The European Left and the Fall of the Euro

My latest article in the American Thinker is up.  The essay focuses on the idea that Europe has somehow learnt from its mistakes and will now abandon the Euro and the European project as a whole.  It is the argument of the article that this thesis is false, and that the elites of the European governments have no intention of admitting their mistakes.  It is therefore necessary to understand that the bailouts will continue until the right can take control of individual national governments and slowly dismantle this failed project.

The article can be found in its entirety here.

Now Italy too?

Greece, Spain, Portugal and now Italy? Well, as bonds go beyond 7% it seems inevitable that they will need bailing out - if that is even possible, which many economists doubt.

What is so interesting about the downfall of the Italian economy is that it is one of the world's largest economies, and it has demonstrated just what a nasty machine the Euro is when it can take down a giant as big as Italy.

Certainly some responsibility lies at the feet of Berlusconi and his party - especially as it was under him that Italy went into the European project with a full throated cry - but it also shows just how false the promises of the New Europe were.

The idea was one enormous superstate with layers of government, "fair" taxes paying for more and more government projects, and a united currency encouraging everyone to, you know, just get along. How did that work out for you?

The result has been a continent submerged in debt, with too many free-lunchers and not enough people paying into the system. It is no coincidence that Italy is borrowing at 120% of GDP and is the third biggest borrower behind the US and Japan. It is entirely symptomatic of the continental mentality that has throttled the European economies.

What is truly frightening about this whole thing is that there is no reason why this can't happen to most EU countries, who have all been encouraged to borrow and spend beyond their means.

Two Prime Ministers have resigned this week. As the Eurozone falls deeper into turmoil, how many more will follow?

The Tories Are Lacking Principle

So, George Osborne has announced that there will be no new tax cuts before the next election. Hopefully Cameron will do another one of his Heath-like U-turns on this in the next year or so; if not, we won’t see the economy recover for the foreseeable future, and the Tories could get panned at the next election as a consequence.

No amount of massaging the figures can hide the obvious – our economy is stagnant. Granted, we aren’t in an economic crisis yet, but Britain is not moving forward in the way that we would like. This shouldn’t surprise anyone who adopts a conservative economic analysis. Britain’s specific economic problems are twofold – excessive spending and a dwindling private sector. It is a common myth that it is just “the deficit and debt” that are the problem. It is true that they are worrisome, but the enormous deficits are symptomatic of the real problem – excessive spending. Part of this spending problem is because our job-creating private sector is being scared abroad by oodles of red tape and high taxes, meaning we have to spend more money on unproductive public sector jobs and welfare.

Fixing the problem from a conservative (small c) perspective is simple – cut the spending (which we’ve already started to do, albeit slowly) and make Britain a more pro-business country, after hard-left socialists like Miliband, Cable, Balls and Brown have scared businesses away, or discouraged them from forming in the first place with their anti-business policies and taxes.

Therefore to most conservatives the answer is clear. Get us out of the EU – the number one source of stupid costs and red tape, cut useless spending projects, and limit government spending to the legitimate roles of government. Finally, cut taxes to a level that fosters the private sector and maximises revenue, not one designed to punish “the rich” and to try and redistribute wealth. This is the road to recovery and everyone with a conservative brain knows it.

Yet this is not a Tory party with a conservative brain; it is a party that is like an eighteen year old girl wanting to win X Factor. As a consequence it is more interested in what it looks like than doing the right thing; hence Cameron’s determination not to be seen as the party of those evil, horrible rich people.

If the Tories are the eighteen year old wannabe-singer, then the Lib Dems are the fat, loser friend that offers bad advice, convinced of their own self-importance because they happen to be friends with the popular girl. It is this useless, misguided friend that no-one likes anymore who is calling for property taxes, caps on bonuses, and the retention of the 50p tax rate on successful job-creators. The problem is that the Tories are listening.

Britain is a tired country, just like it was in the 1970’s, with unions too powerful, no private sector, high taxes propping up inefficient public sector industries, and too many people unable to find employment and stuck on welfare. Thatcher found a way out of this by following a pure conservative ideology, and by the end of the 80’s she had won three terms, and had turned Britain into a prosperous economic powerhouse.

The Tories can have the same success this time round, but only if they stop paying attention to their image and what people think of them in the short term, and stop listening to their annoying little friend that no-one else likes or cares about.

Osborne and Cameron have the opportunity to put Britain back on the road to prosperity – cut spending, reduce red tape, drop the EU, and cut taxes across the board to stimulate the private sector. Failure to do this will cost them the next election, and the blame with be on their shoulders. Unfortunately, from Osborne’s statements last week, it seems that they do not have the courage to do what they must.