Can Greenland afford to join the US? Addressing Congress in March 2025, President Donald Trump promised Greenland's citizens: "We will keep you safe, we will make you rich, and together, we will take Greenland to heights like you have never thought possible before."
In reality, economic growth in Denmark has generally surpassed growth in the US since before the COVID-19 pandemic, except for the mild dip in 2023-2024 (panel a). This growth has enabled Denmark to undertake massive fiscal transfers to its autonomous Arctic territory. Since 2020, Denmark has run a cumulative general government fiscal surplus of 18.6 percent of GDP (positive net lending), while the US has run a general government (federal, state and, local levels) deficit of 53.8 percent of GDP (negative net lending) (panel b).
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