| In light of the political campaigns in the United States of America, Paul Krugman has lately been voicing his own opinions about certain aspects of the campaign (what columnist wouldn’t want to write about it?). Not surprisingly, those opinions challenge or- though not often- agree with certain economic policies that candidates discuss or inherently value, absolutely destroying further argument in the process. I, personally, agree with many of the arguments Krugman has offered, as there is substantial evidence backing him up and my own experience and perspective (as of now) verifies his viewpoint. That said, I am not Krugman, and I do let my eyes scan everywhere (even drift away from the column) for incoming rhetoric. The implications of the topics Krugman writes about are at times interesting and does spur discussion. |
In this particular case, in “Something Not Rotten in Denmark,” from the New York Times website, Krugman reflects on points made about Denmark’s economy during the first Democratic Debate. During the debate, Bernie Sanders appraised the country’s working incentive. Hillary Clinton, however, sustained that “we are not Denmark” and then somewhat ironically proceeded to agree with Sanders. Krugman, naturally, had a lot to say on this topic.
First and foremost, Krugman appraised the country. The country provides “universal health care. . . college education. . . and subsidized day care” and pays for it with a top income tax rate of 60 percent without losing its incentive for jobs and maintaining a low suicide rate. Denmark is like a fantasy for Krugman as he, a liberal, can see a point at which conservative economic principles don’t hold true.
Now, the column doesn’t only represent that good side of Denmark. It also represents Denmark’s approval of Krugman’s arch-nemesis, bad fiscal policy and too many austerity measures. These policies, like many illegal drugs, do probably work without negative effects in small, sporadic doses. For that reason, and not because of illegal drugs, Denmark has seen a decline in its GDP.
This post calls many ideas to question. Are the Nordic countries the only place where such economic policies could prosper? Would large amounts of tax revenue work in other countries without losing job incentive? How could Denmark strengths and the Nordic Model aid other countries around the globe? Will this Denmark welfare last? From the demographics of Denmark, I can see that the Denmark system can last as long as the global market continues to increase because Denmark relies on “maritime shipping and renewable energy.” Job incentive stays in Denmark because people still invest in it, allowing cash to flow into industry. If austerity measures increase, reason for investment will fall, damaging the economy. Also, it seems as though these types of policies could endure travel into foreign nations if and only if either government investment was placed in a wealthy pool of natural resources like in Qatar or if income tax rates were increased enormously, like in Denmark.
On the issue of welfare policies in countries, it seems to me as if they are dependent on the geography and the demographics of the nation as well as the sources of income, the time period, and the views of its major political organizations. All in all, situations are never unilateral and are always infinitely complex- a summation of constants and ever-changing variables. From experience trying to synchronize my mind with other people, people never agree fully on almost all topics, as in the case of the divide and disagreement of the two dominating current political philosophies, conservatism and liberalism, that employ different economic strategies. It is the understanding and acceptance of that truth that we may decisively employ economic strategies that promote the general welfare and economic prosperity.
-Praveen
Krugman, Paul. "Something Not Rotten in Denmark." The New York Times. The New York Times, 18 Oct. 2015. Web. 25 Oct. 2015.
"Table I.7. Top Statutory Personal Income Tax Rate and Top Marginal Tax Rates for Employees." Table I.7. Top Statutory Personal Income Tax Rate and Top Marginal Tax Rates for Employees. Web. 25 Oct. 2015.
"Suicide Data." WHO. 2015. Web. 25 Oct. 2015.
Andersen, Torben. "The Nordic Model." MIT. Taloustieto Oy, 4 Dec. 2007. Web. 25 Oct. 2015.
"Denmark." Central Intelligence Agency. Central Intelligence Agency, 14 Oct. 2015. Web. 25 Oct. 2015.
First and foremost, Krugman appraised the country. The country provides “universal health care. . . college education. . . and subsidized day care” and pays for it with a top income tax rate of 60 percent without losing its incentive for jobs and maintaining a low suicide rate. Denmark is like a fantasy for Krugman as he, a liberal, can see a point at which conservative economic principles don’t hold true.
Now, the column doesn’t only represent that good side of Denmark. It also represents Denmark’s approval of Krugman’s arch-nemesis, bad fiscal policy and too many austerity measures. These policies, like many illegal drugs, do probably work without negative effects in small, sporadic doses. For that reason, and not because of illegal drugs, Denmark has seen a decline in its GDP.
This post calls many ideas to question. Are the Nordic countries the only place where such economic policies could prosper? Would large amounts of tax revenue work in other countries without losing job incentive? How could Denmark strengths and the Nordic Model aid other countries around the globe? Will this Denmark welfare last? From the demographics of Denmark, I can see that the Denmark system can last as long as the global market continues to increase because Denmark relies on “maritime shipping and renewable energy.” Job incentive stays in Denmark because people still invest in it, allowing cash to flow into industry. If austerity measures increase, reason for investment will fall, damaging the economy. Also, it seems as though these types of policies could endure travel into foreign nations if and only if either government investment was placed in a wealthy pool of natural resources like in Qatar or if income tax rates were increased enormously, like in Denmark.
On the issue of welfare policies in countries, it seems to me as if they are dependent on the geography and the demographics of the nation as well as the sources of income, the time period, and the views of its major political organizations. All in all, situations are never unilateral and are always infinitely complex- a summation of constants and ever-changing variables. From experience trying to synchronize my mind with other people, people never agree fully on almost all topics, as in the case of the divide and disagreement of the two dominating current political philosophies, conservatism and liberalism, that employ different economic strategies. It is the understanding and acceptance of that truth that we may decisively employ economic strategies that promote the general welfare and economic prosperity.
-Praveen
Krugman, Paul. "Something Not Rotten in Denmark." The New York Times. The New York Times, 18 Oct. 2015. Web. 25 Oct. 2015.
"Table I.7. Top Statutory Personal Income Tax Rate and Top Marginal Tax Rates for Employees." Table I.7. Top Statutory Personal Income Tax Rate and Top Marginal Tax Rates for Employees. Web. 25 Oct. 2015.
"Suicide Data." WHO. 2015. Web. 25 Oct. 2015.
Andersen, Torben. "The Nordic Model." MIT. Taloustieto Oy, 4 Dec. 2007. Web. 25 Oct. 2015.
"Denmark." Central Intelligence Agency. Central Intelligence Agency, 14 Oct. 2015. Web. 25 Oct. 2015.