High Taxes Are Good?


It isn't very often that you hear someone argue that high taxes are a good thing. It's a little counterintuitive, which I like, but overall I'm not buying it. I think the argument mistakes a bit of correlation for causation.

The danish model, rather than hindering economic growth is more likely to be the source of it, for one simple reason: It promotes happiness at work. Working only for the pay doesn't pay and unemployment benefits are pretty good, so why should you stick with a job you don't like. And let me say this again: People are very rarely productive in jobs they don't like. This frees employees to find a different job they DO like – and no-one is more productive than an employee who truly loves her job.

He's right about happy employees. I think we are starting to see that here in the U.S. Some people will take less money in return for a higher quality of life, and that is fine if that is what they want. But I'll offer another suggestion based on my brief stint living in Copenhagen.

Denmark is a very small country, and thus has embraced trade and globalization much more so than most other countries. Plus at the high school level they are more educated than Americans. I think part of the success of the Danes is due to these factors.

Of course, as always, you are welcome to disagree with me in the comments…