Column: The math of social democracy

Scandinavian countries aren’t socialist, they are social democracies, and there is a huge difference. Calling it socialist is a scare tactic that helps the rich hold power over the middle class.

Democratic presidential candidate Bernie Sanders is visiting our campus tomorrow, and I would like to personally bid him welcome. As an exchange student from Denmark, it is always heartwarming to hear Senator Sanders speak so kindly about my home country. To be honest, every time anyone in the States indicates that they know we exist, nearly all six million Danes collectively lose their minds. 

Yet, that is not the only reason that Sanders is probably the candidate that most Scandinavian citizens prefer. The American political discourse is oddly fascinating to us because we struggle to understand why you insist that corporations, and not the government, should be providing basic necessities, like healthcare and education, to your population. Sanders is, to my knowledge, the first presidential candidate who suggested that maybe that should change.

In contrast, all Danish parties across the political spectrum agree that our extensive welfare state is a good thing and should be preserved. They only disagree on how best to do it, which is pretty impressive considering that we currently have ten parties elected (not including the ones from Greenland — we are still not selling).

Our welfare state will provide an unemployed and homeless Dane with a basic income, a home and medical care if needed. All this, of course, requires a high tax rate. Nonetheless, that does not make Denmark a socialist country. There are tons of privately-owned businesses in the country, and the government does not have control over the economy. In fact, Denmark scores higher than the U.S. on a number of economic freedom measures. We simply choose to redistribute our wealth among the population a lot more than you do. A country with a capitalist economy and a strong welfare state is called a social democracy — not a socialist regime.

This column is meant to be a crash-course in "How to Become Happy 101." It is not supposed to sound like I’m attacking America or being patronizing to its citizens. My heart just truly breaks whenever I see social inequity, which could be fixed with relative ease. Right now, the American system is structured in a way that helps a few rich people become richer, which I honestly think is undemocratic.

The American Revolution's slogan was: “Taxation without representation is tyranny.” Why does this statement not apply to modern America? In a society with a strong welfare state, you elect the people in charge of your health and education. If they are not good enough, you can kick them out of office. You can’t fire the insurance people. You can switch providers, but let’s be honest, that won’t have a big effect on the company.

Please call me a communist, if that gets it out of your system, but I want you to listen to my arguments. And yes, I am the same writer who wrote about the conservative center last week. I will defend your right to have and express your opinion any day, so please allow me to do the same. 

I argue that letting the government take over some aspects of your economy will make paying for it cheaper from a consumer standpoint.

Let’s take a look at the math.

The average annual income for one person in the United States in late 2018 was $62,850. If that American were living in Chapel Hill, he or she would receive $47,941 out of their income under current tax laws, which is an effective tax rate of 23.72 percent. The average Dane has an annual income of $60,140. That average taxpayer would get $38,906 of that, which is an effective tax rate of 35.1 percent.

For a Danish citizen, included in those taxes are free healthcare and free higher education among other things. The American citizen on the other hand has to pay an additional amount out of pocket to get that.

Tuition and fees for one child for four years at an in-state public college, without scholarships, would require a parent to save up $3000 annually from birth until enrollment. The average health insurance policy, according to health insurer eHealth, under the Affordable Care Act costs $5,280 annually, which often also has a deductible. That leaves the average American taxpayer with $39,661 left a year, which would be equal to a tax rate of 36.9 percent.

There are, of course, other taxes apart from income tax. The sales tax on all goods in Denmark is 25 percent, and the corporate tax is 22 percent. Yet the average Dane can afford almost as many goods as the average American, even though the former has a higher taxation rate. That is because the Danish Purchasing Power Parity is only a bit smaller than the American, which means that you can nearly buy the same amount of products in both countries for the same dollar.

This comparison is not even including the fact that the welfare state provides many other social benefits. Of course, some freeloading people will take advantage of the system, but in my opinion, the benefits outweigh that risk. Besides, Denmark currently has an unemployment rate of 3.8 percent, so it is not that big of a problem anyway.

The conservatives in this country are running a scare campaign about how horrible the United States would become if you adopted some of the "socialist" Scandinavian policies. Why do you think that we score so high on the Happiness Report year after year? 

Now look, this is not going to happen over night. It took us about 100 years to get to where we are now, and Denmark is just a small country of almost six million people. But the good news is that you guys are much farther ahead than we were when we started, and you have a couple of countries that you can imitate. So drop the excuses and work towards that utopia you dream of. Don’t run your politics on what you cannot do, run it on what you can.

So, dear UNC students and staff, please think about what kind of a society you want in the future. Perhaps you should go listen to Bernie Sanders speak while he is on campus. Maybe electing a social democrat is not such a bad idea. It just makes so much more sense from a sympathetic, economic and mathematical standpoint.

opinion@dailytarheel.com