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2010-02-23 Europe

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Posted by Fred 2010-02-23 00:00|| || Front Page|| [11124 views ] Top

#1 Greece is the counterpoint to any Socialist screed about the failure of capitalism. At least with capitalism you have something left over to rebuild with.

Posted by Procopius2k 2010-02-23 07:51|| 2010-02-23 07:51|| Front Page Top

#2 In the second half of the 5th century BC, signs of weakening of the Greek society appeared, due to the slave exploit, the pauperization of the small producers etc.

Posted by Besoeker 2010-02-23 08:29|| 2010-02-23 08:29|| Front Page Top

#3 High debt and the welfare state are at odds.
I don't agree with the ambiguity in that statement. All welfare states depend on diversion of resources from somewhere else. The Nazi state had an elaborate welfare program for its favored beneficiaries, financed by theft and plunder. Greece's welfare was financed by taking out bad loans. Countries that are highly productive (for a time) can finance their welfare programs by taxing a slice of the new production, but when productivity falls, their debt balloons. Guess where that has happened.
Of course, when the debt gets high enough, it becomes difficult or impossible to make the welfare payments, and this happened after the USSR collapsed. Free lunch & all that rot.

Posted by Anguper Hupomosing9418 2010-02-23 10:48|| 2010-02-23 10:48|| Front Page Top

#4 But in practice, a bailout is proving hugely controversial. If Greece is aided, won't other countries demand -- or require -- rescues?

Isn't that exactly what causes socialism to fail again and again?

Posted by gromky 2010-02-23 11:01|| 2010-02-23 11:01|| Front Page Top

#5 And in related news, Governor Schwartznegger assures the state that this problem has "no comparison to Kaliforneeeah".

Posted by NoMoreBS 2010-02-23 11:04|| 2010-02-23 11:04|| Front Page Top

#6 The "welfare" state punishes success to reward failure.

Is it any wonder the economy dies wherever it's tried?

Posted by Bright Pebbles 2010-02-23 12:45|| 2010-02-23 12:45|| Front Page Top

#7 The problem isn't so much that the welfare state doesn't work, it's that left of centre governments continually increase the welfare 'bribes' to various groups in order to increase their constituency (ie votes).

It's a structural problem in a 1 person 1 vote democracy.

Right of centre governments try to increase the number of tax payers in order to counteract the trend, but its been a losing battle for the last 30 years.

The unfolding sovereign debt crisis will certainly require large reductions in welfare payments. It will be interesting to see if fewer welfare recipients and more taxpayers swings politics to the right for years to come. IMO it will.

Posted by phil_b 2010-02-23 17:19|| 2010-02-23 17:19|| Front Page Top

#8 its been a losing battle for the last 30 years.

It has been for the last 100 years.

I am far less optimistic than my distinguished co-commenter, phil_b. At no time in the last 100 years has the voting population swung to the right as indicated by reductions in welfare. Reagan reduced no welfare. Clinton did replace ADFC with TANF, effectively the transfer of responsibility for dealing with abuse to the states, and that is the closest we have come.
The people on the public teat are like crack addicts. And it's probably half the voters by now. I think Samuelson is correct:

It's an open question whether the collision will cause social and economic turmoil.

And I think it is questionable whether republican government or one-man-one-vote survives the coming violence. I would be happy to see a driver's license and a 1040 with tax due (whether paid by withholding or payable) being required to vote. But that ain't likely because those at the teat know the udder would dry up. I doubt a republican government can last 320 years.

Posted by Nimble Spemble 2010-02-23 18:35|| 2010-02-23 18:35|| Front Page Top

#9 I think the potential for social turmoil from large reductions in welfare is over done. Mostly because the welfare classes are mostly passive. If they weren't they probably wouldn't be on welfare. The demonstrators/rioters that show up at World Bank etc meetings are overwhelmingly the children of the affluent middle class, whose lifestyle is subsidized by their parents, and over paid/under worked union members.

But rest be assured large reductions in welfare payments are unavoidable and even then I doubt they will prevent soveriegn debt defaults.

Posted by phil_b 2010-02-23 19:41|| 2010-02-23 19:41|| Front Page Top

#10 I remember 1967 too well. Between the frightened, impoverished elderly voters, the angry inner city thugs, the agricultural welfare queens and the public employees including police and fire who will lie down on the job, I suspect we will have severe dislocation. We won't have default here. We'll have Weimar inflation.

I'd rather be in Perth if I have to suffer this.

Posted by Nimble Spemble 2010-02-23 19:47|| 2010-02-23 19:47|| Front Page Top

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