Obama and ‘European Socialism’

Obama and ‘European Socialism’ January 31, 2012

One of the constant features of Republican rhetoric about Obama, especially from Mitt Romney these days, is that President Obama is leading American down the path to “European socialism.” Andrew Sullivan explains why this is nonsense:

The irony is that in 2012, in the real world outside of Mitt’s pander-world, much of Europe is being run by center-right governments, who are being dictated to by the center right government in Berlin. And what are 2012’s European policies with respect to the economy? Why, they’re much closer to Romney and the Republicans than Obama and the Democrats.

Germany is insisting on austerity and budget cutting even during a recession, just as the GOP wants. The result is a Europe on the very brink of a serious debt trap, in which cutting debt depresses the economy which depresses revenues which increases the debt some more. Greece and Italy are obviously the prime examples.

But perhaps the more gripping analogy is with Britain, where my Tory friends embarked on a very serious austerity program in the middle of 2010, in the hopes of liquidating the debt quickly, staying on the right side of the bond markets, and allowing new private sector investment to bring back growth. Sure, the US has an advantage of a global reserve currency, and Britain needs to prevent a collapse in the pound if the markets perceive fiscal drift. So Osborne has less lee-way than Obama. But still, the contrast is striking.

Mitt’s pander-world is known here as Planet Wingnuttia.

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  • I lived in the UK for the first 30 years of my life (pre-Thatcher), and I really miss ‘European Socialism’ (or at least British Socialism).

    It would be wonderful if Obama led us down that path.

    But he won’t.


  • d cwilson

    Republicans decided a long time ago it would be easier to run against the imaginary strawman Obama than the real thing. That’s why they keep winking at birthers and people who think he’s a “secret Muslim”. It’s why they keep saying he’s “dividing America” and playing class warfare by advocating tax policies similar to Saint Ron’s.

    Given their own track record, it’s not surprising they want to keep the debate in Fantasyland.

  • donalbain

    They may be centre right governments by European standards, but they still have horrible socialist healthcare, and more generous welfare systems, and more regulation of the financial sector, and better education subisdies…

  • donalbain

    Obviously, horrible is from the wingnut perspective.

  • harold

    As a US/Canadian dual citizen, I have to say that it’s too bad the US can’t try some “Canadian socialism*” (*not considered “socialism” in Canada, of course, and often practiced under right wing Canadian governments that kiss ass to Republican presidents).

    1) End useless wars and make moderate cuts in military budget.

    2) Increase revenue by raising some taxes on very well off people. The US could even get original and introduce a new marginal tax bracket for the portion of annual income $500K or above. Also make capital gains taxes progressive.

    Okay, I realize that some of this isn’t exactly like Canada, but the general idea of having less of a phony debt crisis by not burning money on way more military than needed and having decent revenues without depressing the economy is what I’m getting at.

    3) Universal health care by extending Medicare to the entire population on a voluntary basis. US Medicare probably inspired the various Canadian provincial health care systems anyway, they work in a very similar way.

    None of this would get rid of torture, the world’s highest incarceration rate, the “war on drugs”, locally excessive execution rates, AGW denialism, etc, etc, etc, but doing these things would more or less solve the debt crisis and give everyone health care.

  • KG

    Some straws in the wind suggest a revival of the European left.

    By 7th May, if current polls turn out to be predictive, the Repubs will have a perfect Eurobogeyman: the presidential candidate of the French Socialist Party, Francois Hollande, has a clear lead over Sarkozy. The Left also recently captured the French Senate, for the first time in the Fifth Republic. Sarkozy, in an attempt to regain the initiative, has just said he will impose a 0.1% tax on some financial transactions. Although the left have recently lost elections in Spain, Portugal and Slovenia in the wake of the financial crisis, and will lose the Greek election in April, the German right-wing coalition has been repeatedly losing regional elections, the Danes recently elected a government of the left after 10 years of right-wing rule, Croatia has elected a government of the left for the first time since 2000, and the right-wing governments of Hungary* and Romania are extremely unpopular and in serious economic trouble. Even in the UK, PM Cameron has been bleating insincerely about the need to rein in huge bonuses for top-level bankers (although he boosted his popularity late last year by refusing to sign up to an EU treaty – ironically one that would entrench austerity policies very similar to his own, which are pushing the UK and most of the EU towards renewed recession).

    I understand polls in the US are showing that growing inequalities have replaced immigration and security as Americans’ main concerns, which no doubt explains Obama’s recent reference to increasing taxes on the rich if he’s re-elected. I’m increasingly confident he will be, unless there’s a new financial crunch before November – and may even get a more Democratic Congress.

    *Hungary’s government already verges on fascism, and there’s a real possibility of the outright fascists of Jobbik coming to power if its economy collapses, as it may well do.

  • matty1

    I lived in the UK for the first 30 years of my life (pre-Thatcher), and I really miss ‘European Socialism’ (or at least British Socialism).

    So do a lot of Brits.

  • harold

    I’m not a big fan of Sullivan most of the time, but interestingly, he says –

    For me, the true test of conservatism is empiricism.

    That’s right, Andrew, the US so-called “Conservative Movement”, as defined by Fox/Limbaugh/the Tea Party/etc, is NOT “conservative” with a small “c”.

    In fact, denial of reality (scientific, historical, and economic) is one of its defining features. The others are irresponsibility (but they claim to value “personal responsibility” because they deny reality), corruption, and unremitting negativity (all their goals amount to an effort to harm someone whom they consider vulnerable and a claim that their supporters will benefit from this; if you disagree, name one overt US right wing policy that doesn’t involve harming some group of people, whether gays, the poor, the sick, the elderly, people in countries to be bombed, ethnic minorities, people who work for a living, etc, and I said “overt” – secretly giving sweetheart deals to cronies doesn’t count.)

  • Pierce R. Butler

    harold @ # 8: … and I said “overt” – secretly giving sweetheart deals to cronies doesn’t count.

    “Secretly”? So many of the crony contracts are public, that word doesn’t apply (though the ever-more-widely-known “black budgets” obviously flush money down the same pipes).

  • laurentweppe

    KG: The left was the dominant political force in Europe during the late 90’s, the right ruled the first decade of the millenium, so a continent wide alternance is to be expected, although many right-wing poliicians are trying to restart the old alliance between the conservative upper-class and far-right demagogues to stave off the their coming defeat.

  • Chris from Europe


    I expect the left to snatch defeat from the jaws of victory.

    For example, the German Social Democrats just announced that they don’t want to campaign against Merkel as person, instead they want to focus on better policies and fairness. I think it’s a mistake not to target the monster herself, especially as she’s about to make the design of the Euro even worse than her mentor, Kohl, could. Yet German news is full of anecdotes about waste and fraud in Greece.

    And I’m even a bit glad about the hate of the Greeks: Having a new target to hate, the German media forgot about the Turkish minority.

  • Michael Heath

    I recall some European countries’ metrics were doing quite well where non-conservatives were benchmarking their results to advocate we consider those successes when crafting U.S. policy. The conservative rebuttal was that those countries were socialist, we’re not nor do we want to be, enough said. So this argument is in play even these European countries are doing well. [One doesn’t have to ‘go socialist’ to learn from others, you still have to craft policy within our own context.]

    The U.K.’s current fiscal policy is one of the most carefully watched experiments when it comes to valid recessionary economic policies. Keynesian theory argues their current policy is contractionary to the point of doing net harm to the economy. The only claimed success I’ve seen coming from anti-Keynesians are two-fold:

    1) Successful monetary policy coming from Monetarists influenced by Milton Friedman.

    2) President Reagan and the corresponding Congress’s policies when he first entered office in a deep recession.

    Neither are valid defenses within our current context.

    Most economists and policy-makers have already adopted successful monetary policy prescriptions into their tool-kit. Our Fed follows monetarist policy now. That those originating right-wing policies have already been successfully incorporated into mainstream economic thought – while economists correctly point out that prudent governance allows monetarism and Keynesian fiscal policy to co-exist and in fact can be complementary. In fact, because central banks tend to be biased towards lenders at the expense of the labor market, it’s even more imperative to check monetarist polices with prudent fiscal policy from the national and state governments. In addition, monetarism as its normally executed is often limited in how much it can influence real growth in the short-term, especially in a deep recession, so the need for fiscal policy even when employing monetarism remains.

    The policies under Volcker, Reagan, and the corresponding Congress were confronted not just with a recession, but also inflation, “stagflation”. This sort of stagflation was increasing the price of goods and services more rapidly than wages. So besides high unemployment, even the employed were increasingly unable to purchase the same volume of goods and services they had previously because their net take-home pay was less due the inflation of goods and due to “bracket-creep”, they’re increased wages pushing them into higher marginal income tax rates which increased the share of their take-home pay going towards taxes.

    Stagflation hasn’t existed since then and makes this case study inapplicable to this down-cycle or most recessions. But because conservatives don’t care about reality, they frequently argue inflation is higher than reported and therefore we should obey their god Reagan regardless of the applicability.

  • laurentweppe

    For example, the German Social Democrats just announced that they don’t want to campaign against Merkel as person, instead they want to focus on better policies and fairness

    Don’t worry: promises of respectful campains are even more often broken than Newt’s pledges of eternal love and faithfulness.


    Yet German news is full of anecdotes about waste and fraud in Greece

    Well, the problem is that Greece is Europe’s first producer of public funds waste and fraud: this is a country which has already been directly administrated by its creditors during the late 19th, early 20th century because 75% of the money borrowed during the XIXth century had been embezzled by local poticians.

  • Chris from Europe

    Yes, Laurent, but these reports make it politically harder to justify help for Greece. The poor people there don’t deserve to pay for the powerful.

    It’s also crazy given our own experience with Brüning and the resulting political impact that Merkel insists on preventing even a little bit more inflation.

  • exdrone

    harold @5, be careful or raven will accuse you of being a “smug Canadian”.

  • laurentweppe

    The poor people there don’t deserve to pay for the powerful.

    Greek citizens are hardly blameless: the public funds embezzled did not merely go toward politicians’ bank accounts: they used this money to build vast clientelist networks, and Greeks deliberately voted for politicians who made sure that Greece’s fisc stayed embryonic, that Greece remained the only advanced country with no register of real estate, that European funds meant to fund infrastructures were used to artificially increase the salaries of public servants, etc…

    Greeks could be compared to American voters living close to military bases who keep sending representatives favoring the endless swelling of millitary budgets because it means more money in their pocket: sure, the politicians who keep demanding more millitary spending are to blame, but the people who put them where they are are hardly innocent themselves.


    That’s actually what’s really disgusting with Merkel and her coalition behavior: they turned an economic problem into a morality play where punishing the guilty party is now more important than fixing the economy. And they did so in order to demagogically accuse their critics of fraudster sympathies.