57 Comments

1. BigFire:

Good luck getting anything done wihtout ruffle union’s feather. Expect national unions to shut down France for a couple of months.

Jul 15, 2005 - 8:38 am 2. Fausta:

He also said in the same interview “When I am outside of France… I feel self-confident”.

As Monty Python put it, “Oh-wee!”

Jul 15, 2005 - 8:49 am 3. David Thomson:

ìGood luck getting anything done wihtout ruffle union’s feather.î

This is a major reason why I remain pessimistic about political liberalism taking hold in France. The intellectual virus of womb to tomb lifelong socialism has seduced a majority of Franceís citizens. Those who are middle aged will be especially resistant to change. Any improvements will be a matter of too little and too late. France is royally screwed. Its best and brightest should still want to move to the United States.

Jul 15, 2005 - 9:02 am 4. markus:

Another way of putting it David, is that the French prefer their way of life to American hyper-capitalism, and they will fight democratically to preserve as much of it as they can.

Libertarian market systems don’t have virtues, but they simply shouldn’t be the only system there is. There ought to be an alternative to the American and Chinese economic models. Hopefully, Europe will increase their productivity enough to be able to retain as much of the current system as possible.

Jul 15, 2005 - 9:27 am 5. David Thomson:

ìAnother way of putting it David, is that the French prefer their way of life to American hyper-capitalism, and they will fight democratically to preserve as much of it as they can.î

There is no such thing as a viable racial, ethnic, or national understanding of economics. Oneís theories either work—or they do not. You might as well assert that you reject the consensus scientific view concerning gravity. However, you will likely be the only one foolish enough to jump out of an airplane without a parachute.

The French indeed do have the right to choose their own economic system. One also can do little if someone opts to drink themselves to death. They will have to make their own bed and accept the inevitable adverse consequences.

Jul 15, 2005 - 9:47 am 6. Knucklehead:

There ought to be an alternative to the American and Chinese economic models.

But, Markus, there is and alternative and it is in full swing in Europe. Spend a few generations getting rid of population, then a generation building a socialist economy, then another generation converting it to a ponzi scheme, one more generation to milk the ponzi scheme dry, then rinse and repeat.

Jul 15, 2005 - 9:53 am 7. Kevin P:

Marcus:

You are 100% correct that the French have the right to decide the fate and style of their economy. But the French don’t just expect their own people to carry the weight. These are facts are from a speech that Tony Blair made regarding the farm subsidies within the E.U. so I can’t personally vouch for them but according to Blair 40% of E.U. agricultural subsidies go to France to support 5% of the total farmers that produce 2% of the E.U. agricultural output. Now if the goal of the E.U. is to maintain small farmers in France with the rest of Europe footing the bill then that is their right. And the French countryside is quite beautiful. But I imagine if the populace of Europe were given the chance to decide whether this system was a smart way to run an economy or even a just economic model they might possibly decide otherwise.Our own farm subsidy program is a joke but compared to those facts(if accurate) it doesn’t look as bad. If Europe was a closed economic system it might be sustainable but since they are not the things that they are struggling to save, small French farms, will eventually be lost in the long run but not until billions of euro’s have been spent in the effort. Kevin Peters

Jul 15, 2005 - 10:12 am 8. Morgan:

High unemployment in France is a strategy to prepare for the coming demographic problems – fewer jobs now means fewer jobs to fill in the future – it’s a masterstroke.

markus, I agree with your thesis that trying multiple economic models is a good thing, and I certainly agree that the French have the right to choose one that they believe will maximize outcomes according to their own set of values. I’m afraid, though, that in Europe we’re looking at a number of similar models that are deteriorating, and soon will not be acceptable to those who have chosen them. A state that sees public welfare as the principle good and supports it generously sounds great… until the money runs out.

The generous social benefits in these systems clearly provide disincentives to work, and the high tax rates needed to sustain them do the same. In addition, the tax rates make businesses uncompetitive by increasing labor costs and the margin over cost on each unit necessary to make a profit that is acceptable to investors.

Growth in the Eurozone is slow (see http://business.scotsman.com/economy.cfm?id=1385422005 ) and some countries are flirting with recession – Italy is already in one, despite a rapidly growing global economy. There are no signs that things will pick up significantly anytime soon.

Add to that a rapidly aging population and the resultant ballooning of the benefits to be paid out, and you’ve got problems ahead. Tax revenue increases little, government expenditures increase a lot, something’s got to give.

Jul 15, 2005 - 10:14 am 9. Steven Mitchell:

But there is an alternative. It’s the low, flat tax and similar things being practiced in various recently liberated countries (e.g. Lativa).

“Good luck getting anything done wihtout ruffle union’s feather.”

But considering what they accomplish in July, August normally, would anyone notice? Don’t they all go the beach while granny cooks in Paris?

(I’m only half joking. One of the reasons the American telecom union lost it’s punch was that the Bells *made* money every time there was a strike, as long as it didn’t go on longer than a month or two. There were enough managers left to keep the important stuff humming. The rest could wait. Meanwhile, low inventory and low overhead.)

Jul 15, 2005 - 10:17 am 10. vegetius:

Markus:

“Hopefully, Europe will increase their productivity enough to be able to retain as much of the current system as possible.”

Sorry, Markus, but ‘hope’ isn’t a good survival strategy.

I would like to see Notre Dame and Chartres before they become mosques.

Jul 15, 2005 - 10:21 am 11. Paul:

Yes, Roger, that’s a very good pun!! Caught my eye right away.

The thought of concentrating on the nonproductive members of a society at the expense of the productive ones is so transparently wrongheaded that it’s stunning.

And if those of Markus’ ilk, after the events of the past century, still cling to their belief in socialism, I fear the ONLY thing that will purge them of their irrational crypto-religious fanaticism would be for them to personally suffer the real impoverishment that would result from the full implementation of their policies. Of course living fat off the Capitalist teat assures them that will never happen.

Marxism-socialism is the creationism of political economy.

Jul 15, 2005 - 10:21 am 12. Morgan:

To corroborate my point about the Eurozone’s long-term prospects looking grim:

http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2005/07/13/cnoecd13.xml&menuId=242&sSheet=/money/2005/07/13/ixcity.html

Jul 15, 2005 - 10:31 am 13. markus:

Free market fundamentalism is just as much of a crock as any other sort of fundamentalism. At the same time, one cannot redistribute wealth more equitably unless it is first created. The American export to Europe that is needed is a hefty dose of pragmatism. Basically, if Europeans want to have their generous public welfare systems, they’ll have to increase their productivity, and start having more kids.

I’m very torn about the question of agriculture price supports, in France, Turkey and elsewhere. On the one hand, removing them would give more opportunity to African farmers. And it would be the efficient thing to do. On the other, it would lead to the destruction of the way of life for the rural citizens of these countries, forcing the younger generations to migrate to the cities, often with few propects.

What the free market fundamentalists don’t understand is that there are things that nations value that cannot be measured in dollar figures. It is like a weird variation on Marxist determinism, which also sees man solely as an economic creature.

Jul 15, 2005 - 11:01 am 14. JK Ribera:

Perhaps the above poster has missed the news that the French are among the world’s great consumers of anti-depressants (Prozac).

Jul 15, 2005 - 11:09 am 15. Steven Mitchell:

You guys see what I mean about “fundamentalist” when I warned about being so free and easy with the term? It’s not even descriptive anymore. It’s now just an insulting adjective one puts before whatever one doesn’t like.

Markus, ignoring for the moment all the other illogical bits in that last post (like cause and effect backwards), what do you think would be the *result* of Europe becoming more pragmatic? It seems to me that a pragmatic person would be inclined to copy what worked from the more successful. Ergo, the European would become more enthusiastic about a free market. Would that make him a fundamentalist pragmatist? Or if you do exactly the same thing as the fundamentalist freemarket guy because it works, it is ok then?

As for agricultural price supports, you can get a good answer by looking at *all* the costs. One of the big costs is that it encourages people to stick with a venture that will ultimately fail. Thus the failure is always far worse later. Some borderline cases should get out of farming. Many of the ones that are left will change what they grow–usually to something that benefits from the smaller scale. Organic vegetables are a huge boon for small farmers right now for precisely that reason. As a bonus, the farmers that stick with the original crop may make it now, since there is almost always some demand for fresh whatever.

(I can conceivably see justification for some kind of loan, rolling weather support, whatever, to help farmers as a group get through a few bad years, even in a mostly free market world. But price supports ain’t it. If you’ve had 5-10 bad years, it’s time to try something else.)

I’m a big supporter of family farms. But just because your grandfather grew corn, it doesn’t follow that the farm you inherited from him should do the same. As it happens, my grandfather got through the depression farming because he knew enough about the market to grow a variety of things even while the idiot government was forcing him to plow under part of his crop.

Jul 15, 2005 - 11:32 am 16. Kevin P:

Markus:

Trying to promote or save a “way of life” can be a good thing. But if it becomes so cut off from economic reality it becomes closer to religion then economics. I certainly am not advocating pure, untouched, capitalism. Our current economic model is not anything like that.Of course there are “religous” economic fanatics who preach that. But what many in Europe term “anglo saxon rampant capitalism” still has many governmental regulations and controls is not pure laisez faire capitalism. Chirac’s enemy Blair is not some Chicago Economic school radical. He is just trying to free the economy partially from governmental strangulation. Chirac should talk to PeterUK and see if he thinks Blair is some kind of capitalist cowboy.

Look at Schroeder in Germany. He comes from the top down goverment control of the economy school. He looked at the figures, saw that they were not feasable and tried to implement some minor reforms in the welfare and Union rules in Germany. But because these benifits have been enshrined as economic rights as important as the freedom of speech he is losing support on the left as well as the right. The constant preaching that the government has complete responsibility to maintain benifit programs that are unsustainable has inculcated the notion in many citizens that their income should have no connection to their own effort. You say that Europe has to become more productive and you are right. But one of the “way of life” issues that the European left is trying to maintain is the notion that work should not interrupt the enjoyment of life. Productvity generally has two components, effiency and hard work. The fact that the notion of a 35 hour work week has become one of the first commandments of the secular economic religion it is now very hard to make any changes. The cold hard truth of any economic model is that the world economy is never static and some things that might have been wondeful in the past are millstones regarding the future. And when economic models become so inflexible they lose the ability to adjust to changing realities.

As far as having more children goes that also bumps into the “way of life” issue. Large families have been devalued in European societies and described as interruptions in peoples personel growth or a threat to the enviroment.Unfortunetly their economic model depended on a not having a negative population growth so as they devalued large families they were knocking one of the props that kept their system afloat.

Kevin Peters

Jul 15, 2005 - 11:54 am 17. vegetius:

Gee!! Does anybody rmember the 70’s and 80’s when all the US did was get lectures from the Japan Inc and the Euros, how they were the emerging new powers, that we should do more to emulate them, how a tighter alliance between government and industry and more central planning was the wave of the future??

Jul 15, 2005 - 12:15 pm 18. Doug S.:

It seems to me that markus is setting up a false distinction here, between American/British ‘hyper-capitalism’ and European-style socialism. The U.S. does not have a perfectly open economy in which private businesses are free to do whatever the heck they want, the public be damned. Even the largest corporations are constrained by laws covering anti-trust issues, consumer protection issues, import and export restrictions, reporting financial results to stockholders, the minimum wage, and so on; as well as by the threat of liability issues thanks to our legal system. Free enterprise is something that we honor in theory, but kinda limit in practice.

In fact, it’s more accurate to say that the economies of the U.S., U.K. and Europe represent a continuum, with statism at one end liberalism at the other. I think most of the commenters here are simply pointing out the the things markus knows will have to happen to make Europe more prosperous in the future will by definition move it toward the liberal end of the continuum, where the U.S. and the U.K. already are. That’s the leap of insight that he seems unwilling to make.

Jul 15, 2005 - 12:25 pm 19. Doug S.:

BTW, get a load of that pic of Chirac and Blair on Drudge’s front page today (taken at the G8, I’d guess). Look at their faces, especially Blair’s. Speaks volumes. And I wonder what was going through Koizumi’s mind (at first, I thought he was standing right between them, but it looks like he was actually in the row behind). Hilarious, in its own way.

Jul 15, 2005 - 12:29 pm 20. Katherine:

To all proponents of the wonders of socialism, I can only quote my Mom: I wish they spent a year living in a workers quarter in Warsaw. And got back to me after that one year.

And French? Let them continue with their precious way of life. I only wish part of my Momís pension was not used to subsidize it.

Jul 15, 2005 - 12:39 pm 21. Bostonian:

Markus,

What socialists like you fail to grasp is that capitalism (named by its enemies) is not all about money.

It’s about freedom of choice at a very personal level, and that includes making choices based on intangible, personal, inexpressible preferences.

It is the socialist Left who deride people’s personal choices, arrogantly assuming that monetary cost is the only factor in those people’s decisions.

And it is the socialist Left (not the free market fundamentalists whom you deride) who insist that a monetary value can be assigned to everything, given a suitably intelligent government.

Witness the Left’s arbitrary price controls. Witness the Left’s assignment of fees, fines, and taxes, to control people’s behaviors towards a purportedly “good” common goal (or worse yet, to inculcate a better character!).

Jul 15, 2005 - 12:43 pm 22. PeterUK:

The French farmers are the price Chirac pays,or rather lets others pay,for keeping his head out of a basket.The French are somewhat overdemonstrative,especially the farmers,who will quite happily burn a truck load of live British lambs to make a point,after that,a President is a mere bagatelle.

The EU is a giant pyramid selling scam it can only survive by adding more members.It is now in the position of the two antique dealers stranded on a desert island with one Chippendale chair between them,they both made a profit.

Unfortunately the EU was designed to prevent conflict,whilst there is much talk about open borders,the free movement of people and goods within its borders,the EU is still selling the same chair to the same customer.

Jul 15, 2005 - 12:52 pm 23. WichitaBoy:

vegetius,

Does anybody rmember the 70’s and 80’s when all the US did was get lectures from the Japan Inc and the Euros, how they were the emerging new powers, that we should do more to emulate them, how a tighter alliance between government and industry and more central planning was the wave of the future??

Correct me if I’m wrong, but isn’t Krugman still singing that same tired old tune?

Jul 15, 2005 - 1:14 pm 24. Steven Mitchell:

Yeah, but now it’s China that will eclipse the USA. When you are too lazy to change the verbs in the same tired old story, sometimes a few strategic noun changes gives it a fresh spin.

Jul 15, 2005 - 1:21 pm 25. vegetius:

W.B.

“Correct me if I’m wrong, but isn’t Krugman still singing that same tired old tune?”

I haven’t read Krugman since his nervous breakdown following the 2000 election. Poor dear has the vapors.

Jul 15, 2005 - 1:31 pm 26. Tim:

France can have any economic system it wants and can afford. But France should never forget it takes capitalists to pay for Socialism.

Jul 15, 2005 - 2:05 pm 27. markus:

Bostonian — there will always be voices for some elements of government control within a democratic, capitalist economy. People willing to band together to maximize economic security through redistributive means. And as long as we vote one person one vote, those of us willing to do this will attain at least SOME political power. People certainly do value opportunity, but especially as they get older, and deal with the uncertainties and disappointments of life, they also value security. And the one thing we do see with the social insurance programs like the British and Canadian health program, the European unemployment funds, and the US Social Security and Medicare systems, is that once people become accustomed to that, they fight kicking and screaming against the attempt to take them away. Maggie Thatcher didn’t dare, for instance, to mess with British public health care.

As the boomers retire, they are going to form an extremely powerful voting bloc. They will also enjoy receiving their SS checks and Medicare benefits, and will be adverse to anyone taking them away. The younger workers paying for them will someday retire too? And why would they all of a sudden be uninterested in receiving their check, considering the contribution THEY had made to the boomers retirement?

And hopefully we can institute a similar situation regarding universal health care in the coming years, particularly as the costs of premiums continue to burden corporations.

I feel cautiously optimistic about the future of these “socialist” schemes in America.

Jul 15, 2005 - 2:09 pm 28. lindenen:

Many of us are well aware the Boomers are going to screw their kids and their grandkids out of a future, but it’s not like that’s much of a change from the past 30 years of Boomer parenting. As for the rest of your post, bwahahaha.

Jul 15, 2005 - 2:22 pm 29. markus:

lindenen — don’t forget, U.S., British and European social insurance programs where instituted not by the self-indulgent boomers, but by the “greatest generation.”

Jul 15, 2005 - 2:39 pm 30. Katherine:

Markus,

You really, really want to have only one MRI machine available per state? Or fear Friday admission to the hospital, because chances of survival decline precipitously on the weekend since only skeleton staff is available? Or for a lab to loose your biopsy sample when you suffer from very malignant cancer, thus speeding your removal from this Vale of Tears (I did not make these up)? Must we suffer the indignities of universal healthcare in this country too, when overregulation already makes life extremely difficult for most doctors and patients?

You are in a very lucky situation to live in the West, where immigration is only a matter of choice: nobody will be shooting at your back while crossing that border or threatening your remaining family with jail. So, do yourself and us a favor: immigrate to any socialist country of your choice. Canada, or Sweden, or Cuba, whatever.

You see, I was escaping the glories of the system that you want impose on us. If the US goes socialist, freedom of this planet will die.

Jul 15, 2005 - 2:44 pm 31. Morgan:

markus:

…once people become accustomed to that, they fight kicking and screaming against the attempt to take them away.

Exactly so, and exactly what is happening in Europe, which is why we should be extremely cautious about creating these types of entitlements. Each person acting in what he believes to be his own best interests, asking the government to take someone else’s money and transfer it to himself, is analogous to grazing sheep on common land, and we all know how that ends…

Jul 15, 2005 - 2:48 pm 32. lindenen:

Weren’t Medicare and Medicaid instituted by Boomers? At the very least, they lagged the formation of Social Security by decades.

Jul 15, 2005 - 2:54 pm 33. markus:

Katherine — If social democratic systems are so horrible and inefficient and unjust, how come the electorate of those countries never seems to replace them with free-market?

Jul 15, 2005 - 2:55 pm 34. Bostonian:

I’ll answer that for you, Markus:

Because nobody wants to be in the last (aka losing) generation of a Ponzi scheme.

Jul 15, 2005 - 3:05 pm 35. Katherine:

Markus,

Pig like that (market system), you donít kill it all at once.

Jul 15, 2005 - 3:06 pm 36. lindenen:

The pig has to drop dead of his own accord before people realize the jig is up.

Jul 15, 2005 - 3:11 pm 37. markus:

lindenen — Boomers weren’t voting in 1965, when Medicare and Medicaid were instituted. The “greatest generation” didn’t vote for SS in 1935 either, but their parents did. And the “greatest generation” was less than enamoured with free market radicalism, having experienced the shortcomings of the free market during the Depression years.

You’ll have to register to get this article, but here is an excellent article by Jacob Hacker in the New Republic, about why changes in the economy increase, rather than decrease the need for social insurance programs:

http://www.tnr.com/doc.mhtml?i=20050704&s=hacker070405

Morgan — I agree that caution, or as I said, above, pragmatism, is important. As Tim said, it takes capitalists to pay for socialism.

Jul 15, 2005 - 3:11 pm 38. markus:

A quick excerpt for Hacker, highlighting the importance in a democratic society of “security”, and “insurance”, in addition to freedom:

“Bush and his allies recognize that the major domestic challenge of the twenty-first century is to give workers economic security in a transformed world. Just listen to conservative message guru Frank Luntz: “Every day, more Americans are concerned about their personal job security and their individual financial situation.” …Bush has denounced critics of the effort for denying younger workers “the same sense of security that previous generations had when it came time for them to retire.”

“Yet, across the board, current Republican plans to tackle rising insecurity–from private accounts in Social Security to medical savings accounts to tax reform–promise one thing and do another. They promise to protect workers and their families against economic risk. What they will do is shift more risk onto Americans’ already burdened shoulders. The conservative response to rising insecurity is equivalent to tossing a lead weight to a drowning man on the assumption that, now, he will really have an incentive to swim. It gets the problem right but the policies all wrong….

“Although the Depression was a watershed in liberal thinking about the economy, there was nothing automatic about the reforms eventually embraced. Nor did the New Dealers simply dream up a coherent program once the scope of the disaster became clear. Instead, they drew on a wide range of often well-established ideas and precedents, guided by an abiding conviction: Capitalism needed to be “made good.”

Making capitalism good implied many things: public employment, the taming of monopolies, relief for the destitute. Yet the most important ideal–and certainly the most enduring–was insurance. The word is familiar today, but, in the 1930s, it had a radical air. Insurance was an affirmation of free will over fate. If not an effort to stay the hand of God, it was an attempt to soften His blow. And it rested on modern actuarial science. The genius of insurance, especially when coupled with the power of the state to require participation, was that it could transform individual misfortunes into social costs distributed broadly across the citizenry. “Social insurance,” as it came to be called, transformed the dislocations of modern capitalism into risks that could be managed and redistributed, rather than blows of fate that could only be feared and suffered.

Jul 15, 2005 - 3:24 pm 39. PeterUK:

What has to be realised is the enormous scam perpetrated on the European taxpayer.

Many simply cannot give up their entitlements because the high basic tax rates have left them with insufficient funds to do otherwise.

As i have mentioned before the National Health system was created on the hypothesis that with a little free medical care illness would decrease nad a healthier society would ensue.Remember these were socialists and liberals so the idea of a hypothecated tax never occured to them,or that with the increase in medical knowledge demand would become infinite.Lastly and most importantly they didn’t have a clue about human nature…the service was free.

Back to taxation,the scheme therefore depended on economic growth and replacement level populations…oops!

The other weak points were that the recipients of healthcare were voters and the NHS became a source of political pride,”The envy of the World” the politicians claimed.”How come nobody has copied the system” we asked.

As good socialists the founders were unable to build a totally new system,so they nationalised the lot,including a pernicious workhouse ethic that dumped patients in old Victorian Hospitals and converted asylums.

Although the NHS is micro-managed by know nothing politicians,it can never be reformed because of union control,the medical profession and the fact that it is the largest employer in the world outside the PRC army.

Jul 15, 2005 - 3:58 pm 40. Paul:

“Yet, across the board, current Republican plans to tackle rising insecurity–from private accounts in Social Security to medical savings accounts to tax reform–promise one thing and do another. They promise to protect workers and their families against economic risk. What they will do is shift more risk onto Americans’ already burdened shoulders.”

This is an opinion being presented as fact.

It’s clear that were one to pay his FICA tax into a diversified private investment account rather than into the SS fund he will have accrued a much greater return on his investment upon retirement. Plus the money is his to pass to his heirs. Why do you think so many people have IRAs and the like rather than rely on SS?

The tax cuts Bush instituted have successfully revived the economy. Tax revenues are up 40% for corporations and 15% for individuals, revising down the projected deficit by $93B. Unemployment’s at 5%, and growth is a respectable 3.8%. This in spite of steep increases in gasoline prices.

The other thing that needs to be considered is the sheer wastefulness and inefficiency of government bureaucracies. Whenever the government is involved wealth is squandered, and that burden sits squarely on the shoulders of the taxpayers.

Socialism as a net force is an impoverishing mechanism. Dogooders need to realize this and learn that it is like a narcotic…judicious use in crisis type situation can help to ameliorate pain, but too much leads to addiction, wasting, and eventually, death.

Jul 15, 2005 - 4:59 pm 41. markus:

Paul — Hope it wasn’t too much trouble to find those growth stats. Yeah, the Bush tax cuts are doing wonders for economic growth…if it keeps up for more than a few quarters, they’ll rival the Bush 41 and Clinton tax INCREASES in effectiveness.

As they say, “correlation, is not causation.”

“FICA tax into a diversified private investment account rather than into the SS fund he will have accrued a much greater return on his investment upon retirement.”

That’s a big 10-4, maybe and MAYBE NOT, Roger. The greater the opportunity, the greater the risk. SS is supposed to be a basic income FLOOR, nothing else. In fact, it gives people the freedom to take other risks, investment-wise and in other ways, with the knowledge that they or their parents won’t be dog food if those other risks work out badly.

Jul 15, 2005 - 5:11 pm 42. Paul:

“Paul — Hope it wasn’t too much trouble to find those growth stats. Yeah, the Bush tax cuts are doing wonders for economic growth…if it keeps up for more than a few quarters, they’ll rival the Bush 41 and Clinton tax INCREASES in effectiveness.

As they say, “correlation, is not causation.”"

You’re crazy if you think a tax increase with the economy reeling from the .com bubble bursting, corporate scandals, and 9-11 would have done anything other than drive the economy into a downward spiral.

Tax cuts stimulate the economy. That’s not in dispute. What’s disputed is whether or not they lead to increasing or decreasing tax REVENUES.

I didn’t have to dig any deeper than the MSM headlines to find that said revenues are up by the amount stated in my previous post, and thus the deficit is projected downwards.

“That’s a big 10-4, maybe and MAYBE NOT, Roger. The greater the opportunity, the greater the risk.”

One word. Galveston.

Even FDR believed SS should be privatized eventually, and he probably wasn’t thinking seventy years.

Jul 15, 2005 - 5:30 pm 43. markus:

“You’re crazy if you think a tax increase with the economy reeling from the .com bubble bursting, corporate scandals, and 9-11 would have done anything other than drive the economy into a downward spiral.”

With the Clinton surplus as strong as it was in 2001, we had plenty of money for a large short-term tax cut. My favorite would have been a payroll tax moratorium, lasting for six months to a year. What we didn’t need were long-term cuts benefiting almost exclusively the rich and upper-middle class.

Jul 15, 2005 - 5:38 pm 44. Jamie Irons:

lindenen:

Many of us are well aware the Boomers are going to screw their kids and their grandkids out of a future, but it’s not like that’s much of a change from the past 30 years of Boomer parenting…

What an obnoxious statement.

Jamie Irons

Jul 15, 2005 - 5:55 pm 45. Fausta:

If social democratic systems are so horrible and inefficient and unjust, how come the electorate of those countries never seems to replace them with free-market?

But they have:

From Thomas Freedman’s article, IrelandThe End of the Rainbow

How Ireland went from the sick man of Europe to the rich man in less than a generation is an amazing story. It tells you a lot about Europe today: all the innovation is happening on the periphery by those countries embracing globalization in their own ways – Ireland, Britain, Scandinavia and Eastern Europe – while those following the French-German social model are suffering high unemployment and low growth.

. . .

Ireland’s advice is very simple: Make high school and college education free; make your corporate taxes low, simple and transparent; actively seek out global companies; open your economy to competition; speak English; keep your fiscal house in order; and build a consensus around the whole package with labor and management – then hang in there, because there will be bumps in the road – and you, too, can become one of the richest countries in Europe.

Jul 15, 2005 - 6:01 pm 46. Jamie Irons:

markus:

lindenen — don’t forget, U.S., British and European social insurance programs where instituted not by the self-indulgent boomers…

“Self-indulgent boomers…”

That’s a good one.

Do you include among the “self-indulgent” our president, Condi Rice, Paul Wolfowitz, Tommy Franks, Steve Jobs and Bill Gates, most of the Vietnam Vets, many of the Republicans in Congress, virtually every hard-working physician and nurse I know, most of the people who are making our economy run right now, most of the parents who are paying their kids’ way through college and graduate school…?

You know, all of them…?

Jamie Irons

Jul 15, 2005 - 6:06 pm 47. markus:

Regarding Ireland: Well, he says they have free college education. Sounds good so far. They also strive to develop “consensus…[between] labor and management”, which I assume means something different to them than what it means to our largest employer, the Walton Family and its Food Stamp collecting Wal-Mart “associates.”

Also, according to Wilkepedia, they have seem to have nationalized health care system:

http://en.wikipedia.org/wiki/Health_care_in_the_Republic_of_Ireland

Hey, if they can accomplish all this with low corporate taxes as well, more power to them!

Freedman also cheers Scandanavian countries, which are growing, while also maintaining their extensive social insurance systems.

Jul 15, 2005 - 6:12 pm 48. markus:

Jamie — I should have put “self-indulgent boomers” in quotes, as I did “greatest generation.” I don’t call them anything but the luckiest generation ever. If you could pick a time to be born, I can’t think of a better, more intensely interesting time than the late forties and early fifties.

Jul 15, 2005 - 6:19 pm 49. Fausta:

So which is it,

if it keeps up for more than a few quarters, they’ll rival the Bush 41 and Clinton tax INCREASES in effectiveness.

or

Hey, if they can accomplish all this with low corporate taxes as well, more power to them!?

And with this question, this self-indulgent boomer says, good night, y’all.

Jul 15, 2005 - 6:42 pm 50. Kevin P:

Roger:

The idea of a minimum economic floor that we will noy let people fall below is basically good. But what has happened is that it has greatly expanded to a point where it doesn’t make economic sense for families to take care of their parents in their declining years and let the government do it for them.

What I am about to describe is not an attempt to pat my family on the back. What we are doing for our parents should be considered the norm and the requirement of the offspring of parents. And this also means that those seniors who have no offspring should be taken care of.

My parents are 88 and 87 and can not be left by themselves. When our family set down years ago and discussed what we were going to do when they began to physically break down we decided that we wanted, if possible, for them to live their remaining years at home and die there.My parents main asset was their home and a series of cash investments. My brother is a Investment counselor and knew there were ways we could shield our parents home from the state. When my father became wheelchair bound and my mother couldn’t handle the house we got together and had one of the kids move in to take care of them. we are using there assets to pay for their needs. We could have dumped them onto the state and if we had chosen too we could have protected many of their assets and kept them for when they died. that is one of the major social problems of the nanny state attitude. I am not talking about going back to 1850 and abolishing all government aid. But any system that allows adult children to shift the resposibility of the care of their parents on to the state is just wrong and it is bad for the family structure. Many people are in situations where there is no other choice and this is not intended to make them feel guilty. The 15,000(I think that is accurate) seniors that died because of neglect in france should never be allowed to happen. The actual increase of the temperature was not that great. It was simply the fact that so many french citizens had simply left everything to the state regarding their parents. Children taking care of their parents in their last years is not always the right choice. But I feel the attitude of “it’s the responsibility of the state” is growing and unhealthy and demoralizing.

Kevin Peters

Jul 15, 2005 - 7:16 pm 51. Morgan:

markus:

Ireland looks to me like a good example of striking a reasonable balance between social programs and free-market policies (as does the US, frankly, though I personally would like to see the government get smaller). Total tax burden is roughly the same as in the US. The Irish have certain advantages – a relatively low public debt, little military expenditures to speak of – and that frees up resources for social welfare spending. Ireland is also a comparitively tiny country, so I’m not sure how reasonable it is to expect their policies to “scale up”.

I believe Ireland’s health care system is “semi-socialized”, with both private and public aspects (I know there is a means-tested component, much like in the US, but don’t know the details).

By the way, I don’t think that reducing tax rates was a bad move. The budget deficit this year will be under 3% of GDP, which is remarkable, and sustainable indefinitely (assuming the economy keeps growing at its historic rate), though of course I’d prefer no deficit (all else being equal). And I do think the cut provided a significant economic stimulus.

Jul 15, 2005 - 9:29 pm 52. Jamie Irons:

Morgan:

From the Wall Street Journal editorial page today (sadly, it’s subsciption only, but I’ll quote some of the amusing part

Let’s see if we can get this straight: When tax revenues fall and budget deficits go up, it’s bad news. But when tax revenues rise and deficits decline, it’s still bad news.

At least that seems to be the way a sizable chunk of Washington is reacting to this week’s report from the White House budget office that the federal deficit is down by nearly $100 billion this fiscal year, that the deficit as a share of GDP is down to 2.7% (very near its historical average), and that this is all happening because tax receipts are surging by more than 14%. Uncle Sam is having a better year so far than even Paris Hilton, but half of the Beltway is depressed.

John Spratt, the ranking Democrat on the House Budget Committee, seems especially upset that this revenue surge isn’t coming from wage income, but rather from investment income — that is, the so-called “non-withholding” income tax collections which have skyrocketed by some 30% this year. “These are typically taxes paid on one-time capital gains, bonuses, stock-options income that may not recur,” he laments.

Well, sure, Congressman, the 2003 reductions in the tax rates on dividends and capital gains seem to be resulting in much higher tax revenues on … dividends and capital gains. This is called the Laffer Curve effect, and we thank Mr. Spratt for validating it. If he wants those revenues to “recur,” maybe he’ll even vote to make those tax cuts permanent.

Jamie Irons

Jul 15, 2005 - 10:19 pm 53. Buddy Larsen:

Clinton surplus = RR’s defeat of USSR (peace dividend) + digital revolution + ‘94 GOP congress forcing a balanced-budget deal. Went bye-bye on 9-11-01. Tax cuts for wealthy? Tax cuts a pro-rata for tax-payers, those who pay no income taxes got no cut–can’t cut zero. And on and on and on….

Markus, your isolated-fact cherry-picks, non-sequiters, and mischaracterizations in this thread alone would write a good book for TV sound-bite Dem economic-analysis.

On the other hand, nice display of energy. Too bad you’re invested in all that socialist rot. It most hurts the most vulnerable. Your SocSec “floor” that frees up investment is absurd, as you know…waste helps no one, ever–except those in the waste business.

Jul 15, 2005 - 11:22 pm 54. Steven Mitchell:

Jamie, those opinion journal editorals are always subscription only on the day they are posted, free to view thereafter.

Jul 16, 2005 - 7:01 am 55. PeterUK:

It has to be pointed out that up to now Ireland has been a net beneficiary of EU funds.There are now proposals that this should change,the straight jacket of the Euro is causing considerable damage to the economy.The “Balance” is not right at all.

Jul 16, 2005 - 8:18 am 56. Morgan:

Peter:

Alas, things always look worse on close inspection.

Jul 16, 2005 - 9:38 am 57. dtlc:

Here are 2 satirical pieces – funny and insightful:

(1)

“Price of French Language to Be decided by Japanese Court” July 15, 2005 article

(2) “French Economy Gets a Boost After Paris Loses 2012 Olympics to London” July 7, 2005 article

“http://satire.myblogsite.com/blog”

Jul 16, 2005 - 10:12 pm

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