Business interests lauding the welfare state?

Original Reporting | By Mike Alberti |

To that end, Skibsted said that he could not understand why American businesses were so antagonistic toward the government. For example, he said that the recent battle over financial regulations, in which the financial services industry pushed against the attempt by the government to regulate parts of the industry that had led to the financial crisis, was misguided.

“If I’m a financial company, wouldn’t it be better for me to avoid another crisis in the future than to make a little more profit next week?” he asked.

Other Danish business leaders questioned the dynamic between the private sector and the government in the U.S., as well. “Sometimes it seems like they are biting the hand that feeds them,” Bosse said.

Pedersen, who has lived in the U.S., said that while he admires many things about the American system, particularly its entrepreneurial nature, he does not think the current political climate, which is so focused on reducing the role of the state, is going to help business in the future. “Actually,” he said, “I am dead-pan serious when I say that you are destroying yourself.”

Remapping Debate asked Skibsted whether he would rather run a business in Denmark or in the U.S. “In the U.S., I might be richer,” he said. “But I don’t think I would be better off.”

Trimming the welfare state?

While Danish employers stressed that most of the features of the welfare state benefited their businesses, some elements generated opposition. For example, Steen Muntzberg of the Danish Confederation of Employers said that he would like to see a program commonly referred to as “café money” eliminated. That program grants higher-education students who live at home with their parents about $500 dollars a year for miscellaneous expenses. (Café money is provided in addition to free tuition, subsidized transportation costs, and a government living stipend which is directed to the students’ parents.)

Søren Friis Larsen of the Danish Chamber of Commerce added that state subsidy of a student’s living expenses for six years has contributed to the fact that Denmark has one of the highest median graduation ages in the OECD, at about 26 years. “I think it’s nice for everybody to enjoy their studies,” he said. “But we need to get people out into the labor market sooner.”

Friis Larsen also complained about a special unemployment system that exists for workers in Denmark who are disabled or otherwise unable to work. “Basically, you prove to the government that you can’t work, and then you get unemployment assistance for the rest of your life,” he said. Friis Larsen does not dispute that many people benefit from this program, but he said that there should be a “reevaluation,” especially of people who qualify for mental health reasons. “If you are in a car accident and you are paralyzed, of course you should get the money,” he said. “But if you have depression and can’t work, that’s something that can be fixed, so maybe we need to check in every year.”

And perhaps the least popular program among business leaders is the one for early retirement, called efterløn (“after wage”). The program was instutituted in the 1990s in order to incentivize older people — especially those working in manual labor occupations — to leave the workforce to make room for younger workers, who were having trouble finding jobs. But because the general population has aged during that time, it is no longer affordable, according to Muntzberg.

But both Muntzberg and Friis Larsen stressed that these were relatively small changes. “We like the system we have,” he said. “Sometimes you have to do some work under the hood, but nobody wants to replace the whole engine.”


Send a letter to the editor