Whispers of yet another European bailout, more unauthorized, debt-financed largesse doled out at the expense of American citizens, has prompted strong reaction: Nearly four out of five oppose such a measure. The last known bailout granted by the United States to Europe of more than $600 billion was done secretly, without representative authorization.
The inability of states like Greece and Spain to reform their economies, instead of pointing their wagging fingers at Germany for being so stupid as to loan them money, should be a huge red warning sign not to extend the freeloaders any more credit. The United States’ economy is suffering significant distress at the hands of Obama and his wrecking crew, and any loans to the European beggars would be an immense waste of resources.
As our nation begins to resemble the United States of Europe, more so than the beacon of liberty we conservative types love, we have been taking on European-style economic statistics and embedding them structurally into our nominally capitalist system.
One way of showing how the United States is becoming more like Europe is comparing public debt levels. The U.S. recently surpassed debt-to-GDP of 103%, similar to Portugal’s (108.5%), Ireland’s (108.4%), and while short of Greece’s (165.3%), it exceeds Spain’s (69.3%).
Public debt is a proxy measure of how much the economic system, and particularly social spending, is dysfunctional and unsustainable. The correlation of high unemployment rates and low GDP growth is noticeable. The EU up to 2010 was spending nearly half of GDP on government expenditures while the U.S. is at 40% (double what it was in 1950) and trending upwards.
The disastrous effects are clear. The entire Euro area’s unemployment rate is 11%. The United States’ unemployment is officially 8.1%; but as Zero Hedge reports U3 unemployment is 11.6%, and labor force participation is abysmal.
Below is a list of unemployment and GDP (Gross Domestic Product) growth figures for select European nations. Bear in mind that one of the stated goals of the openly socialist parties in Europe, which have come to power recently in Greece, Spain, France and other European nations, is to achieve full employment.
- Portugal’s unemployment rate is 15.2% and its GDP growth is 1.4%.
- Ireland’s unemployment rate is 14.2% and its GDP growth is -0.4%.
- Greece’s unemployment rate is 21.9% (March 2012) and its GDP growth is -3.5%.
- Spain’s unemployment rate is 24.3% and its GDP growth is -0.1%.
- France’s unemployment rate is 10.2% and its GDP growth is 1.5%.
The welfare state’s not so sexy is it?