reasons that may explain why taxes in Scandinavia are high, yet the incentives to be productive remain. The first is third-party verification of taxable income. There is a lot of that in Scandinavia, but even so Scandinavia remains an outlier. The second one only seems to apply to Denmark: It has a clean and transparent tax system, without many loopholes and deductions. This keeps people from sheltering their income. It also keeps high-income foreigners from coming to or staying in your country. (Native Danes, in contrast, seem to be quite attached to their homeland.) Third, the Scandinavian countries subsidize a lot of things that are complementary to work – such as education, child care, elder care and transportation – thereby compensating for their high taxes. Here again, they are outliers. Other Organization for Economic Cooperation and Development countries reach very similar participation rates with very low levels of such subsidies. Would those policies work in other countries? Perhaps. But perhaps they are all just manifestations of a highly productive public sector that the people like to put to use to do stuff.

And there is more that sets Scandinavia apart. So far we have looked at fairly clear-cut correlations of quantifiable numbers between zero and one. But might policy and politics be downstream from culture? Well, that certainly appears to be the case once we look at Scandinavian culture. Scandinavians trust their fellow citizens. They think poor people have typically been unlucky instead of lazy. They vote actively and participate in civil society. They respect the rule of law, and they donate to charity. Professor Kleven recognizes all of these things, and ultimately chooses not to guess what causes what.


Yet for the ambitions of American progressives, that distinction matters very much. If all of these things are so precisely because the Scandinavian countries are small and homogeneous and have been that way for quite some time, then there is not much to be learned from this Scandinavian business. The Scandinavians themselves seem quite confident that they know the answer: culture matters and that their countries are small and homogeneous matters. They are the most Euroskeptic peoples of the continent. Norway is not a member of the European Union, Sweden joined only recently, and none of the three adopted the eurozone’s common currency. They seem to like their small, homogeneous countries just fine. And perhaps that’s what Scandinavia ultimately teaches us: the value of subsidiarity, not of subsidies.

[DarrinS]

It's worth pointing out that it's not just rich that pay for all those goodies. They tax the shit out of their middle class.

[boutons_deux]

It's worth pointing out that it's not just rich that pay for all those goodies. They tax the shit out of their middle class.

they get a lot in return.

and "heaven on earth" is bullshit ridicule and strawman.

Quality of life in Scandinavia and many Euro countries is higher for more people than in USA, as is socio-economic upward mobility.

The American Dream is Dead.

[ChumpDumper]

So Darrin's argument is that minorities ruin everything.

[DMX7]

they get a lot in return.

and "heaven on earth" is bullshit ridicule and strawman.

Quality of life in Scandinavia and many Euro countries is higher for more people than in USA, as is socio-economic upward mobility.

The American Dream is Dead.

"Quality of life" will never be as important as money in America.

We've been conditioned to believe that which why the very thought of higher taxes is so appalling to some.

[boutons_deux]

I bet most American don't even have the concept of Quality of Life in their Tee Vee watchin heads

[RandomGuy]

http://www.usnews.com/opinion/economic-intelligence/2014/12/18/why-sweden-denmark-and-norway-have-high-taxes-and-still-show-up-to-work

I am a bit surprised that an analysis of those countries economic status did not include the sizeable effect of Norways sovereign wealth fund. $882Bn buys you an awful lot of income.

"They think poor people have typically been unlucky instead of lazy." Far cry from our blame the victim culture driven by right-wing hysteria. If the author says that culture matters, and that is important to the success of a country, this would suggest, that progressives call for investment in poor people seem to bear fruit. A bit counter to what you and others here blather about.

The article is, essentially, like so much you post here, a non sequitur. It begs the question, then refuses to quantify its underlying assertion, falling victim to the same thing it accuses progressives of.

If you don't understand what I just said, that also would not surprise me.

Culture matters, but the effects are ill defined.

Can you quantify it, please? How much? What does it effect? Why do you think that?

[RandomGuy]

So Darrin's argument is that minorities ruin everything.

Essentially.

Together with "culture matters, and their culture that doesn't blame the poor for being poor", contributes to their overall well-being. Not quite saying what he thinks it does.

[RandomGuy]

"Quality of life" will never be as important as money in America.

We've been conditioned to believe that which why the very thought of higher taxes is so appalling to some.

Agreed. We worship money in this country so much that we place it above most people.

[DarrinS]

Bottom line -- it won't work here. I doubt the average American tax payer would stand for that level of taxation.

[Winehole23]

Bottom line -- more emotive prose and PFA arguments from DarrinS.

[DarrinS]

Bernie keeps talking about those billionaires. If you took the combined wealth of those billionaires and divided it equally, that would give a bit less than $7K for every person. That wouldn't even get you one semester at UTSA. :lmao

[boutons_deux]

Bernie keeps talking about those billionaires. If you took the combined wealth of those billionaires and divided it equally, that would give a bit less than $7K for every person. That wouldn't even get you one semester at UTSA. :lmao

your math, and you, are always suspect, but give your solution to USA's World Champion (increasing) Inequality.

[DMX7]

Agreed. We worship money in this country so much that we place it above most people.

including ourselves, which is the most egregious thing.

[Spurminator]

Believe it or not, younger generations care more about experiences and community and are willing to sacrifice a monetary "number" for those things. Our hostility towards taxation stems from a fairly unique American ideal of counting our money. That will go away as more boomers die off and more young people become voters. Not a moment too soon, either.

[Infinite_limit]

Believe it or not, younger generations care more about experiences and community and are willing to sacrifice a monetary "number" for those things.
While you might be right, a big portion of this mindset is a byproduct of younger generation living at home & remaining jobless.

Kinda how "every teenager" is a Liberal. By 30 years old, many have changed. More life experiences naturally turns most Americans conservative

[101A]

Bernie keeps talking about those billionaires. If you took the combined wealth of those billionaires and divided it equally, that would give a bit less than $7K for every person. That wouldn't even get you one semester at UTSA. :lmao

Making 4 year public institutions free for all would accomplish at least the following:

* Make college grades 13 - 16
* Encourage even more idiots who have no chance of finishing college to run up debt on living expenses while they pretend to be academics - eventually, we'd probably have to eventually pay for that part, too; or just make college another public school, and the "kids" just live at home and go to the one most geographically convenient.
* Put trade schools out of business - "can't compete with free"
* Put private colleges without major endowments, or significant pedigrees out of business - can't compete with "free"
* Make State colleges defacto National Colleges (that is where, after all, most of their money would come from)
* Put more separation between the (now) massive cattle-call public institutions and the elite private universities that remain. Essentially, the already advantaged upper-class, far from being threatened by this new rush of "college" graduates, would cement their position, until the revolution, at the top of society.


Now free college CAN work; we just have to look to Norway for how to do it (from Wikipedia). Merit based, and limited. Free for all would be a disaster.


Admission to bachelor level programs is coordinated through the Norwegian Universities and Colleges Admission Service (https://en.wikipedia.org/wiki/Norwegian_Universities_and_Colleges_Admission_Serv ice) based on a point scale, with the highest ranking students offered a place. Points are awarded based on average grades from upper secondary school, but additional points are awarded students with secondary two-year course specialization, science specialization, age and fulfilled one year of higher education, military service (https://en.wikipedia.org/wiki/Military_service) or folk high school (https://en.wikipedia.org/wiki/Folk_high_school). Secondary school grades can be improved to increase points, but 40% of the places are only offered based on original transcripts without age or study points.

What Scandinavia has that is sorely lacking across the American political landscape is common sense. Ideology and tribalism trumps everything else.

[boutons_deux]

"Making 4 year public institutions free for all would accomplish at least the following:"

Modify France's strategy: free college, and make the first year brutal to get rid of the dreck.

and/or establish (and enforce) rigorous acceptance criteria.

also, establish minimum grade average to be maintained all 4 years.

iow, 4-year taxpayer colleges could be free, but they must ensure that taxpayers get their money's worth in serious students.

[Splits]

^what are you talking about? He's not saying EVERYBODY gets into a 4-year university, he includes vocational schools and community "colleges". He even references Norway and Germany as examples.

[101A]

"Making 4 year public institutions free for all would accomplish at least the following:"

Modify France's strategy: free college, and make the first year brutal to get rid of the dreck.

and/or establish (and enforce) rigorous acceptance criteria.

also, establish minimum grade average to be maintained all 4 years.

iow, 4-year taxpayer colleges could be free, but they must ensure that taxpayers get their money's worth in serious students.




I agree, but, seriously, does this country have the will to enforce those restrictions? What if they adversely affect minorities?

[boutons_deux]

I agree, but, seriously, does this country have the will to enforce those restrictions? What if they adversely affect minorities?

yep, exactly, just a "dream". America is increasingly fucked up, esp K-12, and can't do shit, can't fix shit anymore.

[101A]

^what are you talking about? He's not saying EVERYBODY gets into a 4-year university, he includes vocational schools and community "colleges". He even references Norway and Germany as examples.

This is from Sander's Site:


Eliminate Undergraduate Tuition at 4-year Public Colleges and Universities. This legislationwould provide $47 billion per year to states to eliminate undergraduate tuition and fees at publiccolleges and universities.Today, total tuition at public colleges and universities amounts to about $70 billion per year. Underthe College for All Act, the federal government would cover 67% of this cost, while the states wouldbe responsible for the remaining 33% of the cost.To qualify for federal funding, states must meet a number of requirements designed to protectstudents, ensure quality, and reduce ballooning costs. States will need to maintain spending on theirhigher education systems, on academic instruction, and on need-based financial aid. In addition,colleges and universities must reduce their reliance on low-paid adjunct faculty.States would be able to use funding to increase academic opportunities for students, hire new faculty,and provide professional development opportunities for professors.No funding under this program may be used to fund administrator salaries, merit-based financial aid,or the construction of non-academic buildings like stadiums and student centers.

[101A]

^what are you talking about? He's not saying EVERYBODY gets into a 4-year university, he includes vocational schools and community "colleges". He even references Norway and Germany as examples.

I had assumed like you, but then I heard him at the debate, and looked it up. He said it, I read it, I stopped looking. If there's more that makes it more reasonable, I'd like to see it.

[Splits]

If tuition at public colleges today is $70 billion, and he wants to fund 2/3 of that at the federal level for a price tag of $47 billion, then by definition he is not increasing the number of people who get into public colleges. All for less than 10% of our military budget. Seems like money well spent.

[101A]

If tuition at public colleges today is $70 billion, and he wants to fund 2/3 of that at the federal level for a price tag of $47 billion, then by definition he is not increasing the number of people who get into public colleges. All for less than 10% of our military budget. Seems like money well spent.

So, a major "free college" government program, and enrollment remains static? Wouldn't, at least, people who currently attend private universities want to transfer to the free option? Some of those, ostensibly, would be better qualified than current attendees of the state school; would enrollment increase, or would those current (or potential) students be displaced?

Also, part of his proposal is to "replace adjunct faculty with permanent". Doesn't that cost more (my wife's a tenured professor - the answer is "Yes")? Again, not static.

And that's just a couple of thought threads related to this.

Please think critically.

[Splits]

So, a major "free college" government program, and enrollment remains static? Wouldn't, at least, people who currently attend private universities want to transfer to the free option? Some of those, ostensibly, would be better qualified than current attendees of the state school; would enrollment increase, or would those current (or potential) students be displaced?

Also, part of his proposal is to "replace adjunct faculty with permanent". Doesn't that cost more (my wife's a tenured professor - the answer is "Yes")? Again, not static.

And that's just a couple of thought threads related to this.

Please think critically.

But none of that wasn't the basis of your critique. You assumed 100% of people would be attending college, which is false.

[boutons_deux]

"replace adjunct faculty with permanent"

I read where a lot of these people are on public assistance, living the horror and stress of the "gig economy", while college sports programs lose $Ms, building 5-star dorms, and hiring an excessive number of high-paid non-teaching staff who suck down $Bs in college budgets.

[Infinite_limit]

I'm actually surprised Bernie is feeding the University System. I guess switching to more trade oriented is too large a change even for Bernie

More liberal art majors? Eh

[101A]

But none of that wasn't the basis of your critique. You assumed 100% of people would be attending college, which is false.

Silly fucking me. It's not like it's called the "College for ALL" plan!

[Winehole23]

Now free college CAN work; we just have to look to Norway for how to do it (from Wikipedia). Merit based, and limited.Academics aren't for everyone. We're all special snowflakes, but not all in the same way. Education should reflect that.

[boutons_deux]

Something Not Rotten in Denmark

No doubt surprising many of the people watching the Democratic presidential debate, Bernie Sanders cited Denmark as a role model for how to help working people. Hillary Clinton demurred slightly, declaring that “we are not Denmark,” but agreed that Denmark is an inspiring example.

Such an exchange would have been inconceivable among Republicans, who don’t seem able to talk about European welfare states without adding the word “collapsing.” Basically, on Planet G.O.P. all of Europe is just a bigger version of Greece. But how great are the Danes, really?

The answer is that the Danes get a lot of things right, and in so doing refute just about everything U.S. conservatives say about economics. And we can also learn a lot from the things Denmark has gotten wrong.

Denmark maintains a welfare state — a set of government programs designed to provide economic security — that is beyond the wildest dreams of American liberals. Denmark provides universal health care; college education is free (https://www.washingtonpost.com/news/worldviews/wp/2015/02/04/why-danish-students-are-paid-to-go-to-college/), and students receive a stipend; day care (http://www.theguardian.com/society/2012/feb/18/britain-learn-denmark-childcare-model) is heavily subsidized. Overall, working-age families receive more than three times as much aid (http://www.oecd.org/els/soc/OECD2014-Social-Expenditure-Update-Nov2014-8pages.pdf), as a share of G.D.P., as their U.S. counterparts.

To pay for these programs, Denmark collects a lot of taxes. The top income tax rate is 60.3 percent (http://stats.oecd.org/index.aspx?DataSetCode=TABLE_I7); there’s also a 25 percent national sales tax (http://www.oecd.org/denmark/revenue-statistics-and-consumption-tax-trends-2014-denmark.pdf). Overall, Denmark’s tax take is almost half (https://stats.oecd.org/Index.aspx?DataSetCode=REV) of national income, compared with 25 percent in the United States.

Describe these policies to any American conservative, and he would predict ruin. Surely those generous benefits must destroy the incentive to work, while those high taxes drive job creators into hiding or exile.

Strange to say, however, Denmark doesn’t look like a set from “Mad Max.” On the contrary, it’s a prosperous nation that does quite well on job creation. In fact, adults in their prime working years (https://research.stlouisfed.org/fred2/graph/?graph_id=262756) are substantially more likely to be employed in Denmark than they are in America. Laborproductiv (http://stats.oecd.org/Index.aspx?DataSetCode=PDB_LV)ity in Denmark is roughly the same as it is here, although G.D.P. (http://krugman.blogs.nytimes.com/2015/10/18/danish-doldrums/)per capita is lower, mainly because the Danes take a lot more vacation.

Nor are the Danes melancholy: Denmark ranks at or near the top on international comparisons of “life satisfaction (http://www.oecdbetterlifeindex.org/topics/life-satisfaction/).”

It’s hard to imagine a better refutation of anti-tax, anti-government economic doctrine, which insists that a system like Denmark’s would be completely unworkable.

But would Denmark’s model be impossible to reproduce in other countries? Consider France, another country that is much bigger and more diverse than Denmark, but also maintains a highly generous welfare state paid for with high taxes. You might not know this from the extremely bad press France gets, but the French, too, roughly match U.S. productivity, and are more likely than Americans to be employed during their prime working years. Taxes and benefits just aren’t the job killers right-wing legend asserts.

Going back to Denmark, is everything copacetic in Copenhagen? Actually, no. Denmark is very rich, but its economy has taken a hit in recent years, because its recovery from the global financial crisis has been slow and incomplete. In fact, Denmark’s 5.5 percent decline in real G.D.P. per capita since 2007 is comparable to the declines in debt-crisis countries like Portugal or Spain, even though Denmark has never lost the confidence of investors.

What explains this poor recent performance? The answer, mainly, is bad monetary and fiscal policy. Denmark hasn’t adopted the euro, but it manages its currency as if it had, which means that it has shared the consequences of monetary mistakes like the European Central Bank’s 2011 interest rate hike. And while the country has faced no market pressure to slash spending — Denmark can borrow long-term at an interest rate of only 0.84 percent — it has adopted fiscal austerity anyway.

The result is a sharp contrast with neighboring Sweden, which doesn’t shadow the euro (although it has made some mistakes on its own), hasn’t done much austerity, and has seen real G.D.P. per capita rise while Denmark’s falls.

But Denmark’s monetary and fiscal errors don’t say anything about the sustainability of a strong welfare state. In fact, people who denounce things like universal health coverage and subsidized child care tend also to be people who demand higher interest rates and spending cuts in a depressed economy. (Remember all the talk about “debasing” the dollar?) That is, U.S. conservatives actually approve of some Danish policies — but only the ones that have proved to be badly misguided.

So yes, we can learn a lot from Denmark, both its successes and its failures.

And let me say that it was both a pleasure and a relief to hear people who might become president talk seriously about how we can learn from the experience of other countries, as opposed to just chanting

“U.S.A.! U.S.A.! U.S.A.!”

http://www.nytimes.com/2015/10/19/opinion/something-not-rotten-in-denmark.html?ref=opinion

[DMX7]

It would be interesting to see how Bernie's plan would affect college endowments. Would fewer people give back to their school knowing that the government is going to pick up the tab for future students anyway? Part of the incentive to give is to make it more affordable for future generations and to establish scholarships that will attract better quality students for the university.

[boutons_deux]

It would be interesting to see how Bernie's plan would affect college endowments. Would fewer people give back to their school knowing that the government is going to pick up the tab for future students anyway? Part of the incentive to give is to make it more affordable for future generations and to establish scholarships that will attract better quality students for the university.

Individuals giving endowments are usually in the upper 10% or higher.

They negotiate, through their expensive tax lawyers/accountants, with the IRS about how much they can write off, so in fact TAXPAYERS are already contributing to (very often) wealthy private universities.

[Sportcamper]

I thought the SNL Democrat Debate was outstanding....Larry David as "The Bern" was hysterical...


https://www.youtube.com/watch?v=pfmwGAd1L-o

[DarrinS]

:lol Larry David. Spot on, tbh