It's more like our problems created by unregulated banking is now being reflected in Europe's problems with unregulated banking.

Europe has a black moslim Kenyan usurper too?

The problem is conservatives/republicans don't want to actually reduce spending they just want to privatize it. So you're at an impasse because liberals don't want to see social services privatized and the cost burden shifted onto the poor and middle class and conservatives don't want to try to fix and streamline the programs because that would mean government can be effective.

Soak the rich.

FlashHarry: you mean that we need to strengthen the federal government and rein in the states -- especially those who take more federal money in than they contribute in taxes?

who do you want to "rein in the States"?

California is the next Greece, but it is their responsiblity to rein themselves in, not the Feds.

europes problem is a bunch of countries with a shared monetary system but not a shared any other aspect of government. its really nothing like our nonsense.

Ignoring the part where austerity budgets have made a bad situation even worse? We certainly are.

odinsposse: It's more like our problems created by unregulated banking is now being reflected in Europe's problems with unregulated banking.

Strange.

Um....the welfare state? Isn't Germany bailing (or choosing not to anymore) out the rest of Europe? Last time I checked Germany had both a sound social security plan and basic medical coverage and were still profiting. Perhaps it had less to do with "socialism" and the welfare state, and more to do with the fact that while we moved our manufacturing to China, they developed a transition model to adjust the skills needed for the market.

/Not saying we need to retain the manufacturing that we exported, but we dumped an entire sector of the economy and didn't replace it with anything. Ironically, high skilled manufacturing is needed in the US, yet we have not developed programs to fill this.

Ned Stark: europes problem is a bunch of countries with a shared monetary system but not a shared any other aspect of government. its really nothing like our nonsense.

Yeah, I'm rather inclined to agree. Although the US and Europe are facing similar problems at a very, very high level, once you get into the particulars I'm not sure it's really accurate to call them parallel.

FlashHarry: you mean that we need to strengthen the federal government and rein in the states -- especially those who take more federal money in than they contribute in taxes?

And not to mention the failure that is austerity (as qorkfiend mentioned too).

And the follow of attempting to go back to a Gold Standard of any sort (what the Euro essentially is) no matter what RON PAUL says.

I live in Germany, so I'm getting a big kick out of...

Thats No Moose: FlashHarry: you mean that we need to strengthen the federal government and rein in the states -- especially those who take more federal money in than they contribute in taxes?

And not to mention the failure that is austerity (as qorkfiend mentioned too).

And the follow folly of attempting to go back to a Gold Standard of any sort (what the Euro essentially is) no matter what RON PAUL says.

FTFM

NINDroog: Um....the welfare state? Isn't Germany bailing (or choosing not to anymore) out the rest of Europe?

To some degree. On the other hand, Germany is also learning firsthand what it is like to be taken crass advantage of, not by the needy who need a hand up, but by the self-destructive who need a swift kick in the butt. As a nation it is (rightly) getting sick of it, but it's also finding that the dependent will fight to maintain their current enablers.

Europe's problem is that their supranational governing system is a confederation with virtually no powers. We discovered that confederations don't work very well back in the 1780's and switched to a federation with a stronger central state, and it took us over 100 years to finalize that switch through ratification of the 14th Amendment and incorporating the Bill of Rights to the states. Eventually, Europe will figure this out and voluntarily give up some of their sovereignty to the EU to strengthen the ties that bind them together and make them all stronger. I'd bet that we'll be calling it the United States of Europe before I die.

/unless I die of accidental causes within the next few years

Well, the part where Friedmanite economic policy has laid waste to every EU country where it has been implemented in a large scale (hint: Those PIIGS? Three of five of them bought the rightist line wholesale, and one had a de facto optional tax system like the libertarians occasionally try to present as a good idea) is certainly comparable to the US, where Friedmanite economic policy has farked us for 30 years or so.

"a bunch of countries with a shared monetary system but not a shared any other aspect of government."

Isn't this the modern US Conservative dream? To weaken the federal goverment, strengthen the rights of the States to legislate as they see fit, and somehow a stronger US Dollar will result from the Balkanization of fiscal policy?

qorkfiend: Ignoring the part where austerity budgets have made a bad situation even worse? We certainly are.

And for at least Greece and Italy we have learned that maintaining a high percentage of the population in inefficient government jobs while providing a goodish governmental pension plan all proped up by deficit spending is no way to go through life. Maintaining that staus quo would have not help them crawl out of the large debt hole also. Damned if you do damned if you don't.

Europe's problem is not the 'welfare-state-bad' problem. It's the Euro and the inclusion of states that never should have been included in the first place.

France and Germany, two of the greatest examples of the Social Welfare state, are not nearly so bad as people would think. People aren't worried about them, but their linkage to nations that done farked up.

Europe's problems DO include lower birthrates, some exceptionally farked-up cultural tendencies of tax-dodging, incredibly poor book-keeping, international banking sector's shenanigans, etc.

The European Bond Market panic is due to inherent weaknesses in the practical realities of the shared Euro rather than any inherent weakness in the function of a social welfare state.

This is not a reckoning of the Social Welfare State, but of high-finance having drifted from 'amoral' conduct into 'immoral' conduct.

Millennium: NINDroog: Um....the welfare state? Isn't Germany bailing (or choosing not to anymore) out the rest of Europe?

To some degree. On the other hand, Germany is also learning firsthand what it is like to be taken crass advantage of, not by the needy who need a hand up, but by the self-destructive who need a swift kick in the butt. As a nation it is (rightly) getting sick of it, but it's also finding that the dependent will fight to maintain their current enablers.

Really? Their massive trade surpluses with their southern neighbors had a little something to do with their current prosperity. Don't buy the BS that Germany hasn't benefited mightily over the last ten years from the profligacy of their neighbors.

/Also don't buy the BS that all of their neighbors have been profligate. The Spanish have one of the best budget situations in all of Europe yet they too are now getting hammered as if they were Italy.

Farxist: FlashHarry: you mean that we need to strengthen the federal government and rein in the states -- especially those who take more federal money in than they contribute in taxes?

who do you want to "rein in the States"?

California is the next Greece, but it is their responsiblity to rein themselves in, not the Feds.

That's the attitude that's making a mess of Europe (and the US): Fark you, I've got mine.

GAT_00: Do we have a state who's debt is going to destroy the Dollar?

Now the sentence matches the punctuation.

NINDroog: Um....the welfare state? Isn't Germany bailing (or choosing not to anymore) out the rest of Europe? Last time I checked Germany had both a sound social security plan and basic medical coverage and were still profiting. Perhaps it had less to do with "socialism" and the welfare state, and more to do with the fact that while we moved our manufacturing to China, they developed a transition model to adjust the skills needed for the market.

/Not saying we need to retain the manufacturing that we exported, but we dumped an entire sector of the economy and didn't replace it with anything. Ironically, high skilled manufacturing is needed in the US, yet we have not developed programs to fill this.

I worked for a start-up in Germany ten years ago. The German government was matching VC funding for high tech at a rate of 10:1 in Berlin anyway, I don't know about the country as a whole. In other words if you could attract one million euro in investment, you could spend eleven million.

There are good US programs for filling the gap but when a country goes crazy for military spending it gets what's coming to it. And all that money wasted on foolish military contracts plus the unfunded Bush tax cuts for the wealthy are what has caused the US problems, not payroll tax funded programs like Social Security and Medicare.

NINDroog: Um....the welfare state? Isn't Germany bailing (or choosing not to anymore) out the rest of Europe? Last time I checked Germany had both a sound social security plan and basic medical coverage and were still profiting. Perhaps it had less to do with "socialism" and the welfare state, and more to do with the fact that while we moved our manufacturing to China, they developed a transition model to adjust the skills needed for the market.

/Not saying we need to retain the manufacturing that we exported, but we dumped an entire sector of the economy and didn't replace it with anything. Ironically, high skilled manufacturing is needed in the US, yet we have not developed programs to fill this.

Exactly.

Real Clear Politics lacks a fact checker. A fact checker would have reminded Samuelson that the crisis came about because out of control lending by bankers who somehow could not recognize the huge housing bubbles in the United States and much of Europe that created the largest asset bubble in the history of the world. This is a story of a broken private sector and/or too little government regulation.

Dean Baker (new window)

Too many women in Europe don't use a razor.

I'm seeing the same thing at Occupy protests.

The parallels are frightening.

If this is socialism, count me out.

Millennium: As a nation it is (rightly) getting sick of it, but it's also finding that the dependent will fight to maintain their current enablers.

Fair enough point. But that is not because they have beneficial social policies at home, but because some states in the EU were not spending wisely or developing themselves (Greece). Others have done and excellent job benefiting from EU membership (Poland). Either way, it's still not the fault of domestic German policies. It's also a little disingenuous to imply that countries which had decent social policies are in the red entirely because of socialism, there was that pesky billions (or trillions?) of dollars of wealth that just disappeared when the world economy crumbled.

eiger: Really? Their massive trade surpluses with their southern neighbors had a little something to do with their current prosperity. Don't buy the BS that Germany hasn't benefited mightily over the last ten years from the profligacy of their neighbors.

At what point did I say that they didn't benefit from the system? Of course they did. And yes, that has helped them currently. I would never expect a country to act altruistically. However, when the EU boom was going on, they had wise spending policies and prepared for the future. Others did not. Once again, this is aside from my point that social spending policies are the absolute cause of the current EU crisis. I would still argue that some of Germany's policies contributed to exactly the opposite.

Germany needs to STFU (new window)

If anyone knows about getting by on massive debt relief, it's them.

I do hope Obama is listening.

When "socialism" and the "welfare state" succeed in other countries, it's not applicable to the U.S. because the situations are different. Geography, natural resources, and differences in populations contribute to the fact that America is just different. More than that, it's exceptional.

When "socialism" and the "welfare state" fail in other countries, it's wholly applicable to the U.S. because the sky is blue, water is wet, and you just can't see that because you're a stupid lib.

This isn't rocket surgery, people.

Delay: Real Clear Politics lacks a fact checker. A fact checker would have reminded Samuelson that the crisis came about because out of control lending by bankers who somehow could not recognize the huge housing bubbles in the United States and much of Europe that created the largest asset bubble in the history of the world. This is a story of a broken private sector and/or too little government regulation.

Dean Baker (new window)

I really like Dean Baker. It's fun throwing his name around when people insist that we should only listen to economists who predicted there was a housing bubble. You can practically hear the gears grinding to a halt in their heads as they try to figure out just how to respond.

At least this will end talk about how we should be more a socialist welfare state like Europe.

odinsposse: It's more like our problems created by unregulated banking is now being reflected in Europe's problems with unregulated banking.

You keep using that word, unregulated. I don't think you know what it means.

NINDroog:

At what point did I say that they didn't benefit from the system? Of course they did. And yes, that has helped them currently. I would never expect a country to act altruistically. However, when the EU boom was going on, they had wise spending policies and prepared for the future. Others did not. Once again, this is aside from my point that social spending policies are the absolute cause of the current EU crisis. I would still argue that some of Germany's policies contributed to exactly the opposite.

My point is that Germans seem to believe the solution is for everyone to "become like them" which is a mathematical impossibility. This belief on the part of the Germans is one of the major obstacles to finding a solution to the problem. Unfortunately, their leaders (like leaders in so many places) seem more interested in pandering to this self-satisfied German belief than telling them the hard truth that attempting to force the other countries in the EU to follow the German model is a recipe for disaster. They also consistently fail to explain to them the fact that they directly benefited from and (though various policies) caused the problems they so sanctimoniously now condemn.

I'm not trying to attack you personally (or even your point). You just spurred me sharing my thoughts on this matter because, frankly the German response to the problem is pretty disgusting and self-defeating. I'm trying to point out that too often people point to the "responsibility" of the Germans without also pointing out that their policies almost directly led to this point. Too often macroeconomics is discussed as a morality play of the responsible and irresponsible. This wouldn't be that bad except this narrative often leads to policies that attempt to punish the sinners and reward the righteous that often just end up punishing everyone rather than finding a pragmatic policy that actually leads to the best economic result for everyone.

The current German rulers are acting out a breathtaking failure of leadership. They are clearly prioritizing local domestic (misguided) opinion over educating that opinion about economic reality. This approach, if they continue to follow it, will almost inevitably lead to disaster for the entire continent.

Ultimately, the hard truth is that the euro can only survive with greater European integration, and, probably, massive financial transfers to the poorer and more profligate parts of Europe.

/On a side note, the euro is one of the best examples in ages of why the gold standard would be a disaster.

MyRandomName: odinsposse: It's more like our problems created by unregulated banking is now being reflected in Europe's problems with unregulated banking.

You keep using that word, unregulated. I don't think you know what it means.

Barney Frank kept telling us everything was fine.

FTFA: It's ultimately a crisis of the welfare state, which has grown too large to be easily supported economically.

THIS IS WHAT TEABAGGERS ACTUALLY BELIEVE!

Uncle Tractor: FTFA: It's ultimately a crisis of the welfare state, which has grown too large to be easily supported economically.

THIS IS WHAT TEABAGGERS ACTUALLY BELIEVE!

The welfare state works until no one will continue loaning you money.

Europe needs to be realigned into a loosely-adjoined, yet unified associations of Free Imperial Cities, Duchies, Grand Duchies, Marks and Principalities. Just like the good old days.

smitty04: Uncle Tractor: FTFA: It's ultimately a crisis of the welfare state, which has grown too large to be easily supported economically.

THIS IS WHAT TEABAGGERS ACTUALLY BELIEVE!

The welfare state works until no one will continue loaning you money.

Then America's welfare state should be humming along brilliantly since we can currently take out five-year and seven-year loans at negative real yields.

smitty04: The welfare state works until no one will continue loaning you money.

So you don't consider France or Germany to be a social welfare states?

And you actually consider the USA to actually be a social welfare state?

/a country being in debt has nothing to do with social programs you chucklefark

meat0918: Farxist: FlashHarry: you mean that we need to strengthen the federal government and rein in the states -- especially those who take more federal money in than they contribute in taxes?

who do you want to "rein in the States"?

California is the next Greece, but it is their responsiblity to rein themselves in, not the Feds.

We already did it twice. Once when we scrapped the Articles of Confederation, and again after the Civil War.

Some contend there was also a third time, around the time of the New Deal.

California's problem is similar, but it's not tax cheats, but an environment that has allowed them to expand spending but never expand revenue.

//That, and Prop 13. Its repeal or modification is coming.

Doesn't help that California still has to subsidize the red states. If we simply cut them off and took our money back, California's debt disappears overnight.