Monday, November 12, 2007

Why are Socialist countries like Denmark so apparently rich?

A lot of people, usually academic economists and fans of socialism who've never actually lived in Denmark make the Nordic model out to be some great utopian society, but they forget two things:-

1) The Scandinavian countries are all very rich in natural resources, even if it is often claimed otherwise. Denmark and Norway are, per capita, two of the world's biggest oil producers. Iceland and Denmark (esp. through Greenland) are two of the biggest seafood producers, then finally Sweden and Finland are so full of trees they supply much of the timber and pulp paper throughout Europe. Without these assets, these countries would run massive trade deficits and be unable to afford their generous welfare state.

2) These countries have successfully monetised many aspects of private family life that was previously outside the scope of inclusion in official economic figures like GDP. Take childcare and elderly care, for example, in Denmark, you'll often find 2 women work as childcarers, and as part of the system they drop their own children off with other childcarers! It's the same as paying someone to paint your house while you pay them to paint yours. A no-brainer for government, since it's more tax-collection opportunities, but bad news for individuals.

Can anyone even put a cost of the long-term social damage it does to families? Funnily enough, Danes are reknowned as "serial mongamists", IE drifting from one relationship to another, collecting kids from various relationships and partners along the way. You almost feel weird here if you keep the same partner for more than 5-7 years (the old 7 year itch, eh?)

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