IvonneGoodrum199
Politics Versus Economic Reality: We'll All Lose
In the western world there is quite obviously a battle between the politics and the economics. It is clearest is Europe where - all most as one - the economists are saying the Euro is condemning many to long-term austerity and inevitable poverty and it is therefore unworkable - but somehow the politicians don't seem to have it: or will they think the alternative is worse? And the reason for this problem is above all else the resolve for excessive government spending primarily driven through the welfare state. As well as in the USA, that great bastion of free enterprise and also the American dream, is in the middle of the battle to bring the very same welfare state to those shores whilst ignoring escalating public debt.
In Democracy in the usa (published in 1835 in France), Alexis de Tocqueville wrote "The American Republic will endure before the day Congress discovers that it may bribe the general public using the public's money." Which appears to be happening today. De Tocqueville is interesting because at that time France, and indeed the rest of Europe had primarily aristocratic rule and he was a liberal who supported the idea of democracy. But he was worried about the long run effect of this democracy on sensible economics: "From that moment on, the majority always votes for the candidates promising the best results from the public treasury with the result that a democracy always collapses over loose fiscal policy."
An interesting development in that the EU - in a desperate attempt to save the Euro - has decreed that member states should have a well-balanced budget. Of course the main reason they did not have a balanced budget was because politicians wanted to bribe their voters as well as their financiers (these day almost exclusively big corporate).
However the EU is fulfilling De Tocqueville prophecy by attempting to sideline democracy - in both Greece and Italy an effort by democratically elected leaders to even think about the possibility of leaving the Euro led to their instant removal by scheming EU apparatchiks and their replacement by so-called Technocrats. When the EU has its own way I suspect the Greek election due soon is going to be postponed as will every other election that threatens a vote that will destabilise the union.
Obviously the total absurdity from the EU is as it clamps down heavy heavily on rising budgets in EU members states its very own budget expands exponentially with screams of protests if anybody suggests otherwise.
But the simple issue is this - can democratically elected governments really cut the money they are spending towards the voters and ever hope to be elected again? Clearly the very first prerequisite would be that the politicians are willing and then are able to make the argument - and win it - using their voters. These days, with politicians who use opinion polls rather than conviction as their guiding light, that seems a large ask. Or perhaps is it conviction of the wrong kind - a conviction to the liberal democratic model that believes their state should 'take care' from cradle to grave. The situation in the US appears to be probably the most peculiar - with Europe to illustrate what happens when an excessive amount of is spent of social largesse it is extraordinary the US appears to be following a same model. You don't have to be a person in the Tea Party to determine something needs to be done about US government spending - and surely the priority ought to be getting the budget balanced before contributing to it!
The UK's electorates dependence on the NHS (free healthcare) is an illustration of the problems of attempting to alter something which is sacred cow - yet most accept it's not efficient. Even talking about NHS reform has government pollsters in a lather of despair.
So in the western world the politics is ruling the roost: maybe we should say the little head is ruling the big head because as we all know that economics is like a river: it may be dammed, diverted and siphoned however it keeps coming and in the finish those trying to stop it must be overwhelmed.
Now you ask , when will economics win? I lived in Eastern Europe after economics eventually won the Cold War. That suggests to me Europeans will ultimately be living in some type of protected enclave where those outside have the latest gadgets and they will be stuck with a classic ipad: buildings won't be repaired and infrastructure will creak and barely work. The inevitability of economics suggests that is how the EU is heading: a failing totalitarian state.
The truth is as to possess state spending - we need to generate enough wealth to finance that spending. That is the economics of it. Furthermore that wealth must also must grow and be readily available to reinvest in new projects to create more wealth to help keep paying the bills. In the socialist/communist system the need to invest is ignored and inefficiencies sidelined within the have to keep up with the system.
In the united kingdom the Blair/Brown years saw a vast numbers shuffled onto welfare dependency known as disability. This was no different to the communist regime allocating every new member of the workforce employment - regardless of whether a brand new employee was needed. It made Communist business hopelessly inefficient in terms of manpower: whilst pushing people into welfare dependency just transfers to cost to the tax payer - net effect is identical - less and less money for investment and for that reason fewer, and eventually no new jobs.
