Denmark’s generous safety net is made possible by high taxes – and not particularly progressive taxes at that.  Kicking in at incomes of roughly $6300/year, the lowest tax rate is 37.5%. The highest rate is 59%, starting at about $50,400/year. Counting all sources of taxation, taxes comprise 49% of GDP – the highest in Europe. But then there’s the basic security of universal health care, paid parental leave, free college, and unemployment compensation for up to two years. The Danes are making a trade-off: in exchange for that basic security, their after-tax income is lower and the cost of living a lot higher than what we have in the US.  They live in smaller houses (half the size of US homes, on average) and have less stuff. See

The Danes are what I’d call comfortable but not affluent. The American middle class has much more discretionary income than their Danish counterparts. Even with stagnating wages.

I think the Danish trade-off is worth it. Vibrant business sector, committed to the free market and free trade, balanced by high individual taxes and a basic security for everyone. Who needs big houses and big cars? Doesn’t help the soul and it’s not good for the planet.

Of course, Americans will never go for it. At least not in the near future.