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Socialism's effects on German's economy

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Seems we can learn by observing current economic quagmires created by the Crazy "intellectually elite." 

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"By the time Germans decide, it'll be too late
By Mark Steyn
(Filed: 20/09/2005) 

"If you want the state of Europe in a nutshell, skip the German election coverage and consider this news item from the south of France: a fellow in Marseilles is being charged with fraud because he lived with the dead body of his mother for five years in order to continue receiving her pension of 700 euros a month.

She was 94 when she croaked, so she'd presumably been enjoying the old government cheque for a good three decades or so, but her son figured he might as well keep the money rolling in until her second century and, with her corpse tucked away under a pile of rubbish in the living room, the female telephone voice he put on for the benefit of the social services office was apparently convincing enough. As the Reuters headline put it: "Frenchman lived with dead mother to keep pension."

That's the perfect summation of Europe: welfare addiction over demographic reality.

Think of Germany as that flat in Marseilles, and Mr Schröder's government as the stiff, and the country's many state benefits as that French bloke's dead mum's benefits. Germany is dying, demographically and economically. Pick any of the usual indicators of a healthy advanced industrial democracy: Unemployment? The highest for 70 years. House prices? Down. New car registration? Nearly 15 per cent lower than in 1999. General nuttiness? A third of Germans under 30 think the United States government was responsible for the terrorist attacks of September 11.

While the unemployment, real estate and car sales may be reversible, that last number suggests the German electorate isn't necessarily the group you'd want to pitch a rational argument to. In the run-up to the election campaign, there were endless references to "necessary reforms" and "painful change". And, in the end, the voters decided they weren't in the mood for change, especially the painful kind.

It was Angela Merkel's election to lose, and she certainly did. She did a swell job selling herself to foreign capitals as the radical reformer Germany needed. Alas, when it came to putting the same case to her own people, she balked. By the end of the campaign, she was promising little more than some slight tinkering, and even that proved too much for great swaths of eastern and central Germany.

Back in the summer, I was reprimanded by a couple of Euro-grandees for my gloomy assessment of the Continent. Just you wait, they chided me; Mrs Merkel was "Germany's Thatcher" and this chap Sarkozy was "France's Reagan" and in a year's time the entire political scene would be transformed. I couldn't see it myself. Mrs Thatcher and President Reagan were certainly powerful personalities, but 25 years ago they also had electorates who accepted that the status quo was exhausted and unsustainable. The Germans are nowhere near that point.

In fact, insofar as there's been any trend in recent regional and European elections, it's that voters were punishing Mr Schröder's party even for the very modest reforms to which he was committed: they're not at the Thatcher stage, they're more like those council workers who reacted to Jim Callaghan's call for a limit of five per cent pay increases by demanding 40 per cent. According to recent polls, 70 per cent of Germans want no further cuts in the welfare state and prefer increasing taxation on the very rich. In April, only 45 per cent of Germans agreed that competition is good for economic growth and employment.

In other words, things are going to have to get a lot worse before German voters will seriously consider radical change. And the question then is whether the Christian Democrats will be the radical change they consider: as Sunday's results in east Germany indicate, it's as likely if not more so to be ex-Commies or neo-Nazis or some other opportunist fringe party. The longer European countries postpone the "painful" reforms, the more painful they're going to be.

That being so, a serious "reform" party ought not to be propping up the status quo. The Christian Democrats have nothing to gain from joining the SPD in a grand coalition of all the no-talents. All that would happen is that blame for the ongoing sclerosis would no longer be borne by Mr Schröder alone but could be generously apportioned to Mrs Merkel, too.

Meanwhile, the Greens and the new Left party would become the principal opposition and the last thing Germany needs is to rearrange its political dynamic as a choice between the status quo and the far Left. So my advice to the Christian Democrats would be to sit this one out. You're only going to get one shot at fixing the country and a neither-of-the-above election where no one has a mandate for anything isn't it.

Which brings us back to that nonagenarian corpse in the Marseilles flat: what does it take to persuade the citizens of "enlightened" social democracies that sometimes you've got to give up the benefits cheque? Guardian and Independent types have had great sport with America over the last couple of weeks, gleefully citing the wreckage of New Orleans as a savage indictment of the "selfishness" of capitalism.

The argument they make is usually a moral one - that there's something better and more compassionate about us all sharing the burden as a community. But the election results in Germany and elsewhere suggest that, in fact, nothing makes a citizen more selfish than lavish welfare and that once he's enjoying the fruits thereof he couldn't give a hoot about the broader societal interest. "Social democracy" turns out to be explicitly anti-social.

Old obdurate Leftists can argue about which system is "better", but at a certain point it becomes irrelevant: by 2050, there will be more and wealthier Americans, and fewer and poorer Europeans. In the 14th century, it took the Black Death to wipe out a third of Europe's population. In the course of the 21st century, Germany's population will fall by over 50 per cent to some 38 million or lower - killed not by disease or war but by the Eutopia to which Mr Schröder and his electorate are wedded.

On Sunday, Germany's voters decided that, like that Frenchman, they can live with the stench of death as long as the government benefits keep coming."

http://www.telegraph.co.uk/opinion/main.jhtml?xml=/opinion/2005/09/20/do2002.xml&sSheet=/opinion/2005/09/20/ixop.html

Entry #71

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