During the Danish local and national elections in November 2001, the scale, intensity and tone of the debates on migration took both national and international commentators by surprise. Within the first year of the new right‐wing government, supported by the influential Danish People’s Party, Denmark has become one of the most exclusive and restrictive immigration regimes in Europe. This article takes a closer look at the recent politicization of migration issues in Denmark. While there is certainly concern with the compatibility of migrant ‘otherness’, in particular Islam, with Danish society and norms, then an equally, or even more central issue regards the ‘cost of migration’ for Danish social policy standards. Because of high unemployment rates, migrants and their descendants receive a relatively large part of Danish social contributions. This has raised the more general question of how to combine immigration with a tax‐financed universal welfare system where all have rights to full social benefits immediately upon arrival. The answer of the government has been to cut both sides of the equation by implementing stricter entry rules for family reunification and asylum‐seekers, as well as making a historical break with the principle of equal social welfare benefits for all legal residents.