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Jan. 25, 2012, 12:01 a.m. EST
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By Jason O'Mahony
DUBLIN (MarketWatch) "” The late great comedian Bill Hicks had a bit where he would talk about the constant stream of murder, death and destruction that would appear on the nightly news. He would then look out his window at the silent streets below and wonder where all this mayhem was actually happening.
Europeans watching the Republican Party primaries (yes, we actually do!) are being left with a similar impression, with GOP candidates hurling that filthy expletive "European" "” which they load with the lack of moral fiber of a Janet Jackson wardrobe malfunction "” at each other.
Unlike U.S. politicians, who talk and talk about making tough decisions, European politicians are actually making them. Just ask the riot police
The Europe that is spoken of seems to be a dentist-free socialist hellhole where decent coffee and hot showers are a novelty, and where compulsory state-backed homosexuality is forced upon God-fearin' Christians. It leaves Europeans looking out our windows wondering whether there's another Europe we haven't heard of.
It's not just a cultural thing, either. Watching American conservatives talk about what is needed for America, Europeans keep looking to their checklists and saying, "But we actually do that!"
Cuts in public spending? Yup. Cuts in entitlement programs? Yup. Balanced-budget amendments? Yup. Indeed, unlike U.S. politicians, who talk and talk about making tough decisions, European politicians are actually making them. Just ask the riot police.
True, Europeans go further by actually raising taxes (as that well-known Red, Ronald Reagan, did in his first term) but the reality is that Europeans are, for the most part (I'm looking at you, Athens), engaged in almost Victorian approaches to getting taxation and spending into sync.
And, unlike the U.S., "socialist Europe" didn't pump vast sums of money into the economy through quantitative easing because it had a European Central Bank president, Jean-Claude Trichet, who made Ron Paul sound like Michael Moore. Trichet was recently replaced by Italy's Mario Draghi, but the comparison still stands.
Is it possible that the ECB will eventually go the Bernanke route? Quite possibly, especially if it dawns on French President Sarkozy (who faces the polls in April) that France's recent ratings-agency finger wagging might have something to do with fears about Europe's lack of growth.
But even that will only be after more austere cuts to public spending by euro-zone governments backed by a padlock-on-the-cookie-jar fiscal compact binding nearly every EU state. You know, the sort of thing Newt Gingrich used to advocate before he became Comrade Newt, scourge of the corporate raider. When he wasn't otherwise occupied, of course.
The curious thing is that the GOP seems to have a blind spot when it comes to European capitalism. Airbus, Dassault /quotes/zigman/163767 DASTY -0.30% , British Aerospace, Mercedes Benz /quotes/zigman/231580 DE:DAI -0.70% , Volkswagen /quotes/zigman/150347 DE:VOW -0.03% , Hugo Boss /quotes/zigman/144088 DE:BOS +1.67% , Chanel, Fiat /quotes/zigman/213459 IT:F +1.73% , Tesco /quotes/zigman/156634 UK:TSCO -1.49% , Carrefour /quotes/zigman/163594 FR:CA -0.76% , Lego and BMW /quotes/zigman/143329 DE:BMW -0.84% "” Mitt Romney has heard of them, right? All well-known global brands, all companies operating quite comfortably in Europe, and not run by commissars either, with many run by people who can ( le shock! ) speak French, too.
That's not to say that Europe does not have its share of anti-free-market fanatics. You can't so much as say "profit" in France without picturing a moustache-twirling plutocrat tying a comely female comrade to a train track. But France also has very successful businesspeople.
The difference is that there is a much greater free market of open political choice in Europe than in the U.S., from the fascist right to the Trotskyist left. If anything, it always surprises Europeans that a country that boasts hundreds of choices in breakfast cereal can only seem to tolerate two political parties.
Not only that, but Europeans scratch their heads at the American terror not just of socialist ideas but of that even worse monster, foreign ideas. Europeans, on the other hand, seem much more open to ideas from the United States. Only last week, a well-known Irish millionaire (and solid pro-American), Declan Ganley, known as a critic of European integration, used the U.S. as an example of why Europe should merge into a United States of Europe. European federalists openly use the U.S. Congress and separation of powers as a model for the direction a federal Europe should be heading in.
Having said all that, there is one area where the U.S. is absolutely right, and that is the importance of creating growth to reduce unemployment. It is nothing short of a continent-sized source of shame the way European leaders are not only willing to tolerate levels of unemployment "” topping out at 21% in Spain "” that would be political Kryptonite in the U.S., but also regard those levels as being a lesser political risk than attempting the labor-law and public-sector reforms needed to address the situation. It is surreal the way even left-wing EU leaders seem to be more comfortable debating yet more austerity than taking radical steps to create growth and reduce unemployment.
Only this week, for example, French and German leaders have returned to the sore tooth they just can't stop poking: Ireland's 12.5% corporate tax rate. Once again they are suggesting an EU-wide (and presumably higher) tax rate. Is there anyone who really believes that Ireland's raising its corporate tax rate, perhaps even to U.S. levels, will lower its 14% unemployment rate?
Perhaps it is the generous European social-welfare net that allows them to tolerate it, but it does create a curious paradox. Whereas European leaders regard the welfare state in the same way many U.S. politicians regard their religious faith, it allows those same EU leaders to dismiss the travails of the unemployed in a way that U.S. politicians just could not. The great transatlantic irony is that when it comes to the issue of creating jobs for the unemployed, those perceived in Europe as hard-hearted American conservatives are actually more concerned than their left-wing European counterparts.
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