When Federal Reserve Chairman Ben Bernanke ventured to the Senate last Thursday for a closed-door gathering, he found a nervous Democratic caucus. One senator put their anxiety into words: How worried should we be about Europe?
The question wasn't merely about the drag on U.S. gross domestic product that a downturn on the continent could have. More importantly, Democrats were worried about the anti-incumbent anger in the European electorate, said one senator who was in the meeting.
Bernanke demurred, declining to get into the politics, but other senators in the room answered the question: Voters, they warned, will punish incumbents for the pain of austerity.
"Incumbency plus austerity equals political death," MP Jon Trickett, a top official with Ed Miliband's Labour Party, told HuffPost. "There is a general spirit across Europe, and perhaps in the U.S., against the political elite."The weekend after the meeting, that equation played out as predicted, smashing Chancellor Angela Merkel's ruling party in a state election described as a devastating setback by German media.
One of the most powerful messages that U.S. politicians have delivered to voters over the past few years is the warning that the nation will "become Greece" if it doesn't lower its debt and deficit. But now voters in Greece and across Europe are sending back a warning of their own.
American elites are fond of describing the nation they represent as exceptional. But the language of reelection is universal -- and bipartisan.
"Off with their heads," said Sen. Pat Roberts (R-Kan.) when asked about the message European voters were sending.
Read the rest at The Huffington Post
Ned Simons reported from London, Alexandre Phalippou from Paris, and Ryan Grim from Washington
8 comments:
Not that I expect it to happen, but if Obama has any intention of leading his party to victory, he needs to reverse course pronto before his opportunistic opponent gets the jump on him and does it first.
Obama needs to explain to the country that debt-focused, austerity-courting Grand Bargain strategy was a bad idea, and that his administration is changing course. He should argue that the European meltdown is the outcome of a live experiment on the viability of austerity and budget conservatism. The results of that experiment are now in, and the US must do everything it can to avoid repeating the European tragedy here. No more fear and debt-hysteria. It is time to spend and invest. We are not "out of money".
He should argue that our country, and the larger Western world, is stagnating economically because we are paralyzed by malevolent politics and strategic economic incompetence, and that we need to reverse course and begin to invest publicly in our future in a fairly massive way.
He should explain that there is no parsimonious, penny-pinching path to dynamic national growth, systemic change and full employment, and that the first rule of growth is that you need to spend money to make money. He should apologize for failing to call earlier for the political will to take this more ambitious path, and for being intimidated by a demagogic and incompetent Congress.
He should explain that the "crowding out" theory is bunk, and that US growth has historically been pushed forward by major national spending commitments that only government can organize. He might recall that the US was in even worse shape in the 30's than we are now, and that five years of government-directed wartime investment on an expensive global commitment pushed us out of stagnation and laid the foundation for a postwar golden age of unprecedented prosperity.
He can argue that we don't need a war, but the economic and moral equivalent of one, and that we need to mobilize our nation and the global community to save our future and our planet, and to put all of our people to work.
He should show Pete Peterson's hacks the door, and kick himself for listening to those small minded and predatory losers.
Dan you should be his speechwriter...
Resp,
Hey Matt,
I hereby give them permission to steal any of the words they want!
Yes, Dan, he should do that. Do you think he will, really? He has never shown any affection for the "left". He is center right with a strong bi partisan bent. He is the one who appointed the deficit reduction committee when there was no need to do it. We will see. He just may be happier to go down in flames than reverse course. Even Pelosi support austerity.
Jonf,
I don't think Obama likes the left, but he does like political survival. If Europe continues to unravel, we have a whole new political ballgame.
Yes, the unraveling of the euro could change the game here. Let's just hope it is for the good.
He will NEVER do it. He BELIEVES deficit reduction is the only way of avoiding becoming the next Europe. This is a deeply held political belief in this country and Obama, along with his entire advisory team, believes it.
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