First, the Northern Europeans are focused on building strong national and local institutions that can make markets and drive societal benefits, not just change policy. Cities like Copenhagen and Hamburg, for example, have created public asset corporations that dispose of publicly owned lands and buildings in ways that spur large-scale urban transformation, particularly around historic harbors and downtowns. The revenue from such regeneration is then used to fund infrastructure, affordable housing, and other societal benefits. These regeneration efforts show a mature balance between public- and private-sector interests—a stark contrast to the tax-break scramble over landing Amazon’s HQ2, or New York City’s Hudson Yards private megaproject. [...]
Second, the Northern Europeans are devolutionists—they use the nation-state to provide a platform for local market realities, political priorities, and social needs. Denmark, for example, has a decentralized government system, enabling municipalities to operate as strong partners with the national government. According to a 2009 OECD review, local governments in Denmark account for over 60 percent of government spending, the highest level among OECD peers. Copenhagen’s ambition to be the first major global city to generate zero carbon emissions is enabled by a strong fiscal foundation, coupled with mechanisms that give local officials input in national policy that would be unprecedented in the United States.
Along with that local power and legitimacy comes more voter participation: While the U.S. suffers from voter turnout of 20 percent or less in local elections, Copenhagen has consistently experienced turnout of 70 percent. Accordingly, local capacity is likewise strong. The knowledge and decision-making capacity of the public sector is robust, with a steady supply of highly educated public servants across technical, environmental, social, and business fields. The supply stems from the free tuition public sector educational system (which also greatly benefits the private sector).
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