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Short answer: No. That was actually a contentious political decision at the time, although this fact has been airbrushed from the official version of history.

Slightly longer answer: Denmark joined Bretton Woods, just like the rest of The WestTM. When Bretton Woods crashed, we tried to maintain a D-Mark peg, but had a decade of regular devaluations against it.

Of course devaluing and then attempting to defend the new exchange rate is just asking to be attacked. What we should have done was to float our currency. What we did instead was elect a right-wing economic hit man who enforced the D-Mark peg to the exclusion of all sensible macroeconomic concerns. Right on cue, this caused our productive economy to crater and the FIRE sector to blow a huge bubble all over the first half of the 1980s.

Somehow the 1980 decision to go for broke on the peg rather than abandon it has been anointed as the greatest act of wisdom in recent Danish economic history - rather than the gross act of irresponsible industrial sabotage it actually was.

- Jake

Austerity can only be implemented in the shadow of a concentration camp.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Wed Aug 10th, 2011 at 07:46:33 PM EST
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