As others and I have noted before, the EEU with its Democratic Socialism is clearly where Obama and liberal Democrats want to take the country, in spite of little or no constitutional justification. They, and most of the media ignore the lesson of where European-style socialism has taken much of western Europe (e.g. Greece, Portugal, Ireland). Huge deficits which can only be remedied by austerity cuts which bring out riots, destruction, etc. The philosophy seems to be "full speed ahead, damn the economic realities and the European experience." Spain may be the next casualty. However, the stakes are even higher for Spain.
Showing posts with label EEU. Show all posts
Showing posts with label EEU. Show all posts
The lessons of Greece, Portugal, Ireland, Italy and California for the U.S.
Over a century ago, I think it was de Tocqueville who quipped that democracy would work well in America until politicians figured out they can buy votes with benefits, programs, etc. We hit that point a long time back, and both liberals and conservatives have been guilty. Left-wing Democrats and Obama, however, are the most culpable so far.
Look at the patterns for the economic problems in Western Europe and many places in the U.S. such as California. In Europe, Italy is the latest (following Greece, Ireland and Portugal) to go into a financial crisis.
It is not rocket science to figure out how this happens on the city, state and national levels. Politicians offer high wages, generous retirements to government employees. Government lowers the retirement age and promises big benefits. Government employees and their unions, become strong political supporters.The poor a given handouts rather than real opportunities to improve their lot. The government really doesn't want these folks to become successful. Once their dependence on handouts end, they no longer need those politicians. The public slowly gets drawn in with programs. Anyone who hints that benefits, salaries, etc. might have to be cut will not get elected. The politician with the best handout package is likely to get elected. The deficits balloons and default and bankruptcy become likely. The government responds with job-creation programs that only exacerbate the deficit and creates no long-term jobs. Domestic and foreign investors get nervous and cut back. With no private sector investment, no jobs are resuscitated and no new jobs are created. Government bond ratings go down and the issuers have to raise the interest rates to get new borrowers. Leftists try to play the race card and the politics of envy. They blame corporations and Wall Street, when it's government that started and created the basic mess. It's a vicious circle. Austerity programs bring discontent and rioting. You don't have to be a genius to see that this is where the U.S. is headed. You can argue that this will not happen to the world's largest economy. However, when will China become the world's largest and most powerful economy and then the U.S. has to dance to all the Chinese, Saudi and other U.S. debt buyers? The handwriting is on the wall! If you can't figure out who to vote against in the 2012 presidential elections, there's no hope for you. However, it goes beyond that, vote for people with some realistic understanding of real world economics. As the Trojans said "beware of Greeks bearing gifts."
Look at the patterns for the economic problems in Western Europe and many places in the U.S. such as California. In Europe, Italy is the latest (following Greece, Ireland and Portugal) to go into a financial crisis.
It is not rocket science to figure out how this happens on the city, state and national levels. Politicians offer high wages, generous retirements to government employees. Government lowers the retirement age and promises big benefits. Government employees and their unions, become strong political supporters.The poor a given handouts rather than real opportunities to improve their lot. The government really doesn't want these folks to become successful. Once their dependence on handouts end, they no longer need those politicians. The public slowly gets drawn in with programs. Anyone who hints that benefits, salaries, etc. might have to be cut will not get elected. The politician with the best handout package is likely to get elected. The deficits balloons and default and bankruptcy become likely. The government responds with job-creation programs that only exacerbate the deficit and creates no long-term jobs. Domestic and foreign investors get nervous and cut back. With no private sector investment, no jobs are resuscitated and no new jobs are created. Government bond ratings go down and the issuers have to raise the interest rates to get new borrowers. Leftists try to play the race card and the politics of envy. They blame corporations and Wall Street, when it's government that started and created the basic mess. It's a vicious circle. Austerity programs bring discontent and rioting. You don't have to be a genius to see that this is where the U.S. is headed. You can argue that this will not happen to the world's largest economy. However, when will China become the world's largest and most powerful economy and then the U.S. has to dance to all the Chinese, Saudi and other U.S. debt buyers? The handwriting is on the wall! If you can't figure out who to vote against in the 2012 presidential elections, there's no hope for you. However, it goes beyond that, vote for people with some realistic understanding of real world economics. As the Trojans said "beware of Greeks bearing gifts."
Occupy Wall Street: Economics and the First Amendment
The Occupy Wall Street folks are tremendously naive. They believe Wall Street is responsible for the collapse. Partly, but the U.S. government is more culpable. It started with federal legislation encouraging banks to make home loans to very high risk borrowers. It was exacerbated by a lack of investor confidence in the government and economy because of a federal debt that was out of control and an ObamaCare plan which would cost billions and jobs. Yes, there was criminality and corruption on Wall Street and it needs to be dealt with. However, bailing out obviously mismanaged firms sent the wrong message. They think some kind of socialism is the cure. (See Economist Walter Williams recent column) They haven't been doing much reading about the crisis in Greece and the EEU. They don't get it that there is no such thing as a free lunch or pie in the sky. However, I respect their First Amendment right to protest peacefully.
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