European Elections and the Debt Debacle

That;s the title of my latest piece in The National Interest. Here’s the three-para teaser

European Elections and the Debt Debacle

The victory of socialist François Hollande in the French presidential election has been interpreted, correctly, as a repudiation of the austerity policies imposed on the euro zone by his predecessor, Nicolas Sarkozy, in collaboration with German chancellor Angela Merkel, who endorsed Sarkozy in the election.

Hollande’s win was part of a backlash across Europe, with pro-austerity parties from Britain to Greece taking electoral drubbings. Even in Germany, Merkel’s coalition parties were crushed in a state election in Schleswig-Holstein.

It’s safe to predict that Hollande and Merkel will soon come into conflict over austerity. But Hollande’s real opponents in the struggle over European economic policy are not Merkel and the German government but the European Central Bank and its chairman Mario Draghi.

61 thoughts on “European Elections and the Debt Debacle

  1. Incidentally, a libertarian friend of mine described me as a ‘conservative’ recently in that I am a reformist social democrat living in basically a reformist social democracy.

    He’s probably not wrong, but his insight falls into the category: ‘useless but true’.

  2. @Dan
    So you do not know what a communist is? A democratic socialist? A green? A liberal in the Australian, British, American and classical senses? A democrat? A republican? Liberal democrat in the USA and the UK? A Libertarian?

    What political label listed above is meant as a sustained sneer?

    Which of the above requires you to read a wiki to puzzle out what it means?

  3. @Dan

    I had a look at the neoliberalism wiki. the links to the Austrian school are bizarre

    the austrian school has no policy influence per se. Austrian economists with university jobs could not form a cricket team prior to 1990 and even 2000. They can still all meet in one room.

    Milton Friedman declared himself “an enormous admirer of Hayek, but not for his economics”. This may may have been one reason why Hayek could not get a job at the university of chicago’s department of economics.

    As for this supposed lead neoliberal conspirator and intellectual mentor, my googling for obituaries for Hayek was very unrewarding and got short obits like this at which notes that “he was all but ignored by other economists for 30 years after World War II, although he was respected for early contributions to monetary theory”.

    Hayek’s son got a longer obituary in the London Independent because of his father’s comeback over the last 10 years.

  4. @Jim Rose

    Although I doubt you intended it to be, it’s a fascinating question.

    The Hawke/Keating market reforms were neoliberal in their orientation, ditto Clinton’s economic policy, but were their administrations neoliberal? Were/are they neoliberal? I don’t think so. What I do think is that at a particular point in economic history the current was moving a particular way and that’s a hard thing to resist.

    But of course the current doesn’t come out of a vacuum.

  5. dan, you invite the question of whether there are neoliberal administrations that did not adopt neoliberal policies? sarko and many a rightwing government in the EU?

    the secret of winning the median vote is have policies slighlty different from your opponent.

    But recall Why Only Nixon Could Go to China by Tyler Cowen and Daniel Sutter in Public Choice

    Right-wing politicians sometimes can implement policies that left-wing politicians cannot, and vice versa. Contemporary wisdom has it that ‘only Nixon could have gone to China.’

    the authors say that a policy issue could depend on information, on which every one could potentially agree on policy, or on values, on which agreement is impossible.

    Politicians, who value both reelection and policy outcomes, realize the nature of the issue, whereas voters do not.

    Only a right-wing president can credibly signal the desirability of a left-wing course of action. The Nixon paradox can hold then if citizens vote retrospectively on the issue.

    Left-wing parties adopt right-wing policies because they are good ideas that will get them re-elected. hawke and clinton were firmly camped over the middle-ground.

  6. @ Chris Warren, thank you for expressing your appreciation.

    You may also find of interest the following comment posted by the same author:

    French Gov leads by example, unlike Australia and U.S.

    In contrast to the increasingly ‘Do as I say, not what I do’ style of Anglophone governments, the new French government intends to lead by example:

    For example, Ministerial salaries have been reduced by 30 %, including the President’s. This brings French salaries below German ones but above Spanish ones.

    Of the 34 members of the French government, 17 are women.

    Source: Journal Televise, France2, 17 May 2012.(ends)

  7. But who got the senior posts out of the 34. many female ministers are becoming common outside of the british isles in the EU. there are even female heads of government.

  8. @Jim Rose

    I can’t say. Sheila Newman says she will find the answer to your question, when she has a moment.

    (I also posted your query on our site. Feel welcome to post comments there as well as here.)

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