The American Cul-de-Sac

The American election is taking place against the backdrop of an unprecedented social, political and economic crisis.

Growth and employment are stagnating, 15 percent of the population is living below the poverty line, the government and the consumers are heavily indebted, the middle class is becoming poorer, the health and education systems are expensive and inefficient, revenue inequality is reaching unprecedented levels since the New Deal and the largest prison population on the planet (more than two million) is cutting into state budgets.

In addition to increasingly unbridled international competition, the United States must also face Europe’s structural decline, the slowing down of a large number of emerging countries and the elevated price of oil due to blunders in the Middle East.

The American political system is not able to meet these challenges. Systematic obstruction and the Democrats’ and Republicans’ refusal to collaborate, in addition to a tough institutional and constitutional dynamic, are inevitably causing opposition to change. The predominant influence of electoral financing and lobbying — unique in the Western world — undermines the functioning of American democracy.

The deepening polarization and partisanship which are manifested in the campaign are not simply electoral, but also social and political. Two diametrically opposed visions are clashing.

Yet, neither Mitt Romney’s program of growth by austerity nor Barack Obama’s mainly short-term investments will produce long-lasting solutions for the challenges faced by American society.

On the one hand, Mr. Obama is defending the role of the state in the reduction of inequalities, the protection of the most impoverished and access to universal health care. The concept of fairness is central to his electoral message. He also advocates an increase in taxes for the rich and cuts to the defense budget.

Nevertheless, during his speech at the Democratic National Convention, Mr. Obama finally recognized that the structural socio-economic problems which the United States is facing cannot be fixed short-term, and that he had to stop the decline of the education system, relaunch R&D and innovation and modernize infrastructures. Mr. Obama may not have much leeway, however, in particular because of December 2012’s “fiscal cliff,” and the Republicans’ refusal to support any raise in taxes.

As for Mr. Romney, he is prescribing quick and simple solutions. He is convinced that big government — in particular the regulatory constraints, high taxes and a climate of uncertainty created by the Obama government — is preventing the private sector from investing and is undermining economic growth. He is committed to reducing taxes and the deficit, all while increasing the defense budget in order to reintroduce an aggressive and self-destructive foreign policy. All that the Republican Party and the tea party would need to do is convince a large portion of voters that the government and the liberals are the source of all their problems.

Growth by austerity is bound to fail. The drastic and inevitable cuts to social programs will provoke a slowing of the economy, if not a recession. By creating excessive and unrealistic expectations for voters that are already impatient and angry, and by attacking the disadvantaged head-on, Mr. Romney is risking — in addition to a failure in the mid-term elections in 2014 — provoking a pullback that could escalate into a social crisis.

In the long term, the United States will benefit from considerable advantages compared to most countries on the planet: energy independence, a relative abundance of resources — in particular arable land and water, a high immigration rate, a favorable demographic, considerable financial wiggle room (the absence of a consumption tax, for example) in order fight debt.

Coming up to the presidential election, however, we are getting dangerously far away from the spirit of the New Deal and a new social policy that would assure a socioeconomic transition during the next few years, which would be difficult, but critical for the future of the United States.