"The real lesson from Europe is actually the opposite of what conservatives claim : Europe is an economic success, and that success shows that social democracy works." "So if there were anything to the economic assumptions that dominate US public discussion — above all, the belief that even modestly higher taxes on the rich and benefits for the less well off would drastically undermine incentives to work, invest and innovate — Europe would be the stagnant, decaying economy of legend. But it isn't." America needs to learn from Europe's success- International Business-News-The Economic Times Maybe Obama is on the right track ?
i agree. secretly, i wish canada could join the european union. we at least have some social democratic representation at the federal level.
Of course Krugman is a Keynesian... it's no surprise he would take this position. Krugman the Keynesian - William L. Anderson - Mises Institute
Huh?! I don't understand what this is an argument for? Modern European economics is not that old. It is basically a result of alleviating the social injustice under the first period of industrialization (ca. 1800 to 1900) as more democratic means of government curbed the most exploitative robber-baron style of capitalism. WW1 was the swansong of monarch rule in europe, and with it the definite democratization of society. Especially the rise of labour unions, which finally provided an effective counter to the power of the industrialists. Not without problems though. The fascism of the 20s and 30s was essentially a reactionary movement by industrialists, aristocracy and the catholic church, against democracy in general, and unions in particular. The end of WW2 however saw a europe pretty much ruined. It was realized that a speedy recovery required a strong government in charge, servicing all of society, and not just particular interests. Universal healthcare is one example of this, but also grand infrastructure projects, more extensive public education including free higher education and so on. It was realized that for a nation to be stable and productive, all citizens need to partake in the effort, and those that can't for whatever reason, must be taken care of in a sustainable manner so that they perhaps can rejoin the workforce. This requires a strict fiscal policy, especially with regards to trade-balance and credit regulations. This have been harmonized on the continent through EU guidelines and regulations. European banks can't gamble using creative financial instruments. European nations can't just print more money. And European countries must stay within strict deficit and debt to GDP limits. It's this focus on industry, infrastructure and universal options and safety-net, that have made Europe what it is today. And it have taken less than 65 years. Granted, to begin with, it was slow and severe restrictions was in place to secure domestic industrial and fiscal growth. Much had to be built from scratch remember, and importing stuff by running a deficit not an option for stable growth. But by mid 60s most was solved, governments lifted restrictions as the fiscal and industrial sectors again was solid and competitive on a larger international market. As such, right now, Europe is front and center in innovation and upstarts. The reason is free education and a comprehensive safety net. Taking a chance on starting something new here in Europe, have two major benefits. First and foremost, failure is an option. Should everything go to shit, you won't be homeless and not have access to vital health services. You may go bust, and live on a bare minimum for the 5 year bancrupcy quarantine, but that is it. Secondly, European firms need not worry about also being primary healthcare and pension provider. Unlike US firms. Private options exist naturally, but these are supplements. There are negative aspects. A welfare state do not come cheap. And with all those rights, also come duties. So you see pretty high and progressive with income taxes. Black holes of national spending have also been cut to the bone, which can be read as keeping the military on a subsistance level rather than have large standing military forces. Weaknesses of the welfare model, have been exposed pretty clearly in later years, as immigration have grown. We've focused to much on rights, and less on duties. This is slowly changing though, as more and more legislation stress the importance of restricting access to various social funds. For example new demands of a minimum time in the workforce before being able to claim social security, and restricting availability to only those above 25 years old (to kick lazy youth not under higher education into the workforce) and a 5 year minimum legal residency in the country to be eligable to claim social security (to stop unskilled welfare immigration from the third world). And so on. European economies are basically sound, but that is not to say challenges do not exist. Government spending and beurocracies must be reduced to a more sustainable level. More focus is needed to expand the industrial and infrastructure base. But these are all problems that can be solved in relative harmony and require no big disruptions of business as usual. Unlike the challenges the US is facing.
Europe is much less centralized than the US, and has no foreign empire to maintain. Where would Europe be without the sacrifice of American taxpayers? Whether through our securitizing of western economies, or expansion through globalisation. I'm sure the US would be better if our government didn't have to police the world, and if the Federal government lost its monopoly over our economic and legal system. I think we should look to becoming a union of states again, like Europe, so that we can remove the burden of a corrupt central government.
Europe is much more difficult to manage as it is made up of historicly diverse peoples who's cultures and views often clash. I can't help but wonder what sacrifice US taxpayers made that wasn't made by the rest of the taxpayers in the western world if you are refering to the recent fincial crisis that started in your country? The only people who want the US to police the world live in america. Lastly all central governments are corrupt, the EU is well known for it but at least admit it and are trying to clean up their act. The simple fact is where you have massive bureaucracy you also have corruption and you can either admit to it and try and control it or deny and let it run rampant.
Does this not also apply to the US? The US has always been known as a nation of immigrants, and even referred to as a melting-pot of culture.
I could argue that diversity is greater in the states. We're all US citizens, but we all have unique backgrounds. Each US state has its own culture despite attempts to homogenize into a united state. But Europe doesn't even have an international bureacracy involved with health, and I imagine one would be just as bad as one in the states. I'm not referring to the recent crisis at all actually. If anything you can blame us for the coming collapse. I was talking about the 60 years of informal empire financed by the US and all the benefits shared by our western allies, both economically and militaristically. I'm sure we consume a good bit of your exports over there too. You can't pretend that the EU is in an economic vaccum seperate from the US. And also keep in mind both the US and EU partake in a fraudulent counterfeitting scheme that cannot possibly last forever. Not true at all. Both our foreign enemies and allies benefit from our warring tendencies. Which is why I think the US should be decentralized by reinstating the 10th amendment of our constitution, placing the option for universal health care or strict economic regulation at a state level.
It's easy to pretend to be economically successful and to have large state benefits when the United States foots the bill for the defense of the entire continent. The article is very short on facts, using out of context cherry picked economic numbers instead of datapoints that provide greater insight into the broader situation.
I agree the US is a nation of immagrants, but they went to the US to become American. There is no crossing of national boundries in the US just state ones with Americans on both sides no mater the ethnicity. Europe's political and cultural diffrences are slightly wider
How...? I still don't see how you're arriving at this conclusion. The intent of the immigrants "to become American" (not even sure what that is supposed to mean) is irrelevant to the fact that America is comprised of people from literally all over the world, from all different backgrounds and cultures and religions and regions. As well, within America, regardless of a lack of 'national boundaries', both within states, cities and the nation as a whole there are arguable ethnic communities that border each other. In Dallas, TX for instance, there's particular areas where the community is largely Asian-American, there's other areas consisting of mostly African-Americans, and other areas which consist mostly of Jewish-Americans, and so on and so forth--and within those communities, there's even further diversity as well. And this is Texas, which isn't what one might generally consider a state notable for its diversity in comparison to the larger areas of diversity like say... Florida, or New York, or California.
That is a truth with some modification. For sure, during the cold war, the US provided the bulk of the defensive force, not to mention the nuclear deterence force. And by all means, West-Europe did benefit from it. But why did the US do this? Out of sympathy, or more realpolitik motives? After WW2, the Soviet regime did hold up their end of the deal reached at the Potsdam conference. Amongst others, pulled their forces out of Northern Norway. The Warsaw pact, was a reaction to NATO. A case could be made, that the west, the US in particular, forced the Soviets to maintain a buffer (East-Europe) as a safeguard from attack from their great enemy, the capitalists. Of which only one was a serious threat, the US. With germany broken, and the other western-european countries exhausted, many in Europe at the time did fear a Soviet all out bid for the continent. So a good case can be made also for more than generous US vigilance in Europe post WW2. But I am not so sure it was as unselfish as many americans and europeans think it was. Also, during this period, European forces was was not excactly playing possum. Much was used on defense. Granted, as a percentage of GDP not as much as the US, but then again, West-Europe was only concerned with its own borders to the Soviets and their puppets in East-Europe. Not that concerned with various cold-war games around the globe. Though we did contribute substancially to the Korean war. As for the Vietnam war, that was a French travesty the US willingly inherited after the frogs said "Merde zis ztinking ratthull, veire goings houm!" Much good continuating that little conflict did the US In either case, with the collapse of the Soviet bloc, Europe have used a chainsaw on its military budgets. Not the US though. On the contrary. There was a downward trend from 90 to 98, but now it is almost as high in comparable dollars, as during the height of WW2. Wondering what that deficit is used for, go ask the Pentagon... They still think they will fight a proper organized war against a professional national army, where all those wonderfull and very expensive high tech toys will give the US the edge. In reality, the biggest asset in the assymetrical warfare of today, is what is essentially an RC aircraft, with a big zoom-lens camera in the nose and a Hellfire missile under each wing. Cost is next to nothing compared to any tank or jet in active service, or planned for future commission.
why don't we do what we did in the Clinton years? tax the rich,there the only ones that have money to just throw away
That would be arbitrary, coercive redistribution of wealth, and thus immoral. Do you support the practice of theft?
Immoral to you and many Americans perhaps.. Europeans look at things differently.. Europe is a success end of story.. While not perfect by any means there are lessons to be learned for America..
Not really, no... and certainly not because of Krugman's article. Many nations within Europe are plagued with all kinds of problems. This is not to say America's necessarily better off, we have plenty of problems too, but you talk about the EU in comparison like America's a third-world country or some such. If you want to believe in the likes of Krugman, be my guest, but it's not a very healthy practice--he's been discredited and refuted so much it's a wonder he still has his job.