Discussion:
Dameculo: The Price of Socialism
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FYATFHYRIO
2004-01-19 00:46:13 UTC
Permalink
Denmark: Potemkin Village

Denmark is often cited as an exemplary country within the EU, with an
economic system that others should seek to emulate. In the comparisons of
GDP per capita, Denmark ranks consistently in the top ten worldwide, and
often in the top five. Denamrk is a Time Bomb!



by Per Henrik Hansen

[Posted March 6, 2002]

In the 1700s, the courtesans of Queen Catherine of Russia gave her tours
along the Volga river where she witnessed a happy and thriving bourgeoisie
living in clean and prosperous villages. But this was all a show to cover
disease, poverty, and misery that lay just behind the facade that had been
erected for her benefit.

This is the origin of the phrase Potemkin Village, a place where a
politically generated appearance covers a less impressive underside.

Europe is today filled with Potemkin Villages, none as successful as
Denmark. Denmark is often cited as an exemplary country within the EU, with
an economic system that others should seek to emulate. In the comparisons of
GDP per capita, Denmark ranks consistently in the top ten worldwide, and
often in the top five.

Denmark's economic data for 2001 appear impressive:

Slow but balanced growth of 1.1 percent, down from 3.2 percent in 2000.
Denmark has had higher growth than many other EU countries since the
mid-1990s.
An inflation rate of 2.3 percent. The inflation rate has not been above 3
percent since 1994 and not above 4 percent at all in the 1990s.
The long-term interest rate (10-year) has shown a steady decline from a
level in 1990 of more than 10 per cent to today's of just around 5 percent.
The short-term interest rate (3-month) likewise has shown a steady and even
bigger decline over the period. From 12 per cent in 1990 to just around 3.5
percent today.
An unemployment rate that is relatively low and falling. The rate is now
officially 5.2 percent, down from 12.2 percent in 1993.
A budget surplus of 1.9 percent of GDP. It is the 5th year in a row that the
budget has been in surplus.
A fairly large surplus on the current account of 3.4 percent of GDP. Denmark
has had a surplus on the current account continuously in the 1990s, except
for 1998.
The Danish public debt as a percentage of the GDP has fallen for several
years and is now approximately 45 percent instead of close to 80 percent in
the early 1990s.
The Danish foreign public debt as a percentage of the GDP is also falling
and is now approximately 15 percent instead of almost 40 percent in the
early 1990s.
Denmark is the least corrupt country in the world according to surveys that
measure such things.
Denmark also claims to have a population with a very robust work ethic,
which is probably true. All of this looks very good, at least on the
surface.
But let us look at some other economic statistics that are not mentioned
nearly as often.

Denmark has an entire population of 5,350,000 people. Of them, 1,150,000 are
below 18 years old. Of the remaining 4,200,000 people, 2,214,000 people
receive government transfer payments (not counting 260,000 students that
receive public scholarships of $550 per month).

When you recalculate these 2,214,000 people, of whom some receive only
part-time government transfers, into people who live full-time on transfer
income, the total becomes 1,590,000 people living off transfer payments.

Out of these 1,590,000 people, 710,000 are pensioners and the remaining
approximately 900,000 are working-age people. Most of them cannot be found
in the unemployment statistics. They are on other kinds of public transfer
programs of which there exist ten different types.

There are approximately 1,900,000 people working in the private sector and
840,000 working in the public sector or publicly owned companies. (The
reason the numbers do not add up to 4.2 million is because not all are full
time workers.)

We can conclude from this that of the people in the working age of 18 to 66,
more than one quarter live passively on government transfers (full time).
For every 100 persons employed full time in 1999, there were 33 working-age
people receiving support. Adding pensioners, the total number was 61 people
on full time transfer income for each 100 full time employed persons. (The
pensioners are financed by a pay-as-you-go pension scheme). And out of those
who are employed, 31.5 percent work for the government.

All of this, of course, needs to be financed. Denmark has therefore for many
years had a very high and continuously increasing tax level.

In 2002, the lowest marginal income tax level is 44.31 percent, then it
increases to 49.77 percent and 63.33 percent. Forty percent of the working
people pay the top marginal tax rate of 63.33 percent, which applies to all
income over $33,000.

There are very few tax deductions available, and the tax value of the tax
deductions is continuously being reduced.

A sales tax of 25 percent hits just about everything.

The capital gains tax is 59.7 percent for a private person in the high
income tax bracket, unless you hold your investment for more than 3 years.
It then falls to 44.8 percent.

There are additional taxes on "sinful" and "luxury" products likes
cigarettes, alcohol, candy, soft drinks, electronic goods, and other
luxuries.

For cars, there is a 180 percent special tax on top of the sales tax of 25
percent. Then there is a registration fee and a weight fee to be paid twice
per year for the privilege of using the roads. The price of gasoline is
nearly three times as high as it is in the US.

Denmark imposes many new green taxes. These are the taxes that have
increased most substantially during the 1990s. These taxes hit heating,
electricity, water, and gasoline.

Real estate, which is already heavily taxed, has been the target of new
taxes throughout the 1990s. In addition, the tax value of deductions have
been continuously reduced.

With Denmark, as with all of Europe, your perception of its economic status
depends on which statistics you are looking at. Also, your judgement of its
economic status depends on your preferences (is stability alone to be
valued, or is freedom also important?) and your time horizon (does it matter
that all these taxes make Denmark far less prosperous than it otherwise
would be?).

Danish politicians proudly proclaims that Denmark is the most egalitarian
country in the world. They may be right. The obsession with equality
delivers a crushing, daily blow to anyone with a new idea or the inkling to
cultivate an ability that surpasses the norm. Young people have virtually no
chance to improve their lot in life, to take risks, to make it big through
innovation and entrepreneurship.

Excellent and hard work are not rewarded by a system that systematically
levels the population into a huge homogenous middle class, whose standard of
living advances only incrementally and in ways that flout economic
priorities. A total tax level that approaches 70 percent is a relentless and
debilitating reminder that this country desires no personal economic
achievement and no accumulation of wealth.

And yet many people seem to be happy with this system, somewhat like the
masses of Huxley's Brave New World. Of course it sets up a dynamic that
harms everyone in the long run, but people don't seem to understand or care
about this. Equality and stability are regarded as more important than
progress and freedom.

A heritage of honesty and hard work are marvelous tools for papering over
the failures of welfarism and subtle servitude. With the right attitude,
even a prison population can settle into a comfortable and egalitarian
existence, one that might even impress Queen Catherine passing by on a boat.
But lacking energy, enterprise, entrepreneurship, and freedom, such systems
of economic control exact a huge toll with the passage of time.


----------------------------------------------------------------------------
----

Per Henrik Hansen works at Danmarks Nationalbank and teaches economics at
the Copenhagen Business School. Send him MAIL.
Damocles
2004-01-19 16:25:32 UTC
Permalink
Solo un PNP bruto se le ocurre anotar algo en este foro sin investigar
su procedencia. Primero, el hecho de que aparezca en el internet no
significa que es precisa y/o correcta la informacion. Segundo, asegurate
que cuando alguien escriba sobre algun tema o disciplina, investiga si
tiene algun trasfondo para hacerlo. Si el tipo es un experto en
literatura clasica, lee con mucha cautela cuando escriba sobre economia.
O si es un economista experto en microeconomia, lee con un sedazo lo que
escriba sobre macroeconomia. Este joven es una "Phd Candidate" o sea es
un estudiante doctoral igual que el pendejo ese que botamos de este foro
que nunca se graduo. Su area de estudio son los ciclos economicos por lo
cual este articulo o que hace es criticar desde una perspectiva
derechista y neoliberal el modelo economico de su pais. Su ideologia lo
ciega a la cantidad de evidencia empirica que tiene ante los ojos. Por
eso despacha, deforma irresponsable todo los datos que evidencian,
claramente, lo egalitario, justo y progresista que es su pais comparado
a gringolandia.

Lee quien es el joven:


http://www.cbs.dk/departments/econ/folder.pdf

Este es el analisis de la Agencia Central de Inteligencia:

"NET EXPORTER OF FOOD"
"comfortable balance of payments surplus"
Bajo desempleo, y baja la tasa de inflacion.

CIA

Economy - overview:

This thoroughly modern market economy features high-tech agriculture,
up-to-date small-scale and corporate industry, extensive government
welfare measures, comfortable living standards, a stable currency, and
high dependence on foreign trade. Denmark is a net exporter of food and
energy and enjoys a comfortable balance of payments surplus. Government
objectives include streamlining the bureaucracy and further
privatization of state assets. The government has been successful in
meeting, and even exceeding, the economic convergence criteria for
participating in the third phase (a common European currency) of the
European Economic and Monetary Union (EMU), but Denmark has decided not
to join the 12 other EU members in the euro; even so, the Danish Krone
remains pegged to the euro. Given the sluggish state of the European
economy, growth in 2003 was a mere 1.1%.


Todos los dias se tira unpendejo vruto a la calle, en terminos de
probabilidades, 99% de las veces es un PNP Vruto (oxymoron?).
Post by FYATFHYRIO
Denmark: Potemkin Village
Denmark is often cited as an exemplary country within the EU, with an
economic system that others should seek to emulate. In the comparisons of
GDP per capita, Denmark ranks consistently in the top ten worldwide, and
often in the top five. Denamrk is a Time Bomb!
by Per Henrik Hansen
[Posted March 6, 2002]
In the 1700s, the courtesans of Queen Catherine of Russia gave her tours
along the Volga river where she witnessed a happy and thriving bourgeoisie
living in clean and prosperous villages. But this was all a show to cover
disease, poverty, and misery that lay just behind the facade that had been
erected for her benefit.
This is the origin of the phrase Potemkin Village, a place where a
politically generated appearance covers a less impressive underside.
Europe is today filled with Potemkin Villages, none as successful as
Denmark. Denmark is often cited as an exemplary country within the EU, with
an economic system that others should seek to emulate. In the comparisons of
GDP per capita, Denmark ranks consistently in the top ten worldwide, and
often in the top five.
Slow but balanced growth of 1.1 percent, down from 3.2 percent in 2000.
Denmark has had higher growth than many other EU countries since the
mid-1990s.
An inflation rate of 2.3 percent. The inflation rate has not been above 3
percent since 1994 and not above 4 percent at all in the 1990s.
The long-term interest rate (10-year) has shown a steady decline from a
level in 1990 of more than 10 per cent to today's of just around 5 percent.
The short-term interest rate (3-month) likewise has shown a steady and even
bigger decline over the period. From 12 per cent in 1990 to just around 3.5
percent today.
An unemployment rate that is relatively low and falling. The rate is now
officially 5.2 percent, down from 12.2 percent in 1993.
A budget surplus of 1.9 percent of GDP. It is the 5th year in a row that the
budget has been in surplus.
A fairly large surplus on the current account of 3.4 percent of GDP. Denmark
has had a surplus on the current account continuously in the 1990s, except
for 1998.
The Danish public debt as a percentage of the GDP has fallen for several
years and is now approximately 45 percent instead of close to 80 percent in
the early 1990s.
The Danish foreign public debt as a percentage of the GDP is also falling
and is now approximately 15 percent instead of almost 40 percent in the
early 1990s.
Denmark is the least corrupt country in the world according to surveys that
measure such things.
Denmark also claims to have a population with a very robust work ethic,
which is probably true. All of this looks very good, at least on the
surface.
But let us look at some other economic statistics that are not mentioned
nearly as often.
Denmark has an entire population of 5,350,000 people. Of them, 1,150,000 are
below 18 years old. Of the remaining 4,200,000 people, 2,214,000 people
receive government transfer payments (not counting 260,000 students that
receive public scholarships of $550 per month).
When you recalculate these 2,214,000 people, of whom some receive only
part-time government transfers, into people who live full-time on transfer
income, the total becomes 1,590,000 people living off transfer payments.
Out of these 1,590,000 people, 710,000 are pensioners and the remaining
approximately 900,000 are working-age people. Most of them cannot be found
in the unemployment statistics. They are on other kinds of public transfer
programs of which there exist ten different types.
There are approximately 1,900,000 people working in the private sector and
840,000 working in the public sector or publicly owned companies. (The
reason the numbers do not add up to 4.2 million is because not all are full
time workers.)
We can conclude from this that of the people in the working age of 18 to 66,
more than one quarter live passively on government transfers (full time).
For every 100 persons employed full time in 1999, there were 33 working-age
people receiving support. Adding pensioners, the total number was 61 people
on full time transfer income for each 100 full time employed persons. (The
pensioners are financed by a pay-as-you-go pension scheme). And out of those
who are employed, 31.5 percent work for the government.
All of this, of course, needs to be financed. Denmark has therefore for many
years had a very high and continuously increasing tax level.
In 2002, the lowest marginal income tax level is 44.31 percent, then it
increases to 49.77 percent and 63.33 percent. Forty percent of the working
people pay the top marginal tax rate of 63.33 percent, which applies to all
income over $33,000.
There are very few tax deductions available, and the tax value of the tax
deductions is continuously being reduced.
A sales tax of 25 percent hits just about everything.
The capital gains tax is 59.7 percent for a private person in the high
income tax bracket, unless you hold your investment for more than 3 years.
It then falls to 44.8 percent.
There are additional taxes on "sinful" and "luxury" products likes
cigarettes, alcohol, candy, soft drinks, electronic goods, and other
luxuries.
For cars, there is a 180 percent special tax on top of the sales tax of 25
percent. Then there is a registration fee and a weight fee to be paid twice
per year for the privilege of using the roads. The price of gasoline is
nearly three times as high as it is in the US.
Denmark imposes many new green taxes. These are the taxes that have
increased most substantially during the 1990s. These taxes hit heating,
electricity, water, and gasoline.
Real estate, which is already heavily taxed, has been the target of new
taxes throughout the 1990s. In addition, the tax value of deductions have
been continuously reduced.
With Denmark, as with all of Europe, your perception of its economic status
depends on which statistics you are looking at. Also, your judgement of its
economic status depends on your preferences (is stability alone to be
valued, or is freedom also important?) and your time horizon (does it matter
that all these taxes make Denmark far less prosperous than it otherwise
would be?).
Danish politicians proudly proclaims that Denmark is the most egalitarian
country in the world. They may be right. The obsession with equality
delivers a crushing, daily blow to anyone with a new idea or the inkling to
cultivate an ability that surpasses the norm. Young people have virtually no
chance to improve their lot in life, to take risks, to make it big through
innovation and entrepreneurship.
Excellent and hard work are not rewarded by a system that systematically
levels the population into a huge homogenous middle class, whose standard of
living advances only incrementally and in ways that flout economic
priorities. A total tax level that approaches 70 percent is a relentless and
debilitating reminder that this country desires no personal economic
achievement and no accumulation of wealth.
And yet many people seem to be happy with this system, somewhat like the
masses of Huxley's Brave New World. Of course it sets up a dynamic that
harms everyone in the long run, but people don't seem to understand or care
about this. Equality and stability are regarded as more important than
progress and freedom.
A heritage of honesty and hard work are marvelous tools for papering over
the failures of welfarism and subtle servitude. With the right attitude,
even a prison population can settle into a comfortable and egalitarian
existence, one that might even impress Queen Catherine passing by on a boat.
But lacking energy, enterprise, entrepreneurship, and freedom, such systems
of economic control exact a huge toll with the passage of time.
----------------------------------------------------------------------------
----
Per Henrik Hansen works at Danmarks Nationalbank and teaches economics at
the Copenhagen Business School. Send him MAIL.
FYATFHYRIO
2004-01-19 17:40:46 UTC
Permalink
Danish politicians proudly proclaims that Denmark is the most egalitarian
country in the world. They may be right. The obsession with equality
delivers a crushing, daily blow to anyone with a new idea or the inkling to
cultivate an ability that surpasses the norm. Young people have virtually no
chance to improve their lot in life, to take risks, to make it big through
innovation and entrepreneurship.

Excellent and hard work are not rewarded by a system that systematically
levels the population into a huge homogenous middle class, whose standard of
living advances only incrementally and in ways that flout economic
priorities. A total tax level that approaches 70 percent is a relentless and
debilitating reminder that this country desires no personal economic
achievement and no accumulation of wealth.


"
Damocles
2004-01-19 17:51:55 UTC
Permalink
Post by FYATFHYRIO
Danish politicians proudly proclaims that Denmark is the most egalitarian
country in the world. They may be right. The obsession with equality
delivers a crushing, daily blow to anyone with a new idea or the inkling to
cultivate an ability that surpasses the norm. Young people have virtually no
chance to improve their lot in life, to take risks, to make it big through
innovation and entrepreneurship.
At least give credit to the source you nimwit!
Post by FYATFHYRIO
Excellent and hard work are not rewarded by a system that systematically
levels the population into a huge homogenous middle class, whose standard of
living advances only incrementally and in ways that flout economic
priorities. A total tax level that approaches 70 percent is a relentless and
debilitating reminder that this country desires no personal economic
achievement and no accumulation of wealth.
I guess having a low crime rate is unimportant? Danes appreciate being
able to walk down the street at night without having to carry a UZI like
in Puerto Rico or Washington DC.
Post by FYATFHYRIO
"
FYATFHYRIO
2004-01-19 22:16:21 UTC
Permalink
DameCULO:

Nimwit? What the f*ck is that? I know you are dimwit, but a nimwit? Making
up new terms, are you? What is a nimwit dumbo? Something your students
call you behind your back? Maybe you mean you are a nitwit, is that
correct? You may have been a refugee here in the states for 30 years, but
you have along way to go before you master the tongue of your masters.
Post by Damocles
Post by FYATFHYRIO
Danish politicians proudly proclaims that Denmark is the most egalitarian
country in the world. They may be right. The obsession with equality
delivers a crushing, daily blow to anyone with a new idea or the inkling to
cultivate an ability that surpasses the norm. Young people have virtually no
chance to improve their lot in life, to take risks, to make it big through
innovation and entrepreneurship.
At least give credit to the source you nimwit!
Post by FYATFHYRIO
Excellent and hard work are not rewarded by a system that systematically
levels the population into a huge homogenous middle class, whose standard of
living advances only incrementally and in ways that flout economic
priorities. A total tax level that approaches 70 percent is a relentless and
debilitating reminder that this country desires no personal economic
achievement and no accumulation of wealth.
I guess having a low crime rate is unimportant? Danes appreciate being
able to walk down the street at night without having to carry a UZI like
in Puerto Rico or Washington DC.
Post by FYATFHYRIO
"
John Doe
2004-01-19 23:38:34 UTC
Permalink
In article <UGYOb.101189$***@attbi_s01>, ***@gasthaus.com
says...
Post by FYATFHYRIO
Nimwit? What the f*ck is that? I know you are dimwit, but a nimwit? Making
up new terms, are you? What is a nimwit dumbo? Something your students
call you behind your back? Maybe you mean you are a nitwit, is that
correct? You may have been a refugee here in the states for 30 years, but
you have along way to go before you master the tongue of your masters.
His Spanish is no better. He writes like a twelve year old, but he behaves
like he is five, so that makes Victurd feel that he is advanced.

John

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