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Archive for November 30th, 2012

There are some races you don’t want to win.

I’m glad, for instance, that Greece instead of America is winning the race to fiscal collapse (though both the BIS and OECD predict the U.S. faces a bigger long-run challenge).

And I’m happy that California is farther down the path to chaos and meltdown than my state of Virginia (as illustrated by this amusing cartoon).

So you will understand that I am worried when a French socialist defends bad economic policy by saying that his country is copying the United States.

Here are some excerpts from a CNBC report about Obama being a role model for Hollande’s economic team.

“He’s not nearly as socialist as I am”

The French politician who said Indian steel company ArcelorMittal should leave the country has told CNBC that his government is only acting like U.S. President Barack Obama. Industry Minister Arnaud Montebourg, a member of the governing Socialist party, caused controversy last week when he said that the Indian company, which employs close to 20,000 people in France, should leave after it said it would have to close down a factory. The French government announced on Thursday that it could nationalize the factory in question… The news raised the specter of the nationalizations of the early 1980s, which were instigated by Hollande’s predecessor Francois Mitterrand. Montebourg told CNBC after a meeting with trade unions in Paris: “Barack Obama’s nationalized…” Montebourg brushed off comparisons with that era. He said: “It’s a very good sign to send out (to investors). Nationalizing is a very modern step to take. Especially when you not only nationalize losses but profits as well, when you make public/private partnerships. This is our strategy. …He declined to answer a question about comments from Mayor of London Boris Johnson, who told Indian businessmen earlier this week to come to London instead of France.

I don’t actually think we’re as bad as France, and the rankings from both Economic Freedom of the World and the Index of Economic Freedom both show the United States with more economic freedom.

But a good overall score doesn’t mean that one nation is better than another in all regards. The United States still ranks above Sweden, even though the Swedes have implemented school choice and personal retirement accounts. And America still ranks above the Slovak Republic, even though that country (at least for now) has a simple and fair flat tax.

So maybe Monsieur Montebourg is right about the U.S. being a trendsetter for bad industry nationalization policy. Gee, what a high honor. I guess this is what it means to be called ugly by a frog.

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Washington frustrates me. The entire town is based on legalized corruption as an unworthy elite figure out new ways of accumulating unearned wealth by skimming money from the nation’s producers.

But one thing that especially irks me is the way people focus on the trees and forget about the forest. Politicians and journalists are now engaged in an inside-baseball game of analyzing every twist and turn of the fiscal cliff negotiations.

That’s all fine and well, but perhaps it would be a good idea to talk about the need to fix the real crisis of excessive spending instead of arguing about how fast we should be traveling in the wrong direction.

And let’s not delude ourselves. In the absence of real entitlement reform, the United States is doomed to repeat Europe’s mistakes.

And how are things going in Europe? Well, I’m glad you ask. Let’s look at some excerpts from an Associated Press report.

Another month, another record unemployment rate for the economy of the 17 European Union countries that use the euro. Figures released Friday by Eurostat, the EU’s statistics office, showed that the recession in the eurozone pushed unemployment up in the currency bloc to 11.7 percent in October, the highest level since the introduction of the euro in 1999. …Eurostat found that 18.7 million people were out of work across the eurozone, an increase of 173,000 on the previous month and 2.2 million higher than the year before. The wider 27-nation EU that includes non-euro countries such as Britain and Poland had an unemployment rate of 10.7 percent in October and a total of 25.9 million out of work. …”Talk of a `lost generation’ of young people now looks like an alarming possibility,” said Andrea Broughton, principal research fellow at the Institute for Employment Studies.

In other words, we may complain about America’s miserable track record on jobs during the Obama years, but at some point in the future we may someday look back on 8 percent unemployment as good news.

Unfortunately, the crowd in Washington doesn’t want to acknowledge that the real problem is spending. And I’m particularly irked (but not surprised) that Republicans now seem willing to go along with Obama even though they won this fight back in 2010 when they didn’t control the House and had fewer seats in the Senate. Here’s what I said to one of the local DC stations.

I realize I’m sounding glum, so let’s close out this post with a couple of amusing cartoons about America’s European future.

I’ve already shared the “European Lemming” cartoon. This one has the same theme.

Cartoon Obama Iceberg

Other Eric Allie cartoons can be enjoyed here, here , hereherehere, and here.

And here another cartoon with the same theme.

Cartoon Obama Cliff

If you like this Bok cartoon, some of my other favorites can be seen here,  hereherehereherehere, and here.

If you still haven’t cheered up, this bit of Dave Barry humor about the European fiscal crisis is a classic, and I’d also recommend this bit of unintentional satire.

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