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Comment by mercutio2 | Hacker News Reader

Big fan of Denmark!

But where in the world did you get the idea people in Denmark do “much better” than people in even the poorest US state?

Median income in the poorest US state (Mississippi) is slightly higher than median income in Denmark, with much lower taxes even if you consider private health insurance a tax.

A similar analysis of people in the poorest decile, after famously stingy US transfer payments, has disposable income for the poor in Mississippi coming out ahead of being poor in Denmark.

I keep seeing folks make this argument. I would love to live in Denmark, but the reason to live there is not because of higher income. The US is just much, much richer than almost all of Europe (Switzerland and Luxembourg are the exceptions, not Denmark).

It’s totally fine to value things like social cohesion, terrific bike infrastructure, and low income inequality. Those are areas Denmark beats the US.

But income? It’s not even close.

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No. That claim is at best highly misleading and, in most straightforward comparisons, simply false. Once you adjust for cost of living, tax structures, and what you actually “get” for your taxes (e.g., healthcare, education), Denmark’s median disposable income generally exceeds that of Mississippi. Moreover, Mississippi’s nominal median household income—while sometimes quoted in the same ballpark as Denmark’s median after-tax income—does not include the considerable out-of-pocket costs U.S. residents pay for things Danes receive through public services (healthcare, college, childcare, etc.).

I included health insurance in my calculation, and public schools in Mississippi are just as free in the US as they are Denmark.

Cost of living is much higher in Denmark, so making that adjustment isn't going to help your argument.

If you assume Danish university education is comparable to paying full freight at Harvard (which no one with a median Mississippi income would have to do) or some other heavy weighting on things that are private in the US, you might get close.

Certainly one can argue there's a large intangible benefit to not having to think about health insurance, and I for one place a large premium on having the opportunity to bike everywhere. I'm not arguing life in Denmark is bad.

No doubt there are many public services in Denmark that make transfer payments to the bottom quintile difficult to measure, but I just have never seen a credible argument that in terms of disposable consumer surplus, the median adult does better in Denmark than Mississippi, accounting for all reasonable costs.

And, of course, most Americans are richer than the median Mississippian.

It seems great to argue about the value of things Denmark is good at, but having a large consumer surplus just doesn't strike me as being one of those things. It's also not a value I think the median Dane agrees should be weighted that high, which is fine.

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