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Nothing is Rotten in Denmark

By Shlomo Maital

Little Mermaid Copenhagen: The Little Mermaid

   Shakespeare’s famous line, “something is rotten in the state of Denmark”, from Hamlet, needs amendment. These days, very little is rotten there, and other countries can learn much from it. But are they?   Paul Krugman’s latest New York Times column doubts it.

   What is Denmark’s story? It is a welfare state with enormous social benefits, that takes care of its children, homeless, ill people, and others.   It pays for it with heavy taxes, also on the wealthy, but at the same time maintains a vibrant economy. Here is how Krugman, a Nobel Laureate in Economics, decribes it:

   Denmark maintains a welfare state — a set of government programs designed to provide economic security — that is beyond the wildest dreams of American liberals. Denmark provides universal health care; college education is free, and students receive a stipend; day care is heavily subsidized. Overall, working-age families receive more than three times as much aid, as a share of G.D.P., as their U.S. counterparts. To pay for these programs, Denmark collects a lot of taxes. The top income tax rate is 60.3 percent; there’s also a 25 percent national sales tax. Overall, Denmark’s tax take is almost half of national income, compared with 25 percent in the United States. Describe these policies to any American conservative, and he would predict ruin. Surely those generous benefits must destroy the incentive to work, while those high taxes drive job creators into hiding or exile. Strange to say, however, Denmark doesn’t look like a set from “Mad Max.” On the contrary, it’s a prosperous nation that does quite well on job creation. In fact, adults in their prime working years are substantially more likely to be employed in Denmark than they are in America. Labor productivity in Denmark is roughly the same as it is here, although G.D.P. per capita is lower, mainly because the Danes take a lot more vacation.   Nor are the Danes melancholy: Denmark ranks at or near the top on international comparisons of “life satisfaction.”

 

   How many times does this have to be said? A nation CAN take care of its people – its unemployed, jobless, skill-less, college students, children, sick, mentally ill – while paying for it through taxes (not deficits), and maintain a happy growing economy. The rich? They will pay taxes and not change their behavior on jot.   There is no reason for any political system to pander to the rich, even though they use their funds to buy political influence.

   Nothing is rotten in Denmark. Is anybody watching and listening?   American conservatives? The last word goes to Krugman:

   It’s hard to imagine a better refutation of anti-tax, anti-government economic doctrine, which insists that a system like Denmark’s would be completely unworkable.

 

 

 

 

 

 

 Story-Driven Policy: Worth a Try!

By Shlomo  Maital

Kevin and Nicholas

Nicholas Kristof and friend Kevin Green, Yamhill

  The latest buzzword in professional and academic circles is “evidence-based”.  As an adjective, it modifies ‘psychology’,  ‘medical care’,  ‘policy’… everything.  Everything has to be evidence based. That usually implies a large data base mined for correlations.   Problem with that is,  G-d is in the details.  Truth is in the details.  By using data, especially Big Data, we miss the stories about the “little” people… forgotten people who struggle daily with illness, poverty, crime, drugs and other afflictions.  The Talmud says, If you save a single soul, it is as if you saved the whole world.  The point, of course, is to treat every single person with huge respect and massive importance.

    Today’s New York Times has two seemingly-unrelated stories that make this point perfectly.

    In his Op-Ed piece,  Nicholas Kristof mourns  the death of his school chum Kevin Green. They grew up together in Yamhill, Oregon, and ran cross-country together.  Kevin lost a good job, went on welfare, got divorced, became obese, lived on food stamps, got diabetes, and died at age 54.  Tea Party Republicans say he “had it easy because he got government benefits without doing anything”.  Kristof notes that Kevin collected cans and bottles by the roadside, to make $20 a day for subsistence.  Easy?  Want to trade places?  Did Republican wealth “trickle down” to Kevin and help him get a good job?  Not a chance.

    In Binyamin Applebaum’s piece on Washington, “Three stories illustrate Fed’s power and its limits”,  he covers Janet Yellen (Fed Chair) and her first speech.  Instead of an academic bore, quoting data, citing equations and analysis,   Yellen, who is brilliant, told the stories of three Chicago residents struggling to recover from the recession. She used their stories to explain why she will be very very slow and cautious in ending the Fed’s low-interest policy, despite Republican pressure to do so.   I wonder if she chose Chicago, because that is where President Obama lived and worked.

     All three ‘heroes’ in Yellen’s speech are struggling, but gaining ground.  Jermain Brownlee, 40, got a job building bus seats, though he makes less than he once did in construction.  Dorine Poole lost her job, then got a new one as a full-time office manager.  She makes $20,000 a year,  far less than the $32,000 she once made before the recession, as a claims processor.  Vicki Lara, 62,  lost her job in the recession and a year later, is serving food samples in a supermarket two days a week, six hours a day.  She wishes she could work more hours.  She owed $1,200 when she lost her job, and that debt has now ballooned to $3,700, with interest.  If she worked more, the companies to whom she owes money would simply garnish her wages.  So she had to decline a full-time job.   She told the NYT,  “When I walk home to catch the bus, I see five homeless people freezing in this weather…I wish I made enough money to help them.”

     Lots of people do make enough money to help them. But if you believe it’s their own fault, why bother?  Surely, they LOVE being homeless, outside, in the freezing cold.  Who wouldn’t? 

     I would like to see story-based policy.  If you want to cut welfare as a policy,  tell me a story about a real person and real events, to back up what you claim.    When I was a professor, I wrote papers based on data.  I always felt that the REAL story was in the story itself. But when I told stories, my papers were rejected, often with biting comments – because in Academe, “story” is a swear word.  Single cases, it is claimed, prove nothing.

    Wrong.  They prove everything.  They help us understand real people, real events, real problems.  When the U.S. Congress is populated by elected representatives, half of whom are millionaires, how in the world can they understand people like kevin, Vicki, Jerome or Dorine?    They can’t.      

    Why Tea-Party Individualism Has a Basic Flaw

By Shlomo  Maital

 evolution

The extreme right-wing of the Republican Party, known as the Tea Party, demands maximum  individual libertarian freedoms, lower taxes, less government, less or no social welfare.   It is named after the Boston Tea Party, which initiated the American Revolution when Bostoners refused to pay taxes levied by the British on imported tea, and dumped tea overboard.  But Tea Party is no party.  It has disrupted American politics, divided the Republican Party and elected substantial numbers of House members and Senators.   

    The best refutation I’ve found of the Tea Party ideology comes not from an economist or political scientist, but from an anthropologist named John Terrell, the Regenstein Curator of Pacific Anthropology at the Field Museum of Natural History and professor of anthropology at the University of Illinois in Chicago.   His basic argument, presented in an Op-Ed in the New York Times: 

    “The basic unit of human social life is not and never has been the selfish and self-serving individual.    Philosophers from Aristotle to Hegel have emphasized that human beings are essentially social creatures, that the idea of an isolated individual is a misleading abstraction. So it is not just ironic but instructive that modern evolutionary research, anthropology, cognitive psychology and neuroscience have come down on the side of the philosophers who have argued that the basic unit of human social life is not and never has been the selfish, self-serving individual. Contrary to libertarian and Tea Party rhetoric, evolution has made us a powerfully social species, so much so that the essential precondition of human survival is and always has been the individual plus his or her relationships with others.”

Human beings have evolved for over 50,000 years.  We survive by joining with other people, to support them and receive their support. This happens within the key family unit,  within neighborhoods, cities, places of work, organizations, schools and  indeed   in  our social networks.   We thrive when we love others and receive their love.  We thrive when society works smoothly to provide mutual support, emotional physical and financial. 

     The Tea Party arose from the ashes of Ron Paul’s  failed Presidential Campaign in 2008, so it is only 6 years old.   It was strengthened by the disastrous financial collapse of 2008, which the Tea Party blamed on government rather than on greedy individualism rampant on Wall St.   There is a social evolution of ideas, not just people and societies. The failed, failing and refuted ideas of the Tea Party groups will be dumped on the trash heap, by the evolutionary process of ideas.     

Blog entries written by Prof. Shlomo Maital

Shlomo Maital

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