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Does Denmark lose almost $700 million a year “carrying” Greenland?
Do Americans spend 49 billion dollars a year on pets?Does Apple support half a million American jobs?Have the Clintons received $153 million in speaker fees?Does the UK send the EU £350 million a week?Does it take the average US worker in 2015 just 17 weeks of work a year to earn the average living standard of 1915?Does the fossil fuel industry benefit from trillions of dollars of subsidy from governments every year?Did Amazon pay $0 in taxes last year?
.everyoneloves__top-leaderboard:empty,.everyoneloves__mid-leaderboard:empty,.everyoneloves__bot-mid-leaderboard:empty margin-bottom:0;
In this precise moment of this video, (found on this this article) Donald Trump says about Greenland:
It's hurting Denmark very badly because they are losing almost $700m a
year carrying it, so they carry it at a great loss
The fact that Greenland is subsidized by Denmark is on CIA world factbook (inside the "economy" tab):
Greenland’s economy depends on exports of shrimp and fish, and on a
substantial subsidy from the Danish Government. Fish account for over
90% of its exports, subjecting the economy to price fluctuations. The
subsidy from the Danish Government is budgeted to be about $535
million in 2017, more than 50% of government revenues, and 25% of GDP.
Is it fair to say that Denmark has to "carry" Greenland, or do the benefits/profits outweigh the costs?
economics denmark greenland
add a comment |
In this precise moment of this video, (found on this this article) Donald Trump says about Greenland:
It's hurting Denmark very badly because they are losing almost $700m a
year carrying it, so they carry it at a great loss
The fact that Greenland is subsidized by Denmark is on CIA world factbook (inside the "economy" tab):
Greenland’s economy depends on exports of shrimp and fish, and on a
substantial subsidy from the Danish Government. Fish account for over
90% of its exports, subjecting the economy to price fluctuations. The
subsidy from the Danish Government is budgeted to be about $535
million in 2017, more than 50% of government revenues, and 25% of GDP.
Is it fair to say that Denmark has to "carry" Greenland, or do the benefits/profits outweigh the costs?
economics denmark greenland
In the USA, territories tend to "cost" rather than "payout" or "profit". But even some states "cost" in the same way. Could be a similar thing. It's debatable if that's even the right outlook, but when you're trying to convince someone to sell ...
– fredsbend
53 mins ago
Note that the subsidy is an important factor in allowing Greenlandish "home rule" as opposed to the historical "everything in this colony is ruled from Denmark". Understanding this development is as important as understanding that US expansion in the West was not into uninhabited lands.
– Thorbjørn Ravn Andersen
42 mins ago
add a comment |
In this precise moment of this video, (found on this this article) Donald Trump says about Greenland:
It's hurting Denmark very badly because they are losing almost $700m a
year carrying it, so they carry it at a great loss
The fact that Greenland is subsidized by Denmark is on CIA world factbook (inside the "economy" tab):
Greenland’s economy depends on exports of shrimp and fish, and on a
substantial subsidy from the Danish Government. Fish account for over
90% of its exports, subjecting the economy to price fluctuations. The
subsidy from the Danish Government is budgeted to be about $535
million in 2017, more than 50% of government revenues, and 25% of GDP.
Is it fair to say that Denmark has to "carry" Greenland, or do the benefits/profits outweigh the costs?
economics denmark greenland
In this precise moment of this video, (found on this this article) Donald Trump says about Greenland:
It's hurting Denmark very badly because they are losing almost $700m a
year carrying it, so they carry it at a great loss
The fact that Greenland is subsidized by Denmark is on CIA world factbook (inside the "economy" tab):
Greenland’s economy depends on exports of shrimp and fish, and on a
substantial subsidy from the Danish Government. Fish account for over
90% of its exports, subjecting the economy to price fluctuations. The
subsidy from the Danish Government is budgeted to be about $535
million in 2017, more than 50% of government revenues, and 25% of GDP.
Is it fair to say that Denmark has to "carry" Greenland, or do the benefits/profits outweigh the costs?
economics denmark greenland
economics denmark greenland
edited 3 hours ago
Martin Schröder
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In the USA, territories tend to "cost" rather than "payout" or "profit". But even some states "cost" in the same way. Could be a similar thing. It's debatable if that's even the right outlook, but when you're trying to convince someone to sell ...
– fredsbend
53 mins ago
Note that the subsidy is an important factor in allowing Greenlandish "home rule" as opposed to the historical "everything in this colony is ruled from Denmark". Understanding this development is as important as understanding that US expansion in the West was not into uninhabited lands.
– Thorbjørn Ravn Andersen
42 mins ago
add a comment |
In the USA, territories tend to "cost" rather than "payout" or "profit". But even some states "cost" in the same way. Could be a similar thing. It's debatable if that's even the right outlook, but when you're trying to convince someone to sell ...
– fredsbend
53 mins ago
Note that the subsidy is an important factor in allowing Greenlandish "home rule" as opposed to the historical "everything in this colony is ruled from Denmark". Understanding this development is as important as understanding that US expansion in the West was not into uninhabited lands.
– Thorbjørn Ravn Andersen
42 mins ago
In the USA, territories tend to "cost" rather than "payout" or "profit". But even some states "cost" in the same way. Could be a similar thing. It's debatable if that's even the right outlook, but when you're trying to convince someone to sell ...
– fredsbend
53 mins ago
In the USA, territories tend to "cost" rather than "payout" or "profit". But even some states "cost" in the same way. Could be a similar thing. It's debatable if that's even the right outlook, but when you're trying to convince someone to sell ...
– fredsbend
53 mins ago
Note that the subsidy is an important factor in allowing Greenlandish "home rule" as opposed to the historical "everything in this colony is ruled from Denmark". Understanding this development is as important as understanding that US expansion in the West was not into uninhabited lands.
– Thorbjørn Ravn Andersen
42 mins ago
Note that the subsidy is an important factor in allowing Greenlandish "home rule" as opposed to the historical "everything in this colony is ruled from Denmark". Understanding this development is as important as understanding that US expansion in the West was not into uninhabited lands.
– Thorbjørn Ravn Andersen
42 mins ago
add a comment |
3 Answers
3
active
oldest
votes
Trump's claim isn't too far off from the subsidy Denmark pays to Greenland, but it's off by $150 million. Moreover, his characterization of the subsidization as a "loss" misrepresents Greenland's economic value, and drastically overstates the importance of the subsidy to Greenland.
To check the CIA Factbook number, I looked at an government publication of Greenland's statistics (published by Greenland's government). In the Økonomi ("economy") subsection of the Nøgletal ("key figures") section (pages 37-38), the table lists
Bloktilskud 3.722,4 kr. (2017) og 3.822,9 kr. (2018) millioner i tilskud fra Danmark
"Bloktilskud" means "block grants/subsidies", so that in 2018, Denmark gave Greenland 3.8229 billion Danish kroner in aid. Based on current exchange rates, this comes out to $553 million (United States dollars).
$553 million is close enough to $700 million that Trump isn't too far off. So Denmark does subsidize Greenland - but to the tune of about $553 million per year, not $700 million. Moreover, the government statistics do not imply that Denmark is "carrying" Greenland; the total subsidy is equivalent to only 25.5% of Greenland's GNP of $2.17 billion.
In terms of imports and exports, Greenland imported $787 million in 2018, exporting $603 million. The primary trading partners are Denmark and Sweden, although the rest of the EU also trades with Greenland. Denmark's relationship with Greenland, therefore, may be beneficial from a trading standpoint, gaining it money compared to a scenario where the US (or another country) owns Greenland. This is another thing that has to be considered when determining what Denmark gets out of the present setup.
That said, Trump's implication, of course, is that this subsidy is a waste of money for the Danish government. This is nonsensical, as Denmark is merely paying money to maintain an asset. Now, valuing that asset is extremely difficult; the Washington Post writes
So when The Washington Post asked the experts at the Arctic Institute to take a crack, Marc Jacobson, a senior fellow there, put it bluntly: “I’m not aware of any who would be capable” of doing that sort of calculation.
The Post tried several different ways of evaluating what Greenland is worth, and came up with values between $200 million and $1.7 trillion. The latter figure is close to an estimate by Jason Barr based on putative values of Greenland's land. However, land isn't what makes Greenland valuable; instead, its resources do. A fairly comprehensive 2014 report by the Brookings Institute reached several conclusions:
- There is an unknown amount of oil in around Greenland, although exploitation of that is years in the future.
The same holds for precious metals (gold, iron, rare earth elements, etc.):
Greenland is widely believed to hold excellent potential for a host of natural resources, including zinc, lead, gold, iron ore, heavy and light rare earth elements, copper and oil. Considering that only a small fraction of this massive island has been properly explored, in the coming years more data gathering and analysis would be helpful to assess the full potential of Greenland.
Large-scale mining is possible in Greenland, especially if Chinese companies take interest.
. . . because of the slowdown in investments in new mining activities, it is less certain that Greenland will be able to get major mining projects off the ground on the ambitious schedule that it announced in its mineral and energy resource strategy in 2014. We do believe however that eventually large-scale mining will take place in Greenland.
A true estimate of the value of Greenland is impossible until we can determine whether these future developments will occur and how much natural resources Greenland holds. New commodities like river sand are opening up for trade. The crux of the Brookings report is that Greenland has the potential to make a lot of money in the future. Even if Denmark is, at this minute, losing money by owning Greenland, it is impossible to say whether it will reap many more benefits in the decades to come, if development opens up.
1
It's ridiculous to give Trump a pass by saying that $553 million is "almost" $700 million, even ignoring the fact that the subsidy doesn't imply that Denmark is "carrying" Greenland. It would make no sense in any circumstance to round up $553 million to $700 million unless you're an idiot or pathological liar (or both). It would be like saying that the 5 inch fish I caught was almost 11 inches long.
– spacetyper
1 hour ago
1
@spacetyper I disagree with your characterization of it as ridiculous, but I've made an edit that is harsher on the claim. I don't think my answer was giving him a pass, as I had explicitly described the implications of his claim as nonsensical later on.
– HDE 226868
54 mins ago
Thanks for your edits, I think the answer is (appropriately) more critical now.
– spacetyper
48 mins ago
@spacetyper I'm glad. Let me know if you have any other feedback.
– HDE 226868
47 mins ago
3
@spacetyper 5/11 is 45%. 553/700 is 79%. If any characterization here is ridiculous, it's probably yours.
– fredsbend
45 mins ago
|
show 2 more comments
Saying that Denmark is carrying Greenland is like saying that $50 a year renting a safe deposit box is carrying a small metal box that could be bought with a one-time payment of less than that.
Denmark isn't subsidizing a small community of 50,000 people; it is paying for the storage of its wealth.
Greenland contains about 7% of the world's fresh water.
How much is that worth?
With increasing population and pollution, how much will that resource be worth in the future?
How much petroleum is under that ice?
How large are the mineral deposits there?
Saying that Denmark is carrying Greenland is true only in the technical sense of "carrying charges" (an expense or effective cost arising from unproductive assets such as stored goods or unoccupied premises).
New contributor
1
"Greenland contains about 7% of the world's fresh water. " Until it melts. Then who knows how much the resources on the island might be worth. Or not.
– CrossRoads
8 hours ago
@CrossRoads, that's going to take a long time, and by the time there's no more ice left, the oceans will have risen so dramatically that the rest of the world will be a very different place. The displaced people might very well consider the land itself a valuable resource.
– Ray Butterworth
8 hours ago
add a comment |
According to this BBC article from the time of the independence vote, http://news.bbc.co.uk/2/hi/europe/7752660.stm the "block grant" subsidy was fixed at DKK 3.2 billion / year. At today's exchange rate, that's about USD 480 mllion. It is somewhat less than 700.
1
I have two questions: First, does this account for inflation between 2008 and the present; second, has the amount changed in the intervening decade or so? The CIA Factbook figure is 9 years newer. . .
– HDE 226868
9 hours ago
Hmm I first undersd dk.usembassy.gov/our-relationship/u-s-greenland/about-greenland to say the block grant was frozen at the 3.2 level but it does say it would be adjusted for inflation.
– Dimitri Vulis
9 hours ago
This is probably good enough to refute the claim, but is still only half of the equation. Does Denmark gain anything in the form of taxes or other payments?
– Jeff Lambert
9 hours ago
The BBC and other sources say that Denmark contributes "less $$" toward NATO because it "contributes" the Thule military base. I haven't been able to find any concrete numbers.
– Dimitri Vulis
8 hours ago
I found article warontherocks.com/2018/07/… . If Greenland left (and Denmark stopped paying the block grant, then NATO would expect Denmark to spend 2% of its GDP on military.
– Dimitri Vulis
8 hours ago
add a comment |
3 Answers
3
active
oldest
votes
3 Answers
3
active
oldest
votes
active
oldest
votes
active
oldest
votes
Trump's claim isn't too far off from the subsidy Denmark pays to Greenland, but it's off by $150 million. Moreover, his characterization of the subsidization as a "loss" misrepresents Greenland's economic value, and drastically overstates the importance of the subsidy to Greenland.
To check the CIA Factbook number, I looked at an government publication of Greenland's statistics (published by Greenland's government). In the Økonomi ("economy") subsection of the Nøgletal ("key figures") section (pages 37-38), the table lists
Bloktilskud 3.722,4 kr. (2017) og 3.822,9 kr. (2018) millioner i tilskud fra Danmark
"Bloktilskud" means "block grants/subsidies", so that in 2018, Denmark gave Greenland 3.8229 billion Danish kroner in aid. Based on current exchange rates, this comes out to $553 million (United States dollars).
$553 million is close enough to $700 million that Trump isn't too far off. So Denmark does subsidize Greenland - but to the tune of about $553 million per year, not $700 million. Moreover, the government statistics do not imply that Denmark is "carrying" Greenland; the total subsidy is equivalent to only 25.5% of Greenland's GNP of $2.17 billion.
In terms of imports and exports, Greenland imported $787 million in 2018, exporting $603 million. The primary trading partners are Denmark and Sweden, although the rest of the EU also trades with Greenland. Denmark's relationship with Greenland, therefore, may be beneficial from a trading standpoint, gaining it money compared to a scenario where the US (or another country) owns Greenland. This is another thing that has to be considered when determining what Denmark gets out of the present setup.
That said, Trump's implication, of course, is that this subsidy is a waste of money for the Danish government. This is nonsensical, as Denmark is merely paying money to maintain an asset. Now, valuing that asset is extremely difficult; the Washington Post writes
So when The Washington Post asked the experts at the Arctic Institute to take a crack, Marc Jacobson, a senior fellow there, put it bluntly: “I’m not aware of any who would be capable” of doing that sort of calculation.
The Post tried several different ways of evaluating what Greenland is worth, and came up with values between $200 million and $1.7 trillion. The latter figure is close to an estimate by Jason Barr based on putative values of Greenland's land. However, land isn't what makes Greenland valuable; instead, its resources do. A fairly comprehensive 2014 report by the Brookings Institute reached several conclusions:
- There is an unknown amount of oil in around Greenland, although exploitation of that is years in the future.
The same holds for precious metals (gold, iron, rare earth elements, etc.):
Greenland is widely believed to hold excellent potential for a host of natural resources, including zinc, lead, gold, iron ore, heavy and light rare earth elements, copper and oil. Considering that only a small fraction of this massive island has been properly explored, in the coming years more data gathering and analysis would be helpful to assess the full potential of Greenland.
Large-scale mining is possible in Greenland, especially if Chinese companies take interest.
. . . because of the slowdown in investments in new mining activities, it is less certain that Greenland will be able to get major mining projects off the ground on the ambitious schedule that it announced in its mineral and energy resource strategy in 2014. We do believe however that eventually large-scale mining will take place in Greenland.
A true estimate of the value of Greenland is impossible until we can determine whether these future developments will occur and how much natural resources Greenland holds. New commodities like river sand are opening up for trade. The crux of the Brookings report is that Greenland has the potential to make a lot of money in the future. Even if Denmark is, at this minute, losing money by owning Greenland, it is impossible to say whether it will reap many more benefits in the decades to come, if development opens up.
1
It's ridiculous to give Trump a pass by saying that $553 million is "almost" $700 million, even ignoring the fact that the subsidy doesn't imply that Denmark is "carrying" Greenland. It would make no sense in any circumstance to round up $553 million to $700 million unless you're an idiot or pathological liar (or both). It would be like saying that the 5 inch fish I caught was almost 11 inches long.
– spacetyper
1 hour ago
1
@spacetyper I disagree with your characterization of it as ridiculous, but I've made an edit that is harsher on the claim. I don't think my answer was giving him a pass, as I had explicitly described the implications of his claim as nonsensical later on.
– HDE 226868
54 mins ago
Thanks for your edits, I think the answer is (appropriately) more critical now.
– spacetyper
48 mins ago
@spacetyper I'm glad. Let me know if you have any other feedback.
– HDE 226868
47 mins ago
3
@spacetyper 5/11 is 45%. 553/700 is 79%. If any characterization here is ridiculous, it's probably yours.
– fredsbend
45 mins ago
|
show 2 more comments
Trump's claim isn't too far off from the subsidy Denmark pays to Greenland, but it's off by $150 million. Moreover, his characterization of the subsidization as a "loss" misrepresents Greenland's economic value, and drastically overstates the importance of the subsidy to Greenland.
To check the CIA Factbook number, I looked at an government publication of Greenland's statistics (published by Greenland's government). In the Økonomi ("economy") subsection of the Nøgletal ("key figures") section (pages 37-38), the table lists
Bloktilskud 3.722,4 kr. (2017) og 3.822,9 kr. (2018) millioner i tilskud fra Danmark
"Bloktilskud" means "block grants/subsidies", so that in 2018, Denmark gave Greenland 3.8229 billion Danish kroner in aid. Based on current exchange rates, this comes out to $553 million (United States dollars).
$553 million is close enough to $700 million that Trump isn't too far off. So Denmark does subsidize Greenland - but to the tune of about $553 million per year, not $700 million. Moreover, the government statistics do not imply that Denmark is "carrying" Greenland; the total subsidy is equivalent to only 25.5% of Greenland's GNP of $2.17 billion.
In terms of imports and exports, Greenland imported $787 million in 2018, exporting $603 million. The primary trading partners are Denmark and Sweden, although the rest of the EU also trades with Greenland. Denmark's relationship with Greenland, therefore, may be beneficial from a trading standpoint, gaining it money compared to a scenario where the US (or another country) owns Greenland. This is another thing that has to be considered when determining what Denmark gets out of the present setup.
That said, Trump's implication, of course, is that this subsidy is a waste of money for the Danish government. This is nonsensical, as Denmark is merely paying money to maintain an asset. Now, valuing that asset is extremely difficult; the Washington Post writes
So when The Washington Post asked the experts at the Arctic Institute to take a crack, Marc Jacobson, a senior fellow there, put it bluntly: “I’m not aware of any who would be capable” of doing that sort of calculation.
The Post tried several different ways of evaluating what Greenland is worth, and came up with values between $200 million and $1.7 trillion. The latter figure is close to an estimate by Jason Barr based on putative values of Greenland's land. However, land isn't what makes Greenland valuable; instead, its resources do. A fairly comprehensive 2014 report by the Brookings Institute reached several conclusions:
- There is an unknown amount of oil in around Greenland, although exploitation of that is years in the future.
The same holds for precious metals (gold, iron, rare earth elements, etc.):
Greenland is widely believed to hold excellent potential for a host of natural resources, including zinc, lead, gold, iron ore, heavy and light rare earth elements, copper and oil. Considering that only a small fraction of this massive island has been properly explored, in the coming years more data gathering and analysis would be helpful to assess the full potential of Greenland.
Large-scale mining is possible in Greenland, especially if Chinese companies take interest.
. . . because of the slowdown in investments in new mining activities, it is less certain that Greenland will be able to get major mining projects off the ground on the ambitious schedule that it announced in its mineral and energy resource strategy in 2014. We do believe however that eventually large-scale mining will take place in Greenland.
A true estimate of the value of Greenland is impossible until we can determine whether these future developments will occur and how much natural resources Greenland holds. New commodities like river sand are opening up for trade. The crux of the Brookings report is that Greenland has the potential to make a lot of money in the future. Even if Denmark is, at this minute, losing money by owning Greenland, it is impossible to say whether it will reap many more benefits in the decades to come, if development opens up.
1
It's ridiculous to give Trump a pass by saying that $553 million is "almost" $700 million, even ignoring the fact that the subsidy doesn't imply that Denmark is "carrying" Greenland. It would make no sense in any circumstance to round up $553 million to $700 million unless you're an idiot or pathological liar (or both). It would be like saying that the 5 inch fish I caught was almost 11 inches long.
– spacetyper
1 hour ago
1
@spacetyper I disagree with your characterization of it as ridiculous, but I've made an edit that is harsher on the claim. I don't think my answer was giving him a pass, as I had explicitly described the implications of his claim as nonsensical later on.
– HDE 226868
54 mins ago
Thanks for your edits, I think the answer is (appropriately) more critical now.
– spacetyper
48 mins ago
@spacetyper I'm glad. Let me know if you have any other feedback.
– HDE 226868
47 mins ago
3
@spacetyper 5/11 is 45%. 553/700 is 79%. If any characterization here is ridiculous, it's probably yours.
– fredsbend
45 mins ago
|
show 2 more comments
Trump's claim isn't too far off from the subsidy Denmark pays to Greenland, but it's off by $150 million. Moreover, his characterization of the subsidization as a "loss" misrepresents Greenland's economic value, and drastically overstates the importance of the subsidy to Greenland.
To check the CIA Factbook number, I looked at an government publication of Greenland's statistics (published by Greenland's government). In the Økonomi ("economy") subsection of the Nøgletal ("key figures") section (pages 37-38), the table lists
Bloktilskud 3.722,4 kr. (2017) og 3.822,9 kr. (2018) millioner i tilskud fra Danmark
"Bloktilskud" means "block grants/subsidies", so that in 2018, Denmark gave Greenland 3.8229 billion Danish kroner in aid. Based on current exchange rates, this comes out to $553 million (United States dollars).
$553 million is close enough to $700 million that Trump isn't too far off. So Denmark does subsidize Greenland - but to the tune of about $553 million per year, not $700 million. Moreover, the government statistics do not imply that Denmark is "carrying" Greenland; the total subsidy is equivalent to only 25.5% of Greenland's GNP of $2.17 billion.
In terms of imports and exports, Greenland imported $787 million in 2018, exporting $603 million. The primary trading partners are Denmark and Sweden, although the rest of the EU also trades with Greenland. Denmark's relationship with Greenland, therefore, may be beneficial from a trading standpoint, gaining it money compared to a scenario where the US (or another country) owns Greenland. This is another thing that has to be considered when determining what Denmark gets out of the present setup.
That said, Trump's implication, of course, is that this subsidy is a waste of money for the Danish government. This is nonsensical, as Denmark is merely paying money to maintain an asset. Now, valuing that asset is extremely difficult; the Washington Post writes
So when The Washington Post asked the experts at the Arctic Institute to take a crack, Marc Jacobson, a senior fellow there, put it bluntly: “I’m not aware of any who would be capable” of doing that sort of calculation.
The Post tried several different ways of evaluating what Greenland is worth, and came up with values between $200 million and $1.7 trillion. The latter figure is close to an estimate by Jason Barr based on putative values of Greenland's land. However, land isn't what makes Greenland valuable; instead, its resources do. A fairly comprehensive 2014 report by the Brookings Institute reached several conclusions:
- There is an unknown amount of oil in around Greenland, although exploitation of that is years in the future.
The same holds for precious metals (gold, iron, rare earth elements, etc.):
Greenland is widely believed to hold excellent potential for a host of natural resources, including zinc, lead, gold, iron ore, heavy and light rare earth elements, copper and oil. Considering that only a small fraction of this massive island has been properly explored, in the coming years more data gathering and analysis would be helpful to assess the full potential of Greenland.
Large-scale mining is possible in Greenland, especially if Chinese companies take interest.
. . . because of the slowdown in investments in new mining activities, it is less certain that Greenland will be able to get major mining projects off the ground on the ambitious schedule that it announced in its mineral and energy resource strategy in 2014. We do believe however that eventually large-scale mining will take place in Greenland.
A true estimate of the value of Greenland is impossible until we can determine whether these future developments will occur and how much natural resources Greenland holds. New commodities like river sand are opening up for trade. The crux of the Brookings report is that Greenland has the potential to make a lot of money in the future. Even if Denmark is, at this minute, losing money by owning Greenland, it is impossible to say whether it will reap many more benefits in the decades to come, if development opens up.
Trump's claim isn't too far off from the subsidy Denmark pays to Greenland, but it's off by $150 million. Moreover, his characterization of the subsidization as a "loss" misrepresents Greenland's economic value, and drastically overstates the importance of the subsidy to Greenland.
To check the CIA Factbook number, I looked at an government publication of Greenland's statistics (published by Greenland's government). In the Økonomi ("economy") subsection of the Nøgletal ("key figures") section (pages 37-38), the table lists
Bloktilskud 3.722,4 kr. (2017) og 3.822,9 kr. (2018) millioner i tilskud fra Danmark
"Bloktilskud" means "block grants/subsidies", so that in 2018, Denmark gave Greenland 3.8229 billion Danish kroner in aid. Based on current exchange rates, this comes out to $553 million (United States dollars).
$553 million is close enough to $700 million that Trump isn't too far off. So Denmark does subsidize Greenland - but to the tune of about $553 million per year, not $700 million. Moreover, the government statistics do not imply that Denmark is "carrying" Greenland; the total subsidy is equivalent to only 25.5% of Greenland's GNP of $2.17 billion.
In terms of imports and exports, Greenland imported $787 million in 2018, exporting $603 million. The primary trading partners are Denmark and Sweden, although the rest of the EU also trades with Greenland. Denmark's relationship with Greenland, therefore, may be beneficial from a trading standpoint, gaining it money compared to a scenario where the US (or another country) owns Greenland. This is another thing that has to be considered when determining what Denmark gets out of the present setup.
That said, Trump's implication, of course, is that this subsidy is a waste of money for the Danish government. This is nonsensical, as Denmark is merely paying money to maintain an asset. Now, valuing that asset is extremely difficult; the Washington Post writes
So when The Washington Post asked the experts at the Arctic Institute to take a crack, Marc Jacobson, a senior fellow there, put it bluntly: “I’m not aware of any who would be capable” of doing that sort of calculation.
The Post tried several different ways of evaluating what Greenland is worth, and came up with values between $200 million and $1.7 trillion. The latter figure is close to an estimate by Jason Barr based on putative values of Greenland's land. However, land isn't what makes Greenland valuable; instead, its resources do. A fairly comprehensive 2014 report by the Brookings Institute reached several conclusions:
- There is an unknown amount of oil in around Greenland, although exploitation of that is years in the future.
The same holds for precious metals (gold, iron, rare earth elements, etc.):
Greenland is widely believed to hold excellent potential for a host of natural resources, including zinc, lead, gold, iron ore, heavy and light rare earth elements, copper and oil. Considering that only a small fraction of this massive island has been properly explored, in the coming years more data gathering and analysis would be helpful to assess the full potential of Greenland.
Large-scale mining is possible in Greenland, especially if Chinese companies take interest.
. . . because of the slowdown in investments in new mining activities, it is less certain that Greenland will be able to get major mining projects off the ground on the ambitious schedule that it announced in its mineral and energy resource strategy in 2014. We do believe however that eventually large-scale mining will take place in Greenland.
A true estimate of the value of Greenland is impossible until we can determine whether these future developments will occur and how much natural resources Greenland holds. New commodities like river sand are opening up for trade. The crux of the Brookings report is that Greenland has the potential to make a lot of money in the future. Even if Denmark is, at this minute, losing money by owning Greenland, it is impossible to say whether it will reap many more benefits in the decades to come, if development opens up.
edited 6 mins ago
answered 8 hours ago
HDE 226868HDE 226868
6,4901 gold badge42 silver badges53 bronze badges
6,4901 gold badge42 silver badges53 bronze badges
1
It's ridiculous to give Trump a pass by saying that $553 million is "almost" $700 million, even ignoring the fact that the subsidy doesn't imply that Denmark is "carrying" Greenland. It would make no sense in any circumstance to round up $553 million to $700 million unless you're an idiot or pathological liar (or both). It would be like saying that the 5 inch fish I caught was almost 11 inches long.
– spacetyper
1 hour ago
1
@spacetyper I disagree with your characterization of it as ridiculous, but I've made an edit that is harsher on the claim. I don't think my answer was giving him a pass, as I had explicitly described the implications of his claim as nonsensical later on.
– HDE 226868
54 mins ago
Thanks for your edits, I think the answer is (appropriately) more critical now.
– spacetyper
48 mins ago
@spacetyper I'm glad. Let me know if you have any other feedback.
– HDE 226868
47 mins ago
3
@spacetyper 5/11 is 45%. 553/700 is 79%. If any characterization here is ridiculous, it's probably yours.
– fredsbend
45 mins ago
|
show 2 more comments
1
It's ridiculous to give Trump a pass by saying that $553 million is "almost" $700 million, even ignoring the fact that the subsidy doesn't imply that Denmark is "carrying" Greenland. It would make no sense in any circumstance to round up $553 million to $700 million unless you're an idiot or pathological liar (or both). It would be like saying that the 5 inch fish I caught was almost 11 inches long.
– spacetyper
1 hour ago
1
@spacetyper I disagree with your characterization of it as ridiculous, but I've made an edit that is harsher on the claim. I don't think my answer was giving him a pass, as I had explicitly described the implications of his claim as nonsensical later on.
– HDE 226868
54 mins ago
Thanks for your edits, I think the answer is (appropriately) more critical now.
– spacetyper
48 mins ago
@spacetyper I'm glad. Let me know if you have any other feedback.
– HDE 226868
47 mins ago
3
@spacetyper 5/11 is 45%. 553/700 is 79%. If any characterization here is ridiculous, it's probably yours.
– fredsbend
45 mins ago
1
1
It's ridiculous to give Trump a pass by saying that $553 million is "almost" $700 million, even ignoring the fact that the subsidy doesn't imply that Denmark is "carrying" Greenland. It would make no sense in any circumstance to round up $553 million to $700 million unless you're an idiot or pathological liar (or both). It would be like saying that the 5 inch fish I caught was almost 11 inches long.
– spacetyper
1 hour ago
It's ridiculous to give Trump a pass by saying that $553 million is "almost" $700 million, even ignoring the fact that the subsidy doesn't imply that Denmark is "carrying" Greenland. It would make no sense in any circumstance to round up $553 million to $700 million unless you're an idiot or pathological liar (or both). It would be like saying that the 5 inch fish I caught was almost 11 inches long.
– spacetyper
1 hour ago
1
1
@spacetyper I disagree with your characterization of it as ridiculous, but I've made an edit that is harsher on the claim. I don't think my answer was giving him a pass, as I had explicitly described the implications of his claim as nonsensical later on.
– HDE 226868
54 mins ago
@spacetyper I disagree with your characterization of it as ridiculous, but I've made an edit that is harsher on the claim. I don't think my answer was giving him a pass, as I had explicitly described the implications of his claim as nonsensical later on.
– HDE 226868
54 mins ago
Thanks for your edits, I think the answer is (appropriately) more critical now.
– spacetyper
48 mins ago
Thanks for your edits, I think the answer is (appropriately) more critical now.
– spacetyper
48 mins ago
@spacetyper I'm glad. Let me know if you have any other feedback.
– HDE 226868
47 mins ago
@spacetyper I'm glad. Let me know if you have any other feedback.
– HDE 226868
47 mins ago
3
3
@spacetyper 5/11 is 45%. 553/700 is 79%. If any characterization here is ridiculous, it's probably yours.
– fredsbend
45 mins ago
@spacetyper 5/11 is 45%. 553/700 is 79%. If any characterization here is ridiculous, it's probably yours.
– fredsbend
45 mins ago
|
show 2 more comments
Saying that Denmark is carrying Greenland is like saying that $50 a year renting a safe deposit box is carrying a small metal box that could be bought with a one-time payment of less than that.
Denmark isn't subsidizing a small community of 50,000 people; it is paying for the storage of its wealth.
Greenland contains about 7% of the world's fresh water.
How much is that worth?
With increasing population and pollution, how much will that resource be worth in the future?
How much petroleum is under that ice?
How large are the mineral deposits there?
Saying that Denmark is carrying Greenland is true only in the technical sense of "carrying charges" (an expense or effective cost arising from unproductive assets such as stored goods or unoccupied premises).
New contributor
1
"Greenland contains about 7% of the world's fresh water. " Until it melts. Then who knows how much the resources on the island might be worth. Or not.
– CrossRoads
8 hours ago
@CrossRoads, that's going to take a long time, and by the time there's no more ice left, the oceans will have risen so dramatically that the rest of the world will be a very different place. The displaced people might very well consider the land itself a valuable resource.
– Ray Butterworth
8 hours ago
add a comment |
Saying that Denmark is carrying Greenland is like saying that $50 a year renting a safe deposit box is carrying a small metal box that could be bought with a one-time payment of less than that.
Denmark isn't subsidizing a small community of 50,000 people; it is paying for the storage of its wealth.
Greenland contains about 7% of the world's fresh water.
How much is that worth?
With increasing population and pollution, how much will that resource be worth in the future?
How much petroleum is under that ice?
How large are the mineral deposits there?
Saying that Denmark is carrying Greenland is true only in the technical sense of "carrying charges" (an expense or effective cost arising from unproductive assets such as stored goods or unoccupied premises).
New contributor
1
"Greenland contains about 7% of the world's fresh water. " Until it melts. Then who knows how much the resources on the island might be worth. Or not.
– CrossRoads
8 hours ago
@CrossRoads, that's going to take a long time, and by the time there's no more ice left, the oceans will have risen so dramatically that the rest of the world will be a very different place. The displaced people might very well consider the land itself a valuable resource.
– Ray Butterworth
8 hours ago
add a comment |
Saying that Denmark is carrying Greenland is like saying that $50 a year renting a safe deposit box is carrying a small metal box that could be bought with a one-time payment of less than that.
Denmark isn't subsidizing a small community of 50,000 people; it is paying for the storage of its wealth.
Greenland contains about 7% of the world's fresh water.
How much is that worth?
With increasing population and pollution, how much will that resource be worth in the future?
How much petroleum is under that ice?
How large are the mineral deposits there?
Saying that Denmark is carrying Greenland is true only in the technical sense of "carrying charges" (an expense or effective cost arising from unproductive assets such as stored goods or unoccupied premises).
New contributor
Saying that Denmark is carrying Greenland is like saying that $50 a year renting a safe deposit box is carrying a small metal box that could be bought with a one-time payment of less than that.
Denmark isn't subsidizing a small community of 50,000 people; it is paying for the storage of its wealth.
Greenland contains about 7% of the world's fresh water.
How much is that worth?
With increasing population and pollution, how much will that resource be worth in the future?
How much petroleum is under that ice?
How large are the mineral deposits there?
Saying that Denmark is carrying Greenland is true only in the technical sense of "carrying charges" (an expense or effective cost arising from unproductive assets such as stored goods or unoccupied premises).
New contributor
New contributor
answered 8 hours ago
Ray ButterworthRay Butterworth
2211 silver badge6 bronze badges
2211 silver badge6 bronze badges
New contributor
New contributor
1
"Greenland contains about 7% of the world's fresh water. " Until it melts. Then who knows how much the resources on the island might be worth. Or not.
– CrossRoads
8 hours ago
@CrossRoads, that's going to take a long time, and by the time there's no more ice left, the oceans will have risen so dramatically that the rest of the world will be a very different place. The displaced people might very well consider the land itself a valuable resource.
– Ray Butterworth
8 hours ago
add a comment |
1
"Greenland contains about 7% of the world's fresh water. " Until it melts. Then who knows how much the resources on the island might be worth. Or not.
– CrossRoads
8 hours ago
@CrossRoads, that's going to take a long time, and by the time there's no more ice left, the oceans will have risen so dramatically that the rest of the world will be a very different place. The displaced people might very well consider the land itself a valuable resource.
– Ray Butterworth
8 hours ago
1
1
"Greenland contains about 7% of the world's fresh water. " Until it melts. Then who knows how much the resources on the island might be worth. Or not.
– CrossRoads
8 hours ago
"Greenland contains about 7% of the world's fresh water. " Until it melts. Then who knows how much the resources on the island might be worth. Or not.
– CrossRoads
8 hours ago
@CrossRoads, that's going to take a long time, and by the time there's no more ice left, the oceans will have risen so dramatically that the rest of the world will be a very different place. The displaced people might very well consider the land itself a valuable resource.
– Ray Butterworth
8 hours ago
@CrossRoads, that's going to take a long time, and by the time there's no more ice left, the oceans will have risen so dramatically that the rest of the world will be a very different place. The displaced people might very well consider the land itself a valuable resource.
– Ray Butterworth
8 hours ago
add a comment |
According to this BBC article from the time of the independence vote, http://news.bbc.co.uk/2/hi/europe/7752660.stm the "block grant" subsidy was fixed at DKK 3.2 billion / year. At today's exchange rate, that's about USD 480 mllion. It is somewhat less than 700.
1
I have two questions: First, does this account for inflation between 2008 and the present; second, has the amount changed in the intervening decade or so? The CIA Factbook figure is 9 years newer. . .
– HDE 226868
9 hours ago
Hmm I first undersd dk.usembassy.gov/our-relationship/u-s-greenland/about-greenland to say the block grant was frozen at the 3.2 level but it does say it would be adjusted for inflation.
– Dimitri Vulis
9 hours ago
This is probably good enough to refute the claim, but is still only half of the equation. Does Denmark gain anything in the form of taxes or other payments?
– Jeff Lambert
9 hours ago
The BBC and other sources say that Denmark contributes "less $$" toward NATO because it "contributes" the Thule military base. I haven't been able to find any concrete numbers.
– Dimitri Vulis
8 hours ago
I found article warontherocks.com/2018/07/… . If Greenland left (and Denmark stopped paying the block grant, then NATO would expect Denmark to spend 2% of its GDP on military.
– Dimitri Vulis
8 hours ago
add a comment |
According to this BBC article from the time of the independence vote, http://news.bbc.co.uk/2/hi/europe/7752660.stm the "block grant" subsidy was fixed at DKK 3.2 billion / year. At today's exchange rate, that's about USD 480 mllion. It is somewhat less than 700.
1
I have two questions: First, does this account for inflation between 2008 and the present; second, has the amount changed in the intervening decade or so? The CIA Factbook figure is 9 years newer. . .
– HDE 226868
9 hours ago
Hmm I first undersd dk.usembassy.gov/our-relationship/u-s-greenland/about-greenland to say the block grant was frozen at the 3.2 level but it does say it would be adjusted for inflation.
– Dimitri Vulis
9 hours ago
This is probably good enough to refute the claim, but is still only half of the equation. Does Denmark gain anything in the form of taxes or other payments?
– Jeff Lambert
9 hours ago
The BBC and other sources say that Denmark contributes "less $$" toward NATO because it "contributes" the Thule military base. I haven't been able to find any concrete numbers.
– Dimitri Vulis
8 hours ago
I found article warontherocks.com/2018/07/… . If Greenland left (and Denmark stopped paying the block grant, then NATO would expect Denmark to spend 2% of its GDP on military.
– Dimitri Vulis
8 hours ago
add a comment |
According to this BBC article from the time of the independence vote, http://news.bbc.co.uk/2/hi/europe/7752660.stm the "block grant" subsidy was fixed at DKK 3.2 billion / year. At today's exchange rate, that's about USD 480 mllion. It is somewhat less than 700.
According to this BBC article from the time of the independence vote, http://news.bbc.co.uk/2/hi/europe/7752660.stm the "block grant" subsidy was fixed at DKK 3.2 billion / year. At today's exchange rate, that's about USD 480 mllion. It is somewhat less than 700.
answered 9 hours ago
Dimitri VulisDimitri Vulis
4391 silver badge7 bronze badges
4391 silver badge7 bronze badges
1
I have two questions: First, does this account for inflation between 2008 and the present; second, has the amount changed in the intervening decade or so? The CIA Factbook figure is 9 years newer. . .
– HDE 226868
9 hours ago
Hmm I first undersd dk.usembassy.gov/our-relationship/u-s-greenland/about-greenland to say the block grant was frozen at the 3.2 level but it does say it would be adjusted for inflation.
– Dimitri Vulis
9 hours ago
This is probably good enough to refute the claim, but is still only half of the equation. Does Denmark gain anything in the form of taxes or other payments?
– Jeff Lambert
9 hours ago
The BBC and other sources say that Denmark contributes "less $$" toward NATO because it "contributes" the Thule military base. I haven't been able to find any concrete numbers.
– Dimitri Vulis
8 hours ago
I found article warontherocks.com/2018/07/… . If Greenland left (and Denmark stopped paying the block grant, then NATO would expect Denmark to spend 2% of its GDP on military.
– Dimitri Vulis
8 hours ago
add a comment |
1
I have two questions: First, does this account for inflation between 2008 and the present; second, has the amount changed in the intervening decade or so? The CIA Factbook figure is 9 years newer. . .
– HDE 226868
9 hours ago
Hmm I first undersd dk.usembassy.gov/our-relationship/u-s-greenland/about-greenland to say the block grant was frozen at the 3.2 level but it does say it would be adjusted for inflation.
– Dimitri Vulis
9 hours ago
This is probably good enough to refute the claim, but is still only half of the equation. Does Denmark gain anything in the form of taxes or other payments?
– Jeff Lambert
9 hours ago
The BBC and other sources say that Denmark contributes "less $$" toward NATO because it "contributes" the Thule military base. I haven't been able to find any concrete numbers.
– Dimitri Vulis
8 hours ago
I found article warontherocks.com/2018/07/… . If Greenland left (and Denmark stopped paying the block grant, then NATO would expect Denmark to spend 2% of its GDP on military.
– Dimitri Vulis
8 hours ago
1
1
I have two questions: First, does this account for inflation between 2008 and the present; second, has the amount changed in the intervening decade or so? The CIA Factbook figure is 9 years newer. . .
– HDE 226868
9 hours ago
I have two questions: First, does this account for inflation between 2008 and the present; second, has the amount changed in the intervening decade or so? The CIA Factbook figure is 9 years newer. . .
– HDE 226868
9 hours ago
Hmm I first undersd dk.usembassy.gov/our-relationship/u-s-greenland/about-greenland to say the block grant was frozen at the 3.2 level but it does say it would be adjusted for inflation.
– Dimitri Vulis
9 hours ago
Hmm I first undersd dk.usembassy.gov/our-relationship/u-s-greenland/about-greenland to say the block grant was frozen at the 3.2 level but it does say it would be adjusted for inflation.
– Dimitri Vulis
9 hours ago
This is probably good enough to refute the claim, but is still only half of the equation. Does Denmark gain anything in the form of taxes or other payments?
– Jeff Lambert
9 hours ago
This is probably good enough to refute the claim, but is still only half of the equation. Does Denmark gain anything in the form of taxes or other payments?
– Jeff Lambert
9 hours ago
The BBC and other sources say that Denmark contributes "less $$" toward NATO because it "contributes" the Thule military base. I haven't been able to find any concrete numbers.
– Dimitri Vulis
8 hours ago
The BBC and other sources say that Denmark contributes "less $$" toward NATO because it "contributes" the Thule military base. I haven't been able to find any concrete numbers.
– Dimitri Vulis
8 hours ago
I found article warontherocks.com/2018/07/… . If Greenland left (and Denmark stopped paying the block grant, then NATO would expect Denmark to spend 2% of its GDP on military.
– Dimitri Vulis
8 hours ago
I found article warontherocks.com/2018/07/… . If Greenland left (and Denmark stopped paying the block grant, then NATO would expect Denmark to spend 2% of its GDP on military.
– Dimitri Vulis
8 hours ago
add a comment |
In the USA, territories tend to "cost" rather than "payout" or "profit". But even some states "cost" in the same way. Could be a similar thing. It's debatable if that's even the right outlook, but when you're trying to convince someone to sell ...
– fredsbend
53 mins ago
Note that the subsidy is an important factor in allowing Greenlandish "home rule" as opposed to the historical "everything in this colony is ruled from Denmark". Understanding this development is as important as understanding that US expansion in the West was not into uninhabited lands.
– Thorbjørn Ravn Andersen
42 mins ago