COLUMN ONE : A Success Story for Socialism : Despite failures elsewhere, Denmark's system offers comfort, security and economic gains. But there is unease about the young as many find joblessness acceptable.

TIMES STAFF WRITER

From Stockholm to Sofia, events in Europe over the last few years have seemed to convey one clear message: Socialism, whether democratic or despotic, just doesn't work.

Except in Denmark.

Revolutions may have swept Soviet-style communism from Eastern Europe, and hard-nosed new thinkers in such bastions of the welfare state as Sweden may work to dismantle key programs, but little Denmark still makes socialism go.

Indeed, perched on the fringe of a continent that is in the midst of fast and bewildering change, this tidy, affluent Scandinavian nation of 5 million is about as close to the end of the rainbow as a European will get in these worrisome times.

The aggressive energy and tension that uncertainty has brought to the streets of European capitals such as Berlin and Moscow are absent in Copenhagen.

Here, in Europe's oldest kingdom, life is calmer, more comfortable and secure.

Medical bills aren't a problem; they don't even exist. Neither does nuclear power. Every working individual gets five weeks' vacation a year, while those who don't work get jobless benefits of up to $17,000 annually.

Political violence and ethnic strife are things that happen elsewhere in Europe; Danish women have probably come further in closing the gender gap than those of any other Western country, and the government spends 10 times as much on the social welfare of its people as on defense.

In the mid-1980s, University of Pennsylvania social scientist Richard Estes rated what he termed the "social progress" of 107 nations and concluded that Denmark ranked No. 1.

There is little evidence to indicate that it has slipped since then.

"If you look at European statistics, the most satisfied people of all are the Danes," noted Copenhagen University historian Nils Thomson.

When asked about the country's future social agenda, Jacob Wedel-Pedersen, recently retired executive director of the Danish National Institute of Social Research, remarked, "In a way I feel the job is done. My party (the Social Democrats) has nothing more to do, other than to guard what it has achieved."

What is especially remarkable about Denmark's social success is that it is anchored in an unparalleled economic prosperity.

As other Nordic welfare states cut burdensome programs to revive their flagging economies, Denmark sails ahead, untroubled. In percentage terms, the country today has the lowest inflation rate and the largest trade surplus of any European Community country.

It is a rare Western nation sporting a positive trade balance with Japan. Its foreign debt has dropped by a quarter over the last four years, and industrial productivity has jumped sharply.

Denmark's recipe for success appears to be anchored in a combination of political compromise, economic restraint and good fortune that has characterized the decade-long rule of a center-right coalition headed by Prime Minister Poul Schlueter, the country's first conservative leader since 1901.

Schlueter's policy to curtail excesses and misuse of the welfare system, yet leave the basic system intact, struck a chord with a public that backs the idea of the socialist state but feels that it sometimes pushes the line between private and public responsibility too far.

The mood favoring greater individual responsibility continues to grow, observers say.

"You can feel the change in atmosphere," noted Jorgen Grunnert, managing editor of Denmark's largest-circulation morning paper, Politiken.

He and others cite pressure for reduced jobless benefits and a recent move by the doctrinaire Social Democrat Copenhagen city government to ease its once-purist stand on public ownership of land by selling the famed Tivoli Gardens into private hands to raise much-needed cash.

Still, underlying public support for a broad-based social welfare system in Denmark remains unchallenged.

The roots of Denmark's welfare state go back to the constitution of 1849, which first established the right of anyone unable to care for himself or his family to receive government help.

Over the ensuing century and a half, other benefits--including free medical care, liberal unemployment and industrial accident insurance, housing for the very old and child care for the very young--were implemented as part of a cradle-to-grave system to which all contributed and from which all--irrespective of income--could benefit.

While the success of the welfare state in Denmark--as well as in Norway and Sweden--inspired parts of Franklin D. Roosevelt's New Deal in the 1930s and later provided the model for post-World War II social democracies in West Germany and Austria, nowhere have social programs matched the breadth or enjoyed the public support of those in Scandinavia.

Here, strong egalitarian traditions combine with a sense of social solidarity stemming from a time when only tightknit rural communities survived the hard Nordic winters, producing the underpinnings of modern social programs.

In Denmark, welfare is not a dirty word. It is a way of life.

In interviews, Danes repeatedly linked the need to care for society's weaker elements with their own personal well-being.

"I like to live in a society where I know others are cared for," commented Anne Jensen, chief economist and first vice president of Unidanmark, the country's second-largest financial institution, and the mother of two children.

"You don't see beggars in Denmark, and I'd feel personally humiliated if I did. In general, it's very difficult for Scandinavians to go to the U.S. or southern Europe and see the social differences that exist. When we criticize the (welfare) system, it's from the point of view that to have it is a must," she added.

A Copenhagen high school administrator, Arne Andresen, recalled how for years he bitterly opposed Denmark's welfare system and the high taxes (average rate of 51%) he paid to support it until he experienced an incident while traveling abroad involving a small boy who had seriously burned himself.

"We got the child to a hospital and were comforted that the staff was running around on his behalf," Andresen said. "Then we realized they weren't running for first aid, but for a contract to make sure we'd pay. That incident changed my views completely and made me understand what we have here."

Denmark's present economic prosperity has been helped by a set of austerity measures imposed by the Schlueter government in the mid-1980s to reduce domestic consumption and halt a credit boom that had endangered the country's prosperity, while a series of modest wage settlements reduced real incomes but boosted international competitiveness.

"The living standards were too high," Wedel-Pedersen said. "We were driving toward catastrophe in a golden chariot, but that's not so anymore."

Economically, the country has also gotten a windfall from German unification, exploiting traditional trade links with its southern European Community neighbor, especially in the Mecklenburg-West Pomeranian region of newly free eastern Germany, to sell goods ranging from down comforters to domestic appliances. Danish industry plans to invest over $100 million in eastern Germany.

Despite their prosperity and comfort, the Danes certainly see themselves as having worries.

Unemployment, at over 9%, is unusually high, and there is concern about a worrisome downside to Denmark's comprehensive welfare system.

Jensen, for example, believes it has produced "a two-thirds society," in which an increasing number of young people grow up, live completely outside the labor market on social benefits and then take early retirement, sometimes as early as their mid-20s.

"You give people money, but they have a life with no future, and no one expects anything of them," she said. "There is a large number of inactive people in the age groups that should be most active."

Bennj Haughoej, a welfare official in the Copenhagen city government who has daily contact with the problem, worries about the shifting attitudes of younger people. "In the 1970s they worried that something was wrong with them if they couldn't find work, but for more and more, it is now perfectly acceptable not to work at all," he said.

He also rejected government proposals that would force jobless young people to put in a few hours each day helping out at recreation centers or other publicly run institutions in order to qualify for unemployment benefits.

"It might keep them from sleeping into the middle of the afternoon, but that's no long-term answer," Haughoej said.

Far more than abuses of the welfare system, however, Danes fret that their comfortable existence and their national identity may be in danger of being swallowed in the process of European economic and political unity.

"There's the feeling the country is about to be invaded and the Danes aren't even being asked," said Thomson, the historian.

Most believe that the national referendum on the two EC treaties planned for June will result in a yes vote, mainly because such a small country has no real choice but to be pulled along. But the concern is evident.

Some talk of meddling, insensitive Brussels technocrats who have no sense of the history or sociology of what they are trying to do, while others fear that increased labor mobility will drain Denmark of its skilled workers, who will be drawn to greater opportunities in Germany or other, more centrally located EC nations.

"Will we end up as a country for vacationers and tourists on the fringe of Europe or what?" asked Wedel-Pedersen.

But in a country where life is a stride slower than in the larger industrial nations of northern Europe, where traffic jams are rare, parking places are plentiful and a gently rolling rural landscape offers a reassuring sense of tranquillity, the urgency of such worries is relative--as is suggested by the deadline for a parliamentary commission set up to study social problems in Danish society:

There is none.

A Welfare State Success

Welfare is a way of life in Denmark, which prides itself on the way it cares for the needy and its workplace benefits.

Jobless benefits range to $17,000 a year.

The government spends 10 times as much on the social welfare of its people as on defense.

Medical care is government paid.

All workers get five weeks' vacation a year. Denmark at a Glance

Population: 5 million.

Government: Constitutional monarchy.

Inflation rate: 2.7%

Unemployment: 9%

Literacy rate: 99%

Organized labor: 65% of work force.

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