
Denmark’s Idea Could Help the World Avoid a Great Depression - Elof
https://www.theatlantic.com/ideas/archive/2020/03/denmark-freezing-its-economy-should-us/608533/
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lioeters
The idea is to "freeze the economy" by massive government spending, covering
various costs of private companies and the people.

> the Danish government told private companies hit by the effects of the
> pandemic that it would pay 75 percent of their employees’ salaries to avoid
> mass layoffs

> The plan could require the government to spend as much as 13 percent of the
> national economy in three months.

The state has agreed to take on 75 percent of workers’ salaries, up to $3,288
per month, for them to _stay home and not work_ , while still being employed.

In addition:

\- the state will guarantee 70 percent of new bank loans to companies

\- people on unemployment benefits will continue to receive it, without the
usual requirements, and even past the 2-year limit

\- the state agreed to compensate companies for their fixed expenses, like
rent and contract obligations, depending on their level of income loss

\- the spring payment of taxes for companies have been postponed until autumn

\- all public employees will keep their salaries when sent home

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soegaard
To be clear. The public employees are working from home.

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dmode
This is an extraordinarily bold step and I agree in theory. But the risk is
extremely high and I am curious what the downsides will look like for an
approach like this

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KSteffensen
From your point of view what are the risks here?

Denmark's current debt level is at around 35% of GDP, so we should be able to
debt finance this for a while and still have money for further stimulus
packages to start things up once corona has passed

