Atlas in High-Taxed Denmark

Liz's picture
Submitted by Liz on Thu, 2007-12-06 06:35.

"Denmark is the home of "flexicurity," the catchy name given to a system that pays ample unemployment and welfare benefits but, unusually in Europe, imposes almost no restrictions on hiring and firing by employers. The mixture has served Denmark well, and its economy barreled ahead in 2006 by 3.5 percent, one of the best performances in western Europe. The country is effectively at full employment.

But success has given rise to an anxious search for talent among Danish companies, and focused attention on émigrés like Sorensen. The Organization for Economic Cooperation and Development, which is based in Paris, projects that Denmark's growth rate will fall to an annual rate of slightly more than 1 percent for the five years beginning in 2009, reflecting a dwindling supply of a vital input for any economy: labor.

The problem, employers and economists believe, has a lot to do with the 63 percent marginal tax rate paid by top earners in Denmark - a level that hits anyone making more than 360,000 Danish kroner, or about $70,000. That same tax rate underpins such effective income redistribution that Denmark is the most nearly equal society in the world, in that wealth is more evenly spread than anywhere else.

The movement toward lower taxes passed Denmark by, even as it took root in much of Europe."

"Danish business normally keeps its distance from politics, but in parliamentary elections this year, a few companies jumped into the fray.

Lars Christensen is co-chief executive of Saxo Bank, a Copenhagen financial services firm specializing in currency trading and retail brokerage services. New employees at Saxo Bank get a copy of "Winning," the playbook of Jack Welch, the brass-knuckled former chief executive of General Electric, and "Atlas Shrugged," the libertarian manifesto by Ayn Rand, suggesting that the boss has little time for solutions that beat around the bush."

High Income Taxes in Denmark Worsen a Labor Shortage


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Oh Ross

Sandi's picture

I just bet you licked the cream with your fingers (without washing them first).


I had...

Ross Elliot's picture

...a strawberry Danish the other day.


Danish women are HOT

atlascott's picture

Danish guys? Eh, not so hot. But the Danish lasses? incomparable. Other than NZ'ers, of course.

Scott DeSalvo

Quidquid latine dictum sit, altum viditur!


I think that Danes

Sandi's picture

Are the most physically beautiful, attractive, stunning, drop dead gorgeous, mouth open and catching flies - breathtaking race of people.


Gosh

Elijah Lineberry's picture

everything that could be wrong with a society...is wrong in Denmark!

High taxes, egalitarianism, welfare state..gosh

Must be a dreadful place for a chap to reside...why do so many put up with it?

"I create nothing. I own"


It will be interesting to

Mark Hubbard's picture

 

It will be interesting to see how all this plays out. Sixty three percent tax rates: frightening. They - their politicians - have rather shrewdly played this by the no restrictions on hiring and firing (I wish it were so Down Under), which has no doubt been helped by their neighbours, such as France, who are the opposite, but ultimately, no one is long term going to take the punishment of sixty three percent.

 

The market will always out in the end.

 

(Not too good at line breaks, this upgrade.)


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