A SUMMARY OF THE POSITIONS ESPOUSED BY THE CURRENT DANISH

GOVERNMENT REGARDING A SELECTION OF KEY POLITICO-ECONOMIC

POLICIES INSTITUTED BY THE EUROPEAN UNION

Policy Dossier Prepared By:

Nicholas Gober

Submitted: 23 November 2015

INTA 2221 | Politics of the European Union

Georgia Institute of Technology, Atlanta, GA 30332, USA

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CONTENTS

Introduction....................................................................................................................................3

EU Politico-Economic Policy Standpoints

EU Cohesion Policy........................................................................................................................3

The EU Single Market....................................................................................................................4

EU Economic and Monetary Union Policy...................................................................................5

EU Freedom, Security, and Justice Policy....................................................................................7

EU Environmental Policy..............................................................................................................8

EU Trade Policy..............................................................................................................................9

EU Common Foreign and Security Policy..................................................................................10

EU Agriculture Policy..................................................................................................................12

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INTRODUCTION

The Government of the Kingdom of Denmark aims to establish cohesion throughout the

entirety of Danish society, believing that a unified society built upon universal equality, mutual

trust amongst its members, and respect for the individual will not only thrive but vastly prosper.

Despite having made substantial strides toward achieving this goal, sufficient cohesion has yet to

occur in many societal sectors. In particular, adequately increasing cohesion economically,

geographically, and socially is our overarching goal1.

The Danish Government’s plan toward accomplishing said goal, in regards to certain

European Union-instituted politico-economic policies that are currently in effect, is summarized

throughout this report. Currently, our most important priorities2 are the following:

More private jobs through a sound and responsible economic policy underpinning growth

and prosperity throughout the entirety of the Kingdom.

A Denmark where it pays more to work, and where fewer are on public support.

A strong, focused foreign policy that safeguards and promotes Danish interests/influence.

EU COHESION POLICY

It is the belief of the Danish Government that neither a high standard of living nor an

extensive social security system is sustainable (long-term) if debt is accumulated; as such, reducing

the national and foreign debts, as well as maintaining a balanced budget, is a central objective of

the Government. Hence, the economic policy of the Danish Government is aimed at generating a

1 L. L. Rasmussen, “Prime Minister Lars Løkke Rasmussen’s Opening Address to the Folketing” (speech, Prime Minister’s

Inaugural Address to the Danish Parliament at Christiansborg Palace, Copenhagen, Denmark, October 6, 2015).

http://www.stm.dk/_p_14252.html. 2 The Danish Government, Together for the Future: Government Platform, June 2015, (Copenhagen: The Danish Government,

2015), 1, http://www.stm.dk/multimedia/TOGETHER_FOR_THE_FUTURE.pdf.

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stable, sustainable growth of employment. More specifically, the Government holds that economic

policies should build on four pillars: low inflation rate; low interest rates; fixed currency rate; and

sound, stable public finance3.

Denmark needs more jobs in the private sector—this is a precondition for both our common

welfare and for the immediate welfare of the individual family. Companies must improve

conditions for investment and job creation, more people must move from public support into jobs,

and more vacant jobs must be filled by Danes, with all of Denmark benefiting from the economic

progress. Consequently, in an effort to ensure that it pays more to work than to receive public

support, the Government will implement a Job Reform over two separate phases4. Altogether, the

Job Reform will increase the gain from working, thus allowing more individuals to become

employed through an increase in the supply of labor—this will imply less expenditure on transfer

payments, more tax receipts, and a better quality of life for many people.

THE EU SINGLE MARKET

The Danish Government emphasizes that the hallmark of a free society is free competition,

believing that it is the only effective means of creating an open and transparent single market

throughout the entirety of the EU (in which supply and demand play a part in determining prices)

where every individual entity is free to enter into commitments on their own responsibility5.

3 “Domestic Policy,” Venstre National Organization, accessed November 22, 2015,

http://www.venstre.dk/service/english/domestic-policy. 4 Danish Government, Government Platform, 6.

Phase I began on October 2, 2015, when a cash benefit ceiling was introduced4 which effectively placed a cap on the amount of

public benefits recipients of cash benefits are eligible to receive; the ceiling comprises the majority of public benefits that a cash

benefit recipient may be entitled to, and the generated revenue will contribute to the financing of Phase II, which will begin in

early-mid 2016 when the Government initiates trans-party negotiations in regards to lowering taxes on earned income. The purpose

of Phase II is two-fold: 1) to reduce taxes for the lowest income brackets to ensure that the gain from low-paid work is increased;

and 2) to reduce taxes on the last earned krone by 5% to ensure that more people will work more frequently and to make it easier

for Danish companies to recruit and retain well-paid employees. 5 “Basic Political Principles,” Venstre National Organization, accessed November 22, 2015,

http://www.venstre.dk/service/english/basic-political-principles.

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Established in 1992, The EU Single Market has led to the creation of millions of jobs that

can be directly attributed to its inception; nonetheless, many barriers preventing the formation of

a truly authentic, all-encompassing Single Market (i.e., free movement of goods, capital, services,

and people amongst all 28 member states being a 100% seamless process within the various

sectors), still exist today, particularly in regards to growth. The EU’s 28 “mini-markets” could,

theoretically, be crafted into one enormous common market if all gaps in free movement were

eliminated, particularly within the digital sector6.

Currently, the Digital Single Market is not well-established across the EU for two main

reasons: 1) Internet security is not equivalent throughout the EU because consumer rights are not

entirely uniform amongst all member states; and 2) as of 2013, only ~50% of all EU citizens had

access to Internet service at speeds of (at least) 30 MB, while a mere 2.5% had access to speeds of

(at least) 100 MB. The Government believes the EU should work toward, in conjunction with

national parliaments, ensuring every single EU citizen has access to 30 MB Internet service, with

at least 50% having access to 100 MB speeds, by the year 20207.

The EU Services Directive, the objective of which, according to the Commission itself, is

to “realize the full potential of services markets in Europe by removing legal and administrative

barriers to trade 8 ,” has, to date, failed to form a Single Market within the service sector.

Accordingly, the Government will work toward implementing the principles/obligations of the

6 Venstre National Organization, Venstre’s EU Electoral Manifesto: A Europe of Solutions, 2014-2019, (Copenhagen: Europa-

Nævnet), 8, accessed November 22, 2015,

http://www.venstre.dk/_Resources/Persistent/85eab293c7f92e0ff45112f7d56eedcecc227e56/ENG-Venstres-EU-program-2014-

2019.pdf. 7 Venstre, EU Electoral Manifesto, 8. 8 “Services Directive,” European Commission, last updated November 20, 2015, http://ec.europa.eu/growth/single-

market/services/services-directive/index_en.htm.

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Services Directive by, among others actions, demanding sanctions against member states not

actively adhering to the established regulations.

EU ECONOMIC AND MONETARY UNION POLICY

The Government aims to restore confidence in the EU economy, as well as in EU banks—

this requires acknowledging that the Economic and Monetary Union should be expanded. The

Government supports supplementing the common monetary policy with a banking union, as well

as tightening of the rules governing both budget discipline and the implementation of reforms. The

Government believes that stabilization of the euro is crucial for the health of the EU economy9.

A lack of stability in the European banking sector has continued to extend the duration of

the EU debt crisis. More stringent, uniform regulations are an important step in ensuring access to

capital for businesses and, thus, in restoring trust in EU banks. Still, however, EU citizens must

have assurance that their savings will be able to endure a potential bank collapse. The Danish

Government believes that if we are to improve bank supervision and reduce the risk of expensive

bank bailouts, a banking union is required. The Government regards participation in the banking

union as a mutual insurance arrangement, in which the ties between member states and banks can

be severed, thus eliminating the risk of sovereign default in the event that the bank fails10.

Many countries today are unable to independently save their respective banking sector

because the costs to do so would be greater than the overall size of their national economy; this is

also true of Denmark, where the banking sector is four times the size of the Danish economy. The

Government believes that it is vital that construction of the banking union ensures that, in principle,

9 Venstre, EU Electoral Manifesto, 13. 10 Venstre, EU Electoral Manifesto, 15.

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it is the banking sector, neither the state nor the taxpayers, that finances this insurance. Just as there

must be a guarantee that the Danish mortgage finance system will be allowed to continue in its

present form, Danish participation in the banking union must correspond with the Danish opt-out

of the euro11.

EU FREEDOM, SECURITY, AND JUSTICE POLICY

Indeed, Denmark is a safe and secure country, and we must ensure that it remains so; aptly,

the Government calls for an increase in visibility of the Danish police force, desiring for all Danes

to feel safe and secure to the maximum possible degree. In an effort to ensure that the police and

other relevant authorities have sufficient access to the resources they require, the Government will

allot funds to: 1) increase the intake of police trainees; 2) establish a police officer training

program in Western Denmark; and 3) ensure greater task transfer in the police so that non-policing

tasks can be performed by other staff groups to a greater extent12.

Subsequently, the Government will take vigorous, resolute action in places where safety

and security is threatened, effectively adopting a new, harsher approach to crime. In particular,

this approach applies to (but not limited to) crime committed by gangs and bikers, which is

gradually becoming more and more brutal and ruthless—thus, monitoring of bikers and gang

members will be strengthened, and the opportunity for parole will be reduced13.

Similarly, the Government will also take action against non-Danish citizens who commit

crime in Danish-owned territory. Exploiting the trust of Danish society, these foreign criminals

must be deported to a country of which they possess citizenship to serve their prison sentences;

11 Venstre, EU Electoral Manifesto, 15. 12 Danish Government, Government Platform, 18-19. 13 Danish Government, Government Platform, 18.

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suitably, the Government will tighten the deportation rules and enhance efforts to ensure

deportation of foreign criminals14.

EU ENVIRONMENTAL POLICY

The Danish Government’s environmental policy is based on green realism, a concept

which suggests there must be coherence between the environmental policy goals and the resources

available to meet said goals—this green transition must be implemented in a way that is prudent

relative to developments both in Denmark and the world around us15.

The Government wishes for future generations to inherit a healthy environment that is in

good condition; yet, a precondition is that we are able to simultaneously create growth, jobs, and

prosperity—that is, the environmental policy goals must be achieved in the most socio-

economically effective way, in which the most environmental value relative to the amount of money

spent is secured. The Government’s ultimate goal is for Denmark to be completely independent of

fossil fuels by the year 2050 (i.e., 100% of Danish energy consumed in 2050 will have been

produced by Denmark itself in an entirely renewable fashion)16.

The Government believes that the individual citizen is responsible for taking care of the

environment by reducing their use of products with large environmental impacts and their overall

amount of waste generated. Pollution does not respect borders, which is why it should be

combatted through strong international cooperation. Environmental taxes should have a positive

impact on the environment; the principle, therefore, should be that the consumer/producer should

be able to reduce, or even completely avoid, environmental taxes by changing approaches to

14 Danish Government, Government Platform, 18. 15 Danish Government, Government Platform, 23. 16 Danish Government, Government Platform, 23.

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consumption/manufacturing—environmental taxes should not increase the overall tax burden but

constitute an economic incentive for environmentally-friendly behavior17.

EU TRADE POLICY

The international trade policy of the Danish Government fundamentally aims at allowing

more free-trade on a global basis. The Danish economy, the global economy, and the economies

of developing countries will all benefit from an increase in international trade. Denmark’s

international trade policy is conducted in close co-operation with the other EU member states18.

Although international trade policy may be conducted both bilaterally and regionally,

Denmark and the EU remain fundamentally and clearly committed to multilateral negotiations;

thus, the World Trade Organization (WTO) is the primary focus of both Danish and EU trade

policies. The WTO system creates an international legal system, providing the necessary

guarantees for all actors in the global economy; it ensures the involvement of, and consideration

for, developing countries. It is important for Denmark that the WTO agreements can be enforced

through WTO’s dispute settlement system. The alternative to WTO’s regulation of international

economy is that “might is right.” Likewise, it is important for Denmark to continuously search for

flexibility in agriculture and other important areas of negotiation19.

Denmark is among the most active liberal trade and development-friendly member states

of the EU. Accordingly, Denmark works within the EU to promote common positions along these

lines to help integrate developing countries into the multilateral trading system. Simultaneously,

17 “Domestic Policy,” Venstre. 18 “International trade policy,” Ministry of Foreign Affairs of Denmark, accessed November 22, 2015, http://um.dk/en/foreign-

policy/international-trade-policy/. 19 “International trade policy,” Ministry of Foreign Affairs.

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Denmark fully respects the fact that trade policy of the EU almost exclusively lies within the

purview of community competence20.

A number of EU bilateral or regional trade agreements are presently finalized or under

negotiation. These bilateral agreements constitute an important complement to the results obtained

in the multilateral WTO negotiations; although important, EU's bilateral agreements generally do

not have a significant impact on Danish economy, as almost 70% of the Danish foreign trade is

with other EU countries or EU-acceding countries. These other markets, the most important of

which are of the USA, Canada, Japan, and China, are not presently covered by bilateral nor

regional EU agreements; therefore, the main focus for Denmark and the EU within the

international trade negotiations remains establishing multilateral agreements21.

EU COMMON FOREIGN AND SECURITY POLICY

Trans-border crime. The Government strongly believes that fighting crime effectively,

both domestically and abroad, requires close European police cooperation. The Government seeks

to ensure that Denmark can continue its participation in the EU law enforcement agency Europol22;

accordingly, an upcoming referendum on converting the current Justice and Home Affairs (JHA)

opt-out into an “opt-in” arrangement23 is currently scheduled to be held on December 3 of this

year, a major shift which would enable Denmark to decide for itself which parts of JHA policy it

wishes to participate in and/or forego24.

20 “International trade policy,” Ministry of Foreign Affairs. 21 “International trade policy,” Ministry of Foreign Affairs. 22 Danish Government, Government Platform, 19. 23 Also referred to as a “partial opt-out” arrangement. 24 “Denmark to vote on Justice and Home Affairs opt-in model on 3 December,” Ministry of Foreign Affairs of Denmark, August

21, 2015, http://um.dk/en/news/newsdisplaypage/?newsID=DCB9FAA3-37A6-4673-989F-0C771B7CFAFE.

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Furthermore, to improve Europol’s capability of fighting against trans-border crimes (e.g.,

child pornography, international gangs, etc.), the Government wishes for funds to be set aside for

joint international investigations. The Government believes that new types of crime could be dealt

with more effectively by setting up an information center of excellence under Europol;

additionally, the European Cyber Crime Centre should be supplemented with one designed to

combat fraud in the food industry25.

Terrorism. The perpetual threat of terrorism became concrete with the tragic events that

occurred in Copenhagen this past February. In an effort to avert any potential recurrences, the

Government will strengthen protection against terrorism and will both maintain and expand its

international cooperation against terrorism. Denmark must continue to participate in the

international coalition against ISIL, contributing militarily to efforts undertaken to eliminate its

authority throughout Syria, Iraq, and elsewhere across the globe26.

Denmark will remain a free and independent nation solely with Danish participation in a

legally-binding international community, in which the Danes cooperate with other nations to create

freedom, peace, and prospects of better living conditions. As it is necessary to have a military

defense system to ensure freedom and peace, Denmark shall remain a full member of NATO

(North Atlantic Treaty Organization) and shall contribute to the common efforts of having a

reliable defense27.

Immigration. To prevent the disastrous effects that accompany extreme border-congestion,

the EU will have to modernize its external border control in which relatively easy passage for

business people/students is guaranteed while also ensuring far more difficult entry-regulations for

25 Venstre, EU Electoral Manifesto, 19. 26 Danish Government, Government Platform, 18. 27 Danish Government, Government Platform, 30.

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criminals/illegal immigrants. The Danish Government believes28: 1) member states should be able

to request that the Commission perform a survey of external border controls29; 2) the EU’s joint

border agency, Frontex, should have greater powers to instigate closer cooperation/assistance to

volatile member states/third-party countries; and 3) the EU must create a common system with the

same asylum rules and criteria to be adhered to by all member states30.

EU AGRICULTURE POLICY

The rising global demand for food provides new growth opportunities for European

agriculture sectors, in turn necessitating investments in research, high standards of food quality,

and sustainable development. The EU should focus research on applications of technology in the

food/agriculture sector, and it should attempt to establish free trade agreements with various non-

EU countries so that new markets within the industry are opened31.

The Danish Government supports a subsidy-free farming policy; however, a settlement of

EU farm subsidies must not lead to the renationalization of agricultural policy, where individual

countries can establish national aid schemes and thus distort competition. The Government is

convinced that Danish Agriculture will be able to perform better in the global market competition

without constricting rules imposed by EU agricultural subsidies32.

When the newly-adopted CAP (Common Agriculture Policy) reform is fully implemented,

the Government wishes for “burden checks” so that potential unnecessary burdens that may have

28 Venstre, EU Electoral Manifesto, 19-20. 29 They could then decide each year if an individual member state should be suspended from the Schengen Area until it had

reinstated credible border controls. 30 This should prevent the phenomenon of “asylum shopping” from occurring (i.e., asylum seekers abusing the differences in the

various national regulations, seeking asylum where the rules suit them best). 31 Venstre, EU Electoral Manifesto, 12. 32 Venstre, EU Electoral Manifesto, 12.

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arisen as a result of said reform may be reduced. The Danish Government believes it is important

to implement the same in all member states to avoid any difficulties with propelling agriculture in

Denmark33.

33 Venstre, EU Electoral Manifesto, 12.