Who Pays The Price?
From the desk of Richard Rahn on Sun, 2007-09-16 21:36
Alpbach, Austria. Nestled in the middle of the Alps, this is about as scenic as a place can be. The homes and lodges, all of which have the distinctive Alpine architecture, are graced with lovely hanging red and white flowers. There is no crime, no graffiti, no litter and no apparent poverty.
In short, it is the perfect place for the 63rd annual Alpbach European Forum, where many European opinion leaders gather each summer to discuss the problems of, and opportunities for, Europe.
Alpbach, of course, is no more representative of Europe than is the Disney-created town of Celebration, Florida, representative of America. They are both attempts to produce the ideal community.
Many conference participants seek to fashion their ideal version of Europe, yet fail to understand that the philosophers of the Scottish Enlightenment and the economists of the Austrian School (along with their University of Chicago comrades) many years ago set forth the rules that need to be followed for Europe and the rest of the planet to achieve peace, tolerance and ever-increasing prosperity.
Ironically, America learned the lessons from these Europeans better than did Europe, and now many Asians are learning them and becoming ever freer and more prosperous as a result. When Britain and America went off the tracks, they were saved by Margaret Thatcher and Ronald Reagan, both of whom knew and understood the teachings of Chicago's Milton Friedman and Austria's F.A. Hayek.
Yet today, many in Europe claim they have a more humane economic system than one with the rough edges of American style capitalism. However, the data show a very different picture.
Average per capita incomes in the Euro area are about a third lower (on a purchasing power parity basis) than in America, and unemployment rates are on average about 50 percent higher.
According to a report, released by the International Labor Organization Sept. 2, "The U.S. still leads the world by far in labor productivity per person employed." Moreover, European labor policies discourage employers from hiring. Once hired, the average European worker faces a larger tax burden and higher prices than his or her American counterpart.
The price of these "compassionate" policies is paid by those who cannot find jobs, particularly the young, and by those with jobs in the form of lower real incomes.
Austria, and Vienna in particular, lacks efficient "big box" retailers, such as Wal-Mart. I was told by a self-described leftist Austrian journalist that Wal-Mart-type stores conflict with "Austrian social values" and would hurt the existing retailers.
I asked her why making the poor pay more for basic goods was desirable since lower-income Austrians pay a disproportionate cost of this so-called Austrian value.
(One acquaintance at the Forum, who lives in Vienna, told me he and his wife find it pays to drive to Budapest - a five-hour round trip - to shop in the "big box" stores there. How ironic, the former communist country of Hungary is now more capitalist than Austria and many other West European nations.)
The typical poor person in America has more living space than the average resident of Paris or Vienna.
This same left-leaning journalist, who had spent time in America, also told me she had disliked Ronald Reagan. When I asked why, she said he was a warmonger, and his economic policies hurt Americans.
I then explained his policies helped end the Cold War, without a shot fired, and that Americans of all income levels experienced record increases in real incomes and full employment, without the high inflation he inherited.
She countered with: "He put Pershing missiles in Europe and gave aid to the Nicaraguan Contras." I then explained how those policies were part of the successful strategy to defeat the Soviet Union, which ended the Cold War.
Anti-Americanism is rampant among the media and political classes in Europe. It appears to stem from jealousy, ignorance - much of it studied - and irresponsibility.
For instance, Austria still has not joined NATO, and even the NATO members of Europe fail to pay their pro-rata share for the common defense.
The American taxpayer has paid the price for defending Europe for the last 60 plus years, yet too many Europeans seem not only unable to say "thank you" but pride themselves in disparaging their protector.
Europeans love to lecture the rest of the world about global warming, yet fail to meet their own self-imposed Kyoto protocol targets. The political and environmental elites advocate policies whose price will be paid by workers in India, China, America and even Europe, but not by themselves. They refuse even to do an honest cost-benefit analysis.
The world improves though the efforts of productive workers and entrepreneurial people who only wish to better their own lives and those of their families.
Unfortunately, these productive people have to pay a very steep price to fund the endless nonproductive tax and regulatory schemes of the European and to a lesser extent American political, media and academic elites.
This piece was originally published in The Washington Times on 12 September 2007.
@ bd
Submitted by Geraldo on Mon, 2007-09-17 12:58.
"But it may just begin with an Islamic uprising.
Then civil war."
If we let things go this is granted anyway.
We can try prevent this from happening.
But if we are not able to prevent that the sooner it happens the better.
In Reply to Mr. Rahn on Reagan
Submitted by Kapitein Andre on Mon, 2007-09-17 07:39.
Rahn: This...left-leaning journalist...said he [Reagan] was a warmonger, and his economic policies hurt Americans. I then explained his policies helped end the Cold War, without a shot fired, and that Americans of all income levels experienced record increases in real incomes and full employment, without the high inflation he inherited. She countered with: "He put Pershing missiles in Europe and gave aid to the Nicaraguan Contras." I then explained how those policies were part of the successful strategy to defeat the Soviet Union, which ended the Cold War.
The Soviet bloc would have collapsed without the efforts of the Reagan administration. Note that the Russian Federation retains a massive nuclear arsenal and - its ascent in the global economy and the almost authoritarian rule of its current president notwithstanding - as much domestic instability as ever. Furthermore, its financial, logistical and moral capabilities to expand socialism worldwide would also have inevitably declined.
Recently declassified CIA documents indicate that Reagan deliberately embarked on a campaign to probe Soviet military readiness, with a series of exercises and smaller maneuvers that showed gaps in Soviet radar coverage. During the hospitalization of either Andropov or Chernenko, anxious Soviet leaders were certain that the United States was preparing for a first strike. This caused them to launch not only a major KGB and GRU operation to ascertain Western intentions, but to build up themselves. In fact, the CIA regards these tensions during Reagan's presidency to have been more serious than the Cuban Missile Crisis, and which were most likely behind the downing of the Korean airliner.
While Reagan's economic policies were sound, his military, intelligence and foreign policy decisions were foolish and resulted in immense economic burdens to the American public e.g. re-activating useless Second World War-era battleships. However, Reagan ultimately should be seen as more of a traditional conservative than a neo-conservative and his impact on Americans' sense of patriotism and pride, largely byproducts of his charisma, should not be ignored.
I will not discuss the Iran-Contra affair as the Soviet Union, China and Cuba were actively aiding communist governments and rebel movements throughout the Third World, although apparently not necessarily in concert. Not every capitalist is pro-American or every communist pro-Soviet, however, how could the United States prevent Cuba from orchestrating regime changes without resorting to similar tactics?
persistent welfare state
Submitted by pashley on Mon, 2007-09-17 07:00.
my best example of a persistent welfare state was ancient Rome, whose bread was subsidized for centuries to keep the proles down. I read somewhere that the bread subsidy outlived the empire and the fall of Rome, and only ended in the 6th century when Justinian wasted the entire peninsula trying to reconquer Italy.
Interesting longun45
Submitted by bd on Mon, 2007-09-17 04:57.
But it may just begin with an Islamic uprising.
Then civil war.
It's time to crush the system
Submitted by longun45 on Mon, 2007-09-17 02:13.
To crush the system you must apply to get all of the aid you can. Then reject some or all of it as being below human, then reapply. The liberals must be demanded to deliver more and more services and then more must be demanded. The system must be bankrupted by the crushing weight of applications for state aid. Employers must demand training for workers before hiring them The training should be onerous as possible. They must demand price supports so there can be no competition. They must further demand that the government give them lower cost raw goods with out VAT taxes. Then with labor and taxes as high as the sky, the business should then close up shop and cause massive unemployment that will further drain resources.
I know this is distasteful, but short of starting shooting there is nothing else to do. The other way is hard and one must give up everything to win.
The government now has so many laws that they can be effectively strangled with their own rope.
Adopt the leftist tactics and beat them with their own stick until they are dead.
Who Pays The Price? This
Submitted by Geraldo on Sun, 2007-09-16 21:55.
Who Pays The Price?
This is the question of an old joke.
If you want to know if someone if from the right told him about idealist, wisefull, leftist folly.
The right guy ever ask: "WHO PAYS?"