You know things are getting bad in Europe when even NPR is airing concern about the austerity backlash sweeping the continent. That's what happened yesterday on All Things Considered when one guest compared the EU to the Titanic:
Former IMF Chief Economist Simon Johnson, now with the Peterson Institute for International Economics, says the loud political and popular backlash against austerity shouldn't mask the reality that the Greeks — and the currency bloc — are in serious trouble.
"The European Union and the eurozone is on the brink of a total disaster [of] which Greece, by the way, is just the beginning. It's just the tip of the iceberg, if you like," Johnson says. "The eurozone is the Titanic and they just struck an iceberg and they haven't realized how profoundly damaged they are below decks."
It's not just NPR either. The New York Times published an article Sunday expressing a similar fondness for basic economics as applied to Greece.* The piece quotes a Greek government adviser who fears where the backlash could be heading:
“For whatever reason, the hard-liners in Europe are saying that we deserve it,” Mr. Hardouvelis said. “They have destroyed the political center here, and the possibility of creating another Hugo Chavez is not zero.” ... “Someone has to explain to the Greek people that you cannot have your cake and eat it, too,” he said.
Someone might want to explain that to French voters as well. Last week, they elected the first Socialist President since Francois Mitterrand left office in 1995. Francois Hollande's campaign was run on rejecting austerity and in reaction to a Sarkozy administration which was seen as too cozy with the rich. Hollande has promised new infrastructure spending paid for with a new 75% tax on millionaires, "an idea that proved wildly popular among the majority of people who don't make nearly that much." Hollande also promised to roll back Sarkozy's austerity-minded reforms to the French social security system. If this all sounds somewhat familiar, listen to what Hollande said after he won:
"I am proud to have been capable of giving people hope again," Hollande told huge crowds of supporters in his electoral fiefdom of Tulle in central France. "We will succeed!"
Apparently, the difference between "We will succeed!" and "Yes we can" is the difference between European socialism and American progressivism. If that seems like an increasingly fine line, you're not wrong. The European left is surging with a message that boils down to saying no to basic economics, but we're seeing some of that here at home as well.
President Obama has spent months touting new taxes on "millionaires and billionaires," but none of his recommendations would eliminate more than 5% of last year's annual budget deficit. More importantly, the President has refused to offer any serious policy for dealing with the growth of Social Security and other entitlements, even as they push us toward bankruptcy. The President seems content to fiddle 'round the edges while Rome burns.
To be fair, some of the President's progressive allies are catching up with the idea that the party can't last forever. In Chicago, Rahm Emmanuel is demanding action on pension reform, including a plan to have workers contribute five percent more to their own retirement. And just this week Governor Brown in California announced a budget featuring $8 billion in cuts to schools, social programs and state worker salaries. In other words, some liberal leaders are now doing the very things the left excoriated Republican governors (Scott Walker, Chris Christie) for doing much sooner.
There's still a chance that U.S. voters will decide to follow the lazy, downhill trail being blazed by socialists in Europe. Anti-austerity is very popular and has its own foot in the door here courtesy of the far-left and the Occupy movement. Some people simply refuse to believe you can't have your cake and eat it too. But if recent polls in New Jersey are to be believed, there is reason to hope voters here are still more sensible than those abroad. Tough choices can still be popular ones in America, and that fact may turn out to be a difference-maker this November.
* Lest you get your hopes up, note that the Times also published an opinion piece Saturday titled Capitalists and Other Psychopaths. Three days later, it is still the 5th most e-mailed article on the Times' website. Sample:
I always found the notion of a business school amusing. What kinds of courses do they offer? Robbing Widows and Orphans? Grinding the Faces of the Poor?