Europe chooses delusion
Voters in Europe have chosen the welfare state delusion over reforms that would enable the region to become prosperous again.
In Greece, and now France, outright socialists have taken control of the levers of power. The person responsible for the maximum 35-hour workweek in France is being mentioned as a possible Prime Minister.
Both countries’ national governments have made agreements with other institutions about pursuing reforms frequently referred to as ‘austerity’ measures. Yet, Greek voters allowed a third party to create political chaos after the mainstream politicians enacted harsh spending and benefit cuts to get a bailout and avoid default. France under Nicholas Sarkozy had been working closely with the fiscally conservative German government, but Hollande campaigned on a promise to re-negotiate the reform treaty. Of course, Angela Merkel has thus far maintained that re-negotiations with either debtor state should not even be considered.
That didn’t prevent pandering left-wing politicians from promising voters that by raising taxes, or by continuing to fully fund welfare programs, that growth would somehow be achieved and jobs created. Incoming French President Francois Hollande said in his victory speech, “Austerity isn’t inevitable. My mission now is to give European construction a growth dimension.”
Given the history of the region, it’s not entirely shocking that voters in Greece and France seem to believe in a false dichotomy between austerity and growth, one in which the government can spend money to keep from going bankrupt.
It’s more shocking that our own political leadership buys into the exact same Keynesian fallacies.
Joe Biden, evangelizing for the power of delusion. Keynesianism works! People can retire at age 62, like they do in France, and then be completely supported by the government for decades. This will work even when the youth unemployment rate is 23%.
Europe has chosen to indulge its delusion of being able to maintain the status quo of a bloated welfare state being pulled along by a shrinking labor force that doesn’t really work very much. Hopefully America will decide to remain exceptional and avoid such fantasies.