CoryJorgenson444

Politics Versus Economic Reality: We Will All Lose

In the West there's quite obviously a battle between the politics and the economics. It is clearest is Europe where - all most as you - the economists say the Euro is condemning many to long-term austerity and inevitable poverty and is therefore unworkable - but somehow the politicians don't appear to get it: or will they think the choice is worse? And also the reason for this problem is most of all the resolve for excessive government spending primarily driven by the welfare state. And in the USA, that great bastion of free enterprise and also the American dream, is incorporated in the middle of a battle to bring the very same welfare state to those shores whilst ignoring escalating public debt.

In Democracy in America (published in 1835 in France), Alexis de Tocqueville wrote "The American Republic will endure before the day Congress discovers that it can bribe the general public using the public's money." Which seems to be happening today. De Tocqueville is interesting because at that time France, and indeed the remainder of Europe had primarily aristocratic rule and he would be a liberal who supported the idea of democracy. But he was worried about the long term effect of this democracy on sensible economics: "From that moment on, the majority always votes for the candidates promising the most benefits in the public treasury which means that a democracy always collapses over loose fiscal policy."

A fascinating rise in the EU - inside a desperate make an effort to save the Euro - has decreed that member states must have a well-balanced budget. Obviously the main reason they did not possess a balanced budget was because politicians wanted to bribe their voters and or their financiers (these day almost exclusively big corporate).

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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 consider the possibility of leaving the Euro resulted in their instant removal by scheming EU apparatchiks as well as their replacement by so-called Technocrats. If the EU has its own way I suspect the Greek election due soon will be postponed as will any other election that threatens a vote which will destabilise the union.

Of course the total absurdity from the EU is whilst it clamps down heavy heavily on rising budgets in EU members states its 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're spending towards the voters and ever aspire to be elected again? Clearly the very first prerequisite is that the politicians are willing after which can make the argument - and win it - with their voters. Nowadays, with politicians who use opinion polls rather than conviction his or her guiding light, that seems a large ask. Or perhaps is it conviction of the wrong kind - a conviction towards the liberal democratic model that believes their state should 'take care' from cradle to grave. The problem in america seems to be the most peculiar - with Europe to illustrate what goes on when an excessive amount of is spent of social largesse it is extraordinary the united states seems to be following the same model. You don't have to be considered a member of the Tea Party to see something must be done about US government spending - and surely the priority ought to be obtaining the budget balanced before adding to it!

Britain's electorates dependence on the NHS (free healthcare) is definitely an example of the issues of trying to change something that is sacred cow - yet most accept it is not efficient. Even talking about NHS reform has government pollsters inside a lather of despair.

So in the western world the politics is ruling the roost: maybe we ought to say the little head is ruling the large head because when everyone knows that economics is like a river: it can be dammed, diverted and siphoned however it keeps coming and in the end those trying to stop it must be overwhelmed.

The question is when will economics win? I grew up in Eastern Europe after economics eventually won the Cold War. That suggests to me Europeans will eventually be residing in some form of protected enclave where those outside have the most recent 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 reality is as to have state spending - we have to generate enough wealth to finance that spending. That is the economics from it. Furthermore that wealth should also must grow and become readily available to reinvest in new projects to create more wealth to help keep paying the bills. Within the socialist/communist system the necessity to invest is ignored and inefficiencies sidelined within the have to maintain the system.

In the united kingdom the Blair/Brown years saw a vast numbers shuffled onto welfare dependency often called disability. It was exactly the same towards the communist regime allocating every new member from the workforce employment - whether or not 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 the same - less and less money for investment and for that reason fewer, and eventually no new jobs.