by Mitch Kokai
Senior Political Analyst, John Locke Foundation
David Harsanyi explains at National Review Online why U.S. Rep. Alexandria Ocasio-Cortez is wrong about the government-mandated minimum wage. He focuses specifically on AOC’s statistic that McDonald’s workers in Denmark make $22 per hour.
The most obvious problem with Ocasio-Cortez’s contention is that Denmark, like other Scandinavian nations, doesn’t have a statutory minimum wage. Industries and workers engage in sector-by-sector salary negotiations, which might well undermine intra-industry competition, but which is a much better idea than the flat national-wage floor being peddled by Democrats. So, this popular progressive talking point about Denmark’s miracle middle-class fast-food worker doesn’t make much sense to begin with.
Especially when one considers that the per-capita income in the United States is virtually the same as in Denmark — quite a feat given that we’re a pluralistic nation of around 330 million people that naturalizes another 900,000 people every year, many from poor nations, and that Denmark is a homogeneous country of fewer than 6 million citizens that, in recent years, has effectively shut down its borders to poor immigrants.
Denmark’s generous welfare state is propped up by shared social and cultural norms, and institutions that are habitually reviled by American progressives: unimpeded international trade, low regulatory burdens on business, and sometimes oil and gas checks — Denmark and Norway are Western Europe’s largest oil and gas producers. …
… Then there is the matter of what exactly $45,000 — the salary an employee making $22 an hour on a full-time basis would earn — means in each country. Denmark can afford its system because high taxes are paid by all its citizens, not just the wealthy. Not only do Danish fast-food employees making $45,000 hand over around half their earnings to the government, they pay a 25 percent value-added tax on most purchases, as well as a number of other levies. In return, Danes are afforded all kinds of government-provided services. Presumably, Ocasio-Cortez approves of this arrangement. Either way, Americans whose eyes light up at the prospect of making $22 per hour should know that nearly $11 of that goes straight to the state.