The United States and the Tea Party Adventure
Published in Alternatives Economiques
(France) on 5 November 2010
by Guillaume Duval (link to
original)
After the economic crisis of 1929, the Americans had the wisdom to choose Franklin Roosevelt’s New Deal. It is very worrying then that they chose the libertarian tea party in the 2010 midterm elections, even though the current economic crisis has been caused by liberal ideas.
Americans have overwhelmingly rejected Barack Obama, giving a large majority of the seats in the House of Representatives to the Republicans, with a number of them belonging to the extremist tea party. Truthfully speaking, these results are not surprising. Overseas unemployment has been around 10 percent for the last three years now. However, 10 percent unemployment in America is very different from 10 percent unemployment in Europe. In America, unemployment benefits only last for a few months. They don’t have non-contributory unemployment benefits, general public health insurance or universal healthcare.* In France, life is not easy for the unemployed, but it is not nearly as difficult as it is for those in the same situation in the United States. The situation in the U.S. is even worse when you consider that this high unemployment is combined with high levels of household debt. The problems we face here are not comparable to those in America, but it is still very worrying.
Barack Obama has certainly made mistakes. He has had too much proximity to Wall Street, and he has underestimated the priorities involved with the issue of unemployment. Nevertheless, being the American president is a thankless job at the moment. The “American Model,” so regularly praised, has effectively come to the end of its path. It has generated growing imbalances — internally in the case of household debt and externally in the foreign trade deficit that it has accumulated. Americans need to learn to consume less and save more, but it’s going to be a socially and politically painful process.
It is fascinating to see the libertarian tea party benefit from Barack Obama’s difficulties, even though it is the liberal ideas implemented in the U.S. commerce almost continually since Ronal Reagan’s arrival in the 1980s that has put them in their current situation. It’s never a good thing when history repeats itself, but it’s well-documented that the wrong choices were made after major crises that only exacerbated the problems. Following the economic crisis of 1929, European countries introduced the same policies that the tea party is so fond of, such as less government intervention and the drastic and rapid reduction of public deficits. It is ideas such as this that led to the election of Adolf Hitler as leader of Germany, with the aftermath being the second civil war in Europe in the space of 25 years. We all know what the consequences of those events were.
At that time, Americans had taken the first steps in adopting similar policies to the European countries. However, they had the wisdom to elect Franklin Delano Roosevelt in 1932. He was the one who implemented the Keynesian policies of the New Deal, which spared the country from social unrest and political changes despite the magnitude of the depression it had endured. If they choose this time to engage in any further adventures with the tea party, we may find that the main risk for slipping after this crisis comes from the United States. However, Europe does not lack this possibility either; our apprentice sorcerers are just as dangerous.
*Translator’s note: These are three French programs to which the author is referring:
RMI: Revenu minimum d’insertion. A form of social welfare for people of working age who do not qualify for contributory-based unemployment benefits.
Assurance maladie généralisée: A form of health insurance, which 89 percent of French people have. It allows people to be reimbursed for up to 75 percent of their health care needs.
CMU: Universal Healthcare Coverage. This is a social welfare program that allows people to be reimbursed by the government for their health care needs. Those on low incomes can take advantage of 100 percent free coverage.
Americans have overwhelmingly rejected Barack Obama, giving a large majority of the seats in the House of Representatives to the Republicans, with a number of them belonging to the extremist tea party. Truthfully speaking, these results are not surprising. Overseas unemployment has been around 10 percent for the last three years now. However, 10 percent unemployment in America is very different from 10 percent unemployment in Europe. In America, unemployment benefits only last for a few months. They don’t have non-contributory unemployment benefits, general public health insurance or universal healthcare.* In France, life is not easy for the unemployed, but it is not nearly as difficult as it is for those in the same situation in the United States. The situation in the U.S. is even worse when you consider that this high unemployment is combined with high levels of household debt. The problems we face here are not comparable to those in America, but it is still very worrying.
Barack Obama has certainly made mistakes. He has had too much proximity to Wall Street, and he has underestimated the priorities involved with the issue of unemployment. Nevertheless, being the American president is a thankless job at the moment. The “American Model,” so regularly praised, has effectively come to the end of its path. It has generated growing imbalances — internally in the case of household debt and externally in the foreign trade deficit that it has accumulated. Americans need to learn to consume less and save more, but it’s going to be a socially and politically painful process.
It is fascinating to see the libertarian tea party benefit from Barack Obama’s difficulties, even though it is the liberal ideas implemented in the U.S. commerce almost continually since Ronal Reagan’s arrival in the 1980s that has put them in their current situation. It’s never a good thing when history repeats itself, but it’s well-documented that the wrong choices were made after major crises that only exacerbated the problems. Following the economic crisis of 1929, European countries introduced the same policies that the tea party is so fond of, such as less government intervention and the drastic and rapid reduction of public deficits. It is ideas such as this that led to the election of Adolf Hitler as leader of Germany, with the aftermath being the second civil war in Europe in the space of 25 years. We all know what the consequences of those events were.
At that time, Americans had taken the first steps in adopting similar policies to the European countries. However, they had the wisdom to elect Franklin Delano Roosevelt in 1932. He was the one who implemented the Keynesian policies of the New Deal, which spared the country from social unrest and political changes despite the magnitude of the depression it had endured. If they choose this time to engage in any further adventures with the tea party, we may find that the main risk for slipping after this crisis comes from the United States. However, Europe does not lack this possibility either; our apprentice sorcerers are just as dangerous.
*Translator’s note: These are three French programs to which the author is referring:
RMI: Revenu minimum d’insertion. A form of social welfare for people of working age who do not qualify for contributory-based unemployment benefits.
Assurance maladie généralisée: A form of health insurance, which 89 percent of French people have. It allows people to be reimbursed for up to 75 percent of their health care needs.
CMU: Universal Healthcare Coverage. This is a social welfare program that allows people to be reimbursed by the government for their health care needs. Those on low incomes can take advantage of 100 percent free coverage.