American liberals have long dreamed of a U.S. that is more like Europe.  Not necessarily culturally, but economically and politically.  Large and generous welfare programs, strict labor laws, and well-funded public services.  President Obama promised to deliver it for them.  He succeeded in some areas but failed in most.  After three years, Americans are rejecting to the European model.  Not only have Obama’s new policies failed, his exemplars in Europe are failing as well.

Most European countries have adopted some form of “social democracy.”  In this system the central government provides nearly all public services, like health care and education.  There are worker-friendly labor laws such as short work weeks, early retirement (at age 50 in Greece), and strict requirements for firing an employee.  An employer can’t just fire an employee in most European countries.  He needs cause, which is well-supported with evidence.

The government plays a prominent role in the economy with several state corporations, a large number of state employees, and financial interventions to help save failing industries.  It is not full-fledged socialism but it is much closer to it than the American economic system.

The European Model is exactly what President Obama and liberal democrats wanted to implement in America.  They wanted the federal government (central government) to play a dominant role in health care, education, housing, income security, and a direct role in helping large American corporations.  Although there are no official state corporations, President Obama misused TARP funds to buy stakes in banks, financial companies, auto-makers, and other business entities.

As most economists and conservatives predicted, his plan has failed.  Government services are no better today than they were four years ago.  The cost of public goods is still increasing and economic growth has slowed to a crawl.  Meanwhile the federal deficit has exploded and the national debt now exceeds GDP.

This is exactly what is happening in Europe.

Countries that have followed the model for longer are going bankrupt.  Many have been forced to raise taxes and cut spending which has reduced funding for those generous public services.  Economic growth is almost zero.  The financial crisis threatens the unity of the European Union and the stability of the Euro, the top currency competitor to the U.S. dollar.  In fact the fall of the Euro may be the only reason the U.S. dollar has not collapsed.  The dollar is the best of the worst.

Europe has also failed to provide Obama with a model on how to get out of this mess.  With the exception of Germany, nearly every Euro member has been forced to reverse many of its social democratic policies.  Portugal, Ireland, Greece, Spain, and Italy have all been forced to cut government spending dramatically, lay off workers, increase retirement ages, and raise taxes.  In Greece this has led to violent riots.  The Germany, an economic powerhouse and slightly more conservative spender, has been able to avoid the worst of it, but its currency alliance with the more irresponsible European states exposes it to the contagion.  France has provided no answers either.

Eventually you run out of other people’s money.  Europe has finally ran out.  High tax/high debt policies have failed.  Europe is now taking measures conservatives have been screaming about for years.

What about America?

President Obama and Democrats in Congress absolutely refuse to implement any changes in policy.  They seem to think we won’t follow the path of Europe.  Despite the overwhelming evidence and warnings from economists, they believe the U.S. government is somehow above it.  In battles with Republicans, they refuse to cut spending any more than 1-2 percent.  Instead they want to raise taxes and add $9 trillion more to the debt.

In other words, while Europe is trying to fix the problem, American liberals prefer to pretend there is no problem.

The European Model is failing.  Americans know it.  Conservatives and tea partiers knew it years ago.  When President Bush and a Republican Congress were deficit spending and expanding the federal government, conservatives warned them but were ignored.  Republicans decided to rally around their President rather than hold to principle.  Now we have a President who lacks such principles.  He is prepared to follow the Euro model to oblivion then blame others for its failure.  It is time for a new model.  It is time for Republicans to offer that new model and make the case to the American people that it is the right one.

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