Russian-Danish Students Conference in Copenhagen. November – December 2018. Bjørnø Irina
of the socialist movement, therefore he was the main influence on the minds of mankind. His vision went beyond the usual society. He believed that everything that preserves the features of the former does not give rise to communism. The theory recognizes the system of equality of labor spent, depending on how much time and effort the manufacturer has spent on manufacturing products and they are related to wages.
Time passed, but the capitalist society of philosophers did not develop, and capitalism gained momentum, although the ideas of thinkers influenced capitalism, thereby giving it development in the new direction, which included socialism and positive principles of communism ideas.
In modern Western European countries, the theory of socialism becomes an integral part of the life of the capitalist system, in which a materialistic view of things, earning money and running a business becomes impossible without respectful treatment of the population directly related to the further enrichment of resources created through the use of human labor. There was a reassessment of values: from the enslavement of an employee and a businessman by the top of capitalist society to respect for an individual who has his own needs for social support, economic stability, and ensuring the future well-being of the state.
Social guarantees provide the working class and incompetent population with a “safety cushion” in the world of money, where there are no guarantees and confidence in the future. Although the concept of “capitalism” is already implemented on a different, higher level, this is why many economically advanced powers unobtrusively demonstrate their “economic miracle” by example.
The formation of a special model of economic development should be in the developed world points of an economic oasis, which is distinguished by a more efficient system of managing economic and economic resources that can withstand the changes taking place in the global economy, which should result in the emergence of various models of the economy and market. One of the most successful of these models is the Scandinavian model of general welfare. On the world stage against the background of world economic confusion, the Scandinavian countries easily overcome the economic crisis. These countries are Denmark, Finland, Sweden, Norway and Iceland.
The Scandinavian countries show by their example how to manage their own resources to ensure economic stability without undue influence of politics. The key difference of the Scandinavian model is that many already call this model modern socialism, which differs significantly from the model of the 70’s.
To date, the Scandinavian countries have long caught up with the United States in terms of the level and quality of life, and health care and education are considered the best in the world. With the absolute freedom of the private sector, the public sector still plays an important role and is an essential part of the Scandinavian miracle. The main feature of the transformation model is the dominant role of the state in the socio-economic activity.
The uniqueness of the Scandinavian model lies in the fact that for a long time countries stood apart from wars and revolutions, and therefore were least affected by the destructive impact. In the thirties of the last century the Social Democrats came to power in the Scandinavian countries. They set a course for a market type of economic activity, including the entire degree of protection of the population at the same time. Consequently, we can say that the Scandinavian economy is a mixed type of economy with the overwhelming role of private property and the constant participation of the state.
Danish miracle
From January 1, 1999, the Danish krone is tightly tied to the euro at a ratio of 7.46038: 1 and free to move in a narrow corridor (no more than 1%). Such a pegging requires the Danish government to constantly have free reserves in euros in order to keep the national currency rate in a given corridor if necessary. In such circumstances, the decision of Denmark to refuse to lend in foreign currency looks pretty risky.
So, according to the McKinsey Global Institute, the sovereign debt of 47 countries leading in terms of already existing debt increased from 142 trillion dollars in 2007 to 199 trillion in 2014 (40% in 7 years!). Over the same period, total global debt increased from 269% of total GDP to 286%.
Such a dynamic cannot but cause concern, since it is commonly believed that during these very years there was a “deleveraging” in the world economy – a massive decrease in borrowed funds.
What is striking, however, is not so much the deliverance of Denmark from uncontrolled foreign currency debt at a time when the whole world is moving in the opposite direction, but the social and economic consequences of this step within the Scandinavian country itself!
The fact is that a sharp reduction (especially complete liquidation!) Of external sovereign debt dependence was almost always accompanied in history by a catastrophe both for the national economy and for the quality of life of citizens of the country who risked conducting this questionable experiment.
As an example, we can recall the socialist Romania of the 70—80s, who first collected debts, and then decided to return them all at the expense of the proceeds from the enterprises, and then burned them out.
The more striking is the background against which the Danish Kingdom liquidated its sovereign foreign currency debt:
– according to the World Happiness Report, published by the UN and taking into account such indicators as real income per capita, level of social protection and support, life expectancy, quality of medical care, freedom of life choices and corruption, citizens of Denmark share with their neighbors Norwegians first place in the ranking of the happiest inhabitants of the planet;
– The unemployment rate is two times lower than the average for Europe;
– The lowest social equality indicator in the world.
– The lowest level of corruption in the world;
– First place in the World Bank Ease of Doing Business rating (ease of doing business);
– The highest sovereign credit rating (in addition to Denmark, AAA has a rating of only 10 countries: Australia, Canada, Germany, Hong Kong, Liechtenstein, Holland, Norway, Singapore, Sweden, Switzerland).
Parade of models
In Denmark, a unique model of the structure of society and the economy is being implemented, which is different from the notorious LME (Liberal Market Economy) and from CME (Coordinated market economy). The academic name of this model is Negotiated Economy (NE, contractual economy), but another term is better known – the Nordic Model, the Scandinavian model.
Formally, the NE is considered a variety of CME, coordinated by an economic model, but it has a number of fundamental differences. In CME, the idea of corporatism is embodied by the state, which interferes in social and economic relations. In the NE, corporatism is decentralized. The agreements are implemented at the grassroots level: directly between entrepreneurs and workers (or rather, the trade unions representing them), as well as between other civic groups that have their own interests that deserve the attention of society. Everyone has the right to vote and the right to listen to this voice. The state is assigned the role of a mediator, a guarantor of a social contract that provides classical functions (legal proceedings, law enforcement, foreign policy etc.).
The Scandinavian model, as the name suggests, is implemented today in Denmark, Norway, Sweden, Finland, as well as in the Netherlands. This model has a common foundation due to the universal mentality of the Scandinavian peoples, as well as private specificity reflecting the historical evolution of each nation and country separately.
The Danish experience, in my opinion, is the most interesting, because only in Denmark the role of the state is reduced to such a minimum that it is time to doubt the model itself as a coordinated market economy.
FÅ HAR FOR MEGET OG FÆRRE FOR LIDT
The combination of a capitalist economy with the ideals of socialism is by no means Danish exclusive. The same values