Tag Archives: Welfare state

KRUGMAN WATCH – WHAT AILS EUROPE?

We learn from Mr. Krugman that he, and only he has the answer.  There is the “Republican narrative and the German narrative. Neither story fits the facts.”

“The Republican story ….. is that Europe is in trouble because it has done too much to help the poor and unlucky,”  This is a classic mischaracterization of Republican and conservative positions.  Conservatives have just as much compassion for the truly poor and unlucky as anyone.  The objection is to the creation of dependency and an unsustainable welfare state that extends well beyond the poor and unlucky to include a majority of the populace.  The inimitable Denis Miller put it succinctly when he said “We just want some bona fides, that’s all”.

“[C]ountries that aren’t on the euro seem able to run large deficits and carry large debts countries that aren’t on the euro seem able to run large deficits and carry large debts without facing any crises. Britain and the United States can borrow long-term at interest rates of around 2 percent; Japan, which is far more deeply in debt than any country in Europe, Greece included, pays only 1 percent… Britain and the United States can borrow long-term at interest rates of around 2 percent; Japan, which is far more deeply in debt than any country in Europe, Greece included, pays only 1 percent.”

What’s that Paul,“without facing any crises”  There’s the rub.  What must it take to get Mr. K to see a pending crisis?  George Osborne holds the position of Chancellor of the UK, a position similar to that of our Treasurer.

The Government ‘has run out of money’ and cannot afford debt-fuelled tax cuts or extra spending, George Osborne has admitted. In a stark warning ahead of next month’s Budget, the Chancellor said there was little the Coalition could do to stimulate the economy. Mr. Osborne made it clear that due to the parlous state of the public finances the best hope for economic growth was to encourage businesses to flourish and hire more workers. “The British Government has run out of money because all the money was spent in the good years,” the Chancellor said.

As far as the U.S. is concerned we already know Krugman’s position is to keep increasing the level of spending until it gets us out of debt.  It’s my blog but I am a generous chap so I’ll give the famed economist the final word… which is –

“The next time you hear people invoking the European example …. here’s what you need to know: they have no idea what they’re talking about.”

CAPITALISM HAS DESTROYED EUROPE – GERMANY IS RESPOSNSIBLE FOR THE CRISIS IN GREECE

The magazines and newspapers in Europe are filled with stories pronouncing the end of capitalism.  They hold globalization and the free market system responsible for the financial crisis that has beset them.  It is greed in the private sector that threatens the continuation of the welfare state, they say.  There is no thought that it may be greed that drives the protesters who want to be carried by someone else’s life savings rather than work a little bit longer and create a little bit of wealth of their own.

To those who say capitalism is the cause, I have a few questions to ask.  When you retired from your government job at age 55 with a pension large enough to live on, where did the money to pay you come from?  With the free medical care you have enjoyed for most of your life, where did that money come from?  With free public education for your children and heavily subsidized university tuitions, where did that money come from?  Do you know?  Do you care?

Your government didn’t create it.  It was generated by the capitalist system you seek to end.  If you are successful what is your plan for a better system that will generate greater wealth, enough to continue and sustain and the benefits you have been enjoying and refuse to sacrifice?

The most absurd claims are the claims you read in the Greek papers, claims that Germany is to blame for the bankruptcy of Greece.  By that reasoning, I could buy a yacht for myself and blame you, dear reader, if the yacht is taken away from me because you wouldn’t pay for it.  Now that’s greed.