All of this is unfolding in an economy that can no longer be understood, even in passing, as the Great Society vs. the Gipper. Whether we like it or not—or even whether many people have thought much about it or not—the numbers clearly suggest that we are headed in a more European direction. A decade ago U.S. government spending was 34.3 percent of GDP, compared with 48.2 percent in the euro zone—a roughly 14-point gap, according to the Organization for Economic Cooperation and Development. In 2010 U.S. spending is expected to be 39.9 percent of GDP, compared with 47.1 percent in the euro zone—a gap of less than 8 points. As entitlement spending rises over the next decade, we will become even more French.
Ok, I admit I’m taking the title does not represent the article. The Newsweek article simply stated that as more and more babyboomers reach retirement age our entitlement spending will grow. As other problems arise, health care or fuel for example, the government will be forced to spend again. The article suggests we should just except this fact and move on. Does that sound right to you? It shouldn’t.
I don’t mind the government spending if it is smart spending. Newsweek seems to be advocating a spend spend spend government. I give you this analogy. Newsweek has a car. nearly every other month the car is in the shop. $200 here $400 there. They keep going through these small patches until finally the car craps out. Unfortunately for Newsweek, because they were spending to keep fixing the car they never saved enough to afford a new one. That is what they would have us to with our government. Just keep tossing cash around instead of truly fixing problems.
Bush tried it with his bailout and other spending during his administration. I think it’s clear how that turned out. We thrown money at our education system for years. Still our children are not meeting standards and districts still have their hands out. Pension payouts helped tank the big three auto makers. Putting more money into Social Security will not stop the looming shortage.
We need reform and strategic spending not blanket spending. Even Sweden has partly privatized it’s social security. Common sense and cool heads are what we need now. At the end of the Newsweek piece they say, “the catch is that more government intrusion in the economy will almost surely limit growth (as it has in Europe, where a big welfare state has caused chronic high unemployment). Growth has always been America’s birthright and saving grace.”
This is why we are not, and will never be, a socialist state, or even a welfare state like France. We will not be limited. Our individual ambitions will not be stifled. Americans don’t just break glass ceilings. We obliterate them. That is what gets us ahead.
I think de Tocqueville said it best
Democracy and socialism have nothing in common but one word, equality. But notice the difference: while democracy seeks equality in liberty, socialism seeks equality in restraint and servitude.