A Growing Dissatisfaction

Denmark has long been envied as a model welfare state of social harmony and governmental stability. No more. Since last spring, tens of thousands of discontented Danes have taken to the streets in demonstrations to protest inflation (currently 19% annually) and unemployment (10.3%--the highest in Western Europe). In contrast to oil-rich Norway and politically stable Sweden, Denmark is so problem-ridden that Danish Economist Thorkil Kristensen notes: "It is not easy to write anything encouraging about Denmark today."

Free Services. The public unrest also reveals a growing dissatisfaction of many Danes with the cost of their cradle-to-grave social-welfare system, pioneered by the Social Democratic Party, which has been the country's major party for the past half-century. Increasingly, Danes question whether they can afford a constant expansion of state services that include free kindergartens, hospitals, university education, generous old-age and disability pensions, and liberal housing subsidies. More than 550,000 bureaucrats are on the public payroll against only 415,000 workers employed in all Danish manufacturing. An average of $800 is spent for each of the 5 million men, women and children of the country. To finance such services, the tax collector takes from 50% to 60% of the average Dane's salary.

Next week the Danes will head for the polls to elect their second Folketing (Parliament) in 13 months to decide how much welfare and inflation they will tolerate. The right-of-center minority government of Premier Poul Hartling, 60, called for elections last month after failing to muster a majority for a one-year freeze on wages, prices and profits. Although the bland, schoolmasterly Hartling has by no means attracted a large popular following, his Liberal Party (according to the latest polls) may win as much as 30% of the vote--compared with 12.3% in December 1973. If these projections are correct, the Liberals will topple the Social Democrats from their position as Denmark's largest party. Hartling may then be able to constitute a coalition government strong enough to enact tough wage and price controls and continue his modest cutbacks on taxes and welfare.

Advocating even greater slashes in spending than Hartling wants is the Progress Party, which has emerged as one of Denmark's major forces. In the Folketing election of December 1973, one-sixth of the country's 3 million voters cast ballots for the Progress Party, which has been very critical of the way the welfare state has functioned. Its leader, Mogens Glistrup, 48, an iconoclastic Copenhagen millionaire lawyer, who is now under indictment for tax fraud, promised to "fire one bureaucrat every ten minutes for the next three or four years." With 28 of the Folketing's 179 seats, the Progressives became the second largest faction in that body, after the Social Democrats' 46 seats and ahead of the Liberals' 22 seats. Current polls project that the Progressives will retain most of their support.

The deterioration of Denmark's economy in the past year in large part has been caused by the fourfold hike in the price of imported oil (upon which 90% of the country's energy output depends). With its import prices rising twice as fast as its export prices, Denmark suffered a more than $ 1 billion balance of payments deficit in 1974. Unemployment, at a 22-year high, has cut deeply into some professions. "If you take the No. 6 bus on Thursdays," observes Architect JO/rgen Andersen, 39, "it is full of architects on their way to the unemployment office." (Andersen himself will be laid off by March 1.) They are casualties of the slump in the construction industry. Other industries particularly hard hit: textiles, meat-packing and car assembly.

Although the Danes managed a smile for the Christmas season and feasted on the traditional goose and rice puding, they were hardly in a festive mood. Their holiday purchases tended toward necessities like clothes rather than luxuries, betraying their anxiety about the future. Said Andersen's wife Hanne: "Judgment Day is getting closer."

However exaggerated the fears, Danes unquestionably face hard days ahead. Even if a wage and price freeze is enacted, it is not--as many nations have learned--a solution to basic economic ills. The government will also have to press ahead in retrenching the welfare state. However, the powerful labor unions (1.2 million members) are expected to continue to be adamantly opposed to both a wage freeze and welfare cutbacks: they could make their opposition forcibly felt by calling for mass strikes. This would further cripple the economy and polarize the country's political atmosphere. The result for Denmark could be its worst political trouble in this century.

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