BRET STEPHENS: 2012 A U.S. REFERENDUM ON EUROPE
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2012: A U.S. Referendum on Europe The EU’s crisis is not just fiscal and monetary. It’s also a crisis of vision and character.
“Do the Iowans who will turn out to vote today know all this? I suspect they do. What is happening in Europe is more than an economic crisis: It’s the coming apart of a world view that held together for over a century. For Europeans it will probably mean a decade of economic hardship and political risk. For Americans, it’s a loud pinging signal coming across the Distant Early Warning Line.”
The conventional wisdom about this year’s presidential election is that it’s mostly about domestic issues and barely about foreign policy. That’s wrong. What kicks off today in Iowa is America’s referendum on whether it wants to become an honorary member of the European Union.
GOP-leaning voters generally get this: Warning against the “European social democrat” model is one of Mitt Romney’s better talking points. The problem for Mr. Romney is that he represents something of another European specialty: the dispassionate technocrat, data-driven, post-ideological, lacking in soul. GOP-leaning voters get that, too.
Many on the left also understand American politics as a referendum on Europe, and it wasn’t all that long ago that they were more-or-less prepared to say it. For example:
• “Europe is an economic success, and that success shows that social democracy works.”
-Paul Krugman, Jan. 10, 2010
• “The European Dream, with its emphasis on collective responsibility and global consciousness. . . . represents humanity’s best aspirations for a better tomorrow.”
-Jeremy Rifkin, “The European Dream,” 2004
• “If we took Europe as a guide, we would do a lot better at capitalism.”
-Thomas Geoghegan, “Were You Born on the Wrong Continent?” 2010
These views have now become a bit embarrassing, intellectually speaking. But it hasn’t done much to change the basic terms of the debate President Obama will have with whoever emerges as his challenger.
The contours of that debate are familiar enough. Should government be an engine of employment growth? Does government investment in favored industries or technologies make economic sense? May government compel individual economic choices in the name of a social good? Should the rich pay an ever-rising share of the total tax burden? Are higher taxes the best way to close a budget deficit? Is financial regulation generally effective? Are labor unions good for overall employment? Is inclusiveness the best test of fairness? Must environmental concerns (or phobias) take precedence over economic interests? Is consensus-seeking the ideal mode for international conduct?
Associated PressPresident Obama at the G-20 summit in France. Fits right in.
To all these questions, Mr. Obama’s record answers yes: the Solyndra and Fisker subsidies; the Keystone XL pipeline postponement/cancellation; Dodd-Frank; the SEIU’s Andy Stern as the top White House visitor; the growing government work force; the individual mandate; the nonstop rhetorical assaults on Wall Street; federal debt moving north of 100% of GDP; the “balanced approach” to deficit reduction; the perpetual deference to the United Nations.
That’s the Obama presidency in a nutshell. It’s also how Europe, mutatis mutandis, became what it is today.
There’s an alchemistic quality to some of the more common explanations of Europe’s crisis. Wizards of finance contrived to lay a European economy low. The contagion spread. Financial fires could not be put out in time. Investors stampeded for the exits.
The mixing of metaphors alone betrays the flimsiness of that analysis. The truth is that what began in Greece (and the U.S. financial crisis before it) simply put a match to already very dry tinder. Uncompromising labor unions have spent decades driving European jobs and industry overseas. Confiscatory tax rates have given every incentive to tax evasion, capital flight and the emigration of the fittest. Work-force rules have diminished productivity and discouraged hiring. National budgets have been strained to breaking by delusional pension promises and the mounting cost of everything a welfare state supposedly offers free, like health and education.
Worst of all, the European model has generated a self-reinforcing combination of prejudice and interest that is almost impossible to break. A cultural bias against “savage Anglo-Saxon neoliberalism” limits the political options for structural economic reform; routine labor strikes, politically entrenched civil services (38% of Belgians work for the state, doing Lord knows what), and other beneficiaries of public largess eliminate all remaining hope. Europe’s crisis is not just fiscal and monetary. It’s also a crisis of vision and character.
Do the Iowans who will turn out to vote today know all this? I suspect they do. What is happening in Europe is more than an economic crisis: It’s the coming apart of a world view that held together for over a century. For Europeans it will probably mean a decade of economic hardship and political risk. For Americans, it’s a loud pinging signal coming across the Distant Early Warning Line.
It would be absurd to say that Americans have nothing valuable to learn from the rest of the world, Europe included. But sometimes the most valuable lessons are negative ones. Though he did not mean it quite in this way, Mr. Obama was right to compare his administration to those of FDR and LBJ: Like them, he has driven the U.S. miles down the road toward the social democratic model he so admires. Then again, neither of his predecessors had such visible evidence of where social democracy ultimately leads. What’s this president’s excuse?
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