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European Elections Harbinger of US Elections

Europe’s election results are in. Here are some of the headlines from Drudge followed by my comments:

What this really means will become more apparent as time unfolds. Two preliminary thoughts regarding the underlying motives are the following:

  1. This is a revolt against incumbents, much like the 2010 election in the US.
  2. This is a move further toward socialism by an already highly socialized part of the world.

Both hypotheses are reasonable. They may also not be mutually exclusive.

Europe differs from the US in many ways economically. For decades their economies have been plagued by sub-par growth. This is the cost of socialism, whether socialists want to admit it or not. The economic difficulties in Europe are not trivial by any means. But they are not that unusual where stagnation has been a way of life for many for several decades. What is new was the political attempt to roll back socialism. This rollback is necessary because the Lady Thatcher break point has been reached:

The problem with socialism is that eventually you run out of other people’s money.

That is where many of the countries in Europe find themselves. When that point is reached, at least a partial dismantling of the welfare state must take place. Cuts in programs are what is referred to euphemistically as the “austerity” approach. Realistically, it is the only course for Europe (and the US). Europe is broke (and the US soon will be).

Too many Europeans have lived in their socialist cocoon for so long that they believe it can continue. To them, this election was just another choice between political philosophies. The incumbents recognized the need to lower spending because there is no more money. Their opponents ran on the platform that the fantasy can continue. To the extent that voters believed that they were being asked to suffer when they there is no need to change course, the choice was simple — vote out the incumbents who are advocating lowering their living standards.

At least a couple of generations in Europe know nothing other than cradle-to-grave socialism. For them, it is the way the world works and has always worked. They have planned their lives on this worldview and are entitled to the benefits they were promised. If electing politicians more socialistic than the recent ones is perceived as the way to maintain these benefits, then they want more socialism rather than less. As H. L. Mencken observed:

Most people want security in this world, not liberty.

Unfortunately the security they thought could be provided by government is no more. Continuing the current condition is not possible. THERE IS NO MORE MONEY! And without money, government can provide nothing.

Markets, as I near the conclusion of this piece, are Claude Rains “shocked!” Dow Futures are off 130 points or about 1%. Major Asian exchanges are off around 2%.

The implications for the elections in Europe likely portend what will happen in the US. The revolt against incumbents is good news in that it will sweep Obama and a lot of other dead wood out of office. The bad news is that the newcomers will be placed in the position of Sarkozy and other incumbents. They will have to address the insolvency and eventual liquidity issues in similar fashion, with what will be viewed here as “austerity” or worse, “cruel and unusual” punishment. I don’t see Romney and other newly elected politicians willing to commit the political suicide that we have just witnessed in Europe. Politicians, by nature, are not courageous animals.

Instead we will see the usual half-assed attempts to fool the people into believing that something is being done to solve the problems. Eventually, it will be too late to pretend and extend and we will be in Europe’s position where it must be done. That is apt to make the election after 2012 look as socialistic as yesterday’s European elections.

3 thoughts on “European Elections Harbinger of US Elections”

  1. Amen to that. France and Greece just voted in people who vowed they would continue to keep spending money they don’t have hastening their sovereign bankruptcies and removing any hope of a bail out from Germany. There is NO connection with reality. What part of BROKE do they not understand?

    These electtions results mean the following:
    1) The EU is done. Germany will not bail out these idiots so the idiots will have to leave the EU in order to print worthless currency to try to get out of their debt crisis
    2) The Euro is done as a currency
    3) The collapse is coming sooner than later as they voted to step on the accelrator rather than the brake as they approached the cliff.

  2. Another fine article Monty. I know we’ve all be bashing our political class for the past few years and rightly so, but there are still some differences between us and Europe. Americans are armed and most are “mad as hell”, and we are a lot more independent minded than the typical European castrated drones. There is still an American “character” or characteristic which the Europeans lost following WWII, a will to survive amongst at least half our population and the ultimate means to survive.

    Having said that, I still believe, or I would dare say know, that our current configuration is doomed and our collapse will come sooner than later. The question is, will our constitution survive and I believe it will whether in The United States or These United States remains to be seen.

    What works in our favor is that most parasites are jammed into our third world cities (your post on Detroit for example) which will burst into flames when the end comes ridding us of millions of parasites. Our military is still patriotic (though I will admit that is rapidly changing). The over fifty percent who are still American will not stand for a socialist distopia. It may ulimately be up to one state to take a stand and lead the charge in forging a new nation if it comes to that and there are millions of us out here who will support that cause.

    1. I agree. The parasite class will never see the ciris coming as they were too busy watching “The Voice” or whatever distraction du jour. They will, however, still feel entitled to YOUR property and will decide to take it by force. The problem is two fold for them:

      1) We’re preapred and well armed
      2) These aren’t sophisticates so they’ll go after their “ghetto rich” neighbors first meaning they’ll kill each other off in droves

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