DawgTalkers.net Forums DawgTalk Tailgate Forum We must not copy the European model of gov't spending.

Yes, we all know how crazy the Prez. and Congress have been spending like drunken sailors but Walter Williams teaches us an interesting lesson.

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Wednesday, November 22, 2006

Should we really copy Europe?

-Posted: November 22, 2006
1:00 a.m. Eastern
By Walter Williams

? 2006
Some Americans look to European countries such as France, Germany and its Scandinavian neighbors and suggest that we adopt some of their economic policies. I agree ? we should look at Europe for the lessons they can teach us. Dr. Daniel Mitchell, research fellow at the Heritage Foundation, does just that in his paper titled "Fiscal Policy Lessons from Europe."

Government spending exceeds 50 percent of the GDP in France and Sweden and more than 45 percent in Germany and Italy, compared to U.S. federal, state and local spending of just under 36 percent. Government spending encourages people to rely on handouts rather than individual initiative, and the higher taxes to finance the handouts reduce incentives to work, save and invest. The European results shouldn't surprise anyone. U.S. per capita output in 2003 was $39,700, almost 40 percent higher than the average of $28,700 for European nations.
Over the last decade, the U.S. economy has grown twice as fast as European economies. In 2006, European unemployment averaged 8 percent, while the U.S. average was 4.7 percent. What's more, the percentage of Americans without a job for more than 12 months was 12.7 percent, while in Europe it was 42.6 percent. Since 1970, 57 million new jobs were created in the U.S., and just 4 million were created in Europe.

Dr. Mitchell cites a comparative study by Timbro, a Swedish think tank, showing that European countries rank with the poorest U.S. states in terms of living standards, roughly equal to Arkansas and Montana and only slightly ahead of West Virginia and Mississippi. Average living space in Europe is just under 1,000 square feet for the average household, while U.S. households enjoy an average of 1,875 square feet, and poor households 1,200 square feet. In terms of income levels, productivity, employment levels and R&D investment, according to Eurochambres (The Association of European Chambers of Commerce and Industry), it would take Europe about two decades to catch up with us, assuming we didn't grow further.

We don't have to rely on these statistics to make us not want to be like Europeans; just watch where the foot traffic and money flow. Some 400,000 European science and technology graduates live in the U.S. European migration to our country rose by 16 percent during the 1990s. In 1980, the Bureau of Economic Analysis put foreign direct investment in the U.S. at $127 billion. Today, it's more than $1.7 trillion. In 1980, there was $90 billion of foreign portfolio investment ? government and private securities ? in the U.S. Today, there's more than $4.6 trillion, much of it coming from Europeans who find our investment climate more attractive.

What's the European response to its self-made economic malaise? They don't repeal the laws that make for a poor investment climate. Instead, through the Paris-based Organisation for Economic Co-operation and Development, or OECD, they attack low-tax jurisdictions. Why? To support its welfare state, European nations must have high taxes, but if Europeans, as private citizens and businessmen, relocate, invest and save in other jurisdictions, it means less money is available to be taxed.

Dr. Mitchell addresses this issue through his research at the Center for Freedom and Prosperity. The OECD has a blacklist for countries they've identified as "tax havens." The blacklisted countries include Hong Kong, Macao, Malaysia (Labuan) and Singapore. Also targeted are Andorra, Brunei, Costa Rica, Dubai, Guatemala, Liberia, Liechtenstein, the Marshall Islands, Monaco, the Philippines and Uruguay. The blacklisted jurisdictions have strong financial privacy laws and low or zero rates of tax.

The OECD member countries want the so-called tax havens to change their laws to help them identify the earnings of their citizens. Most of all, OECD wants these countries to legislate higher taxes so as to reduce their appeal. A suggestion that we should be more like Europe is the same as one suggesting that we should be poorer.

The 70% tax is far too high for me too!

I checked out your source. A very non-bias site?

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People who promote big business and fear national health care always slam Europe. They fear import taxes and national health care. They fear import taxes to help maintain American jobs. Because it will hurt big business. This is a very slanted article with little to no credability.

Besides,add the cost of your own health care and co-pays and see how much difference it makes? Not to mention their advanced public transportation with public access to travel quickly and affordibly around their countries. They pay more,but get much more as well. When you do the math and add in the transportation and free health care,they get a lot more bang for their buck than we do.

I call BS. What's wrong with promoting big business and fearing national health care? Big businesses hire lots of people and spend lots of money, supporting smaller businesses. Is it so wrong to have them around? And national health care, I will claim a bit of ignorance, as I haven't studied how it works, but government is inherently inefficient, I assume we'd be spending more overall to support government employees and more bureaucracy. Also, we'd be cutting off Adam Smith's invisible hand. Any way I can imagine a national health care system working would be less efficient. I'll agree with the get more for paying more, but as far as more bang for your buck, I'm going to disagree.

In case you've been under a rock,most of the jobs they're creating and MOVING are overseas. NOT here. Everybody from auto makers to textiles to steel. That's why import taxes/tarrifs are needed to stop the bleeding of our jobs moving out of the U'S..


Okay,then why are drugs made in America,cheaper in Canada? because the Canadian government negotiates prices in bulk from the drug makers. Look at the inflation rate verses the rise in health care in this country. It's an industry run ammuck bl;eeding our citizens. Either place stingent restrictions on the health care industry to stop raping our citizens,or make health care national. One or the other.

All you have to do is look at where the top 500 manufacturing are creating jobs. It's sure as hell not in the U.S. And those that do,hire all thew cheap,"illegal" work force they can so American wages are going nowhere. While the entire time,the medical industry is laughing all the way to the bank.

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OK, I somehow missed the import part, and just assumed higher tax rates. I'll support import tariffs to a degree, especially retaliatory tariffs. But to some degree, if we can get cheaper steel or labor from elsewhere, that would allow us to spend our money and time more efficiently in other areas such as technology. I kind of agree with you here, I'm just saying we shouldn't blindly protect all our jobs at all costs.



I'll agree with the problems you see in the industry. We are a leader though, in the advancement of medical technology, and the cost of research and development in this industry is likely quite high. National health care isn't the answer though, maybe your other idea of more stringent restrictions would work, or maybe we need less restrictions. If other countries can get drugs cheaper then we can without their government paying a part of the cost, then we should be able to buy from the same sources at nearly the same prices. This could hurt the quality of our drugs a bit, but if a small decline in quality means a large decline in prices, it could be worth it

I've never heard the guy who owned the burger joint on the conrer say 'Thank God for McDonald's'. I've never heard the local mom and pop grocer say 'I'm glad Super Wal-Mart is here!. I've never heard the record store clerk say 'I've gotten so much help from Virgin.' And I've rarely see big business spend money on anything but bigger business.

"I checked out your source. A very non-bias site?"

I realize that many professors on college campuses these days are whack jobs,but Professor Walter Williams has been a full Professor of Economics at George Mason Univ. for a number of years and is highly respected by most fair minded thinkers.

I slam big business when it is deserved after all big business is BIG BUSINESS because it generally operates properly in the American business climate and serves shareholders as well as employees and consumers. For every one Enron you may find 10 other major players who do not violate our trust.

Many of us do slam Europe...many of us slam what is left of Europe since they decided to slide down the foolish path of Socialism and government control of many major industries. I am sure you are aware that even Canada [which I do realize is not part of the EU] has decided that their National Health Care System is going broke and must be refigured. The Swedes and Norwegians are in dire economic straits with their Big Brother Health Care and Nanny State...add to this the impending chaos delivered by the flood of Muslim immigrants and don't go long on many Scandinavian stocks!

Listen Pit...I realize that the dice have been cast and some version of expanded National health care is going to happen. This is inevitable.

Social Security has lasted more than 60 years and will be around for another 20 or so...National Health Care will be another tear in fabric of our free economic system. The Redistribution of Wealth in America is continuing with all these social schemes that drain us of our will to provide for ourselves and family members...at an Extreme Cost in Money and Personal Pride/Responsibility.

As a comedian said several years ago " if you think Health Care is EXPENSIVE now, wait til you see how Much it costs when it is FREE!!!"

I just went through major surgery WITH "health care" as they call it. There's simply no excuse for some of these outlandish charges and fees. There's a difference in free enterprise and medical extortion.

Basicly,you often have times you MUST recieve health care. And they use it more like ransom than a cost. Like I said,look at the cost rise in health care over the past ten years compared to inflation. There's simply no excuse for it.

If they acted above board with their costs,this wouldn't be an issue,but they're not. Both health care costs and health care insurance. My premiums have went up every year now for five years while my co-pays have went up also.

It's completly out of hand.

I can't claim to know anything about Norway, but as far as Sweden...in dire straits? I'm not really sure what you're talking about. Actually, economically, the last two years have been pretty good for them.

GDP:



Here's the breakdown of change:



Here's a breakdown of the health status in Sweden:

"By international standards, health in Sweden is relatively good. Infant mortality is low, at 3.4 deaths per 1,000 in the first year of life. Cardiovascular conditions account for half of all deaths. However, deaths attributable to these diseases fell substantially during the 1980s, which has contributed to a higher average life expectancy of 77.1 years for men and 81.9 years for women. Deaths from injuries, alcohol-related diseases and suicide have also been on the decline for many years. The proportion of the population with allergic conditions doubled during the 1980s, with more than one third of people living in Sweden saying that they suffer from some form of allergy or over-sensitivity. Another public health problem is the growing proportion of overweight children, young and middle-aged people. Mental health and psychosomatic problems are on the increase among children and young people."

Sound familiar? <img src="/images/graemlins/rofl.gif" alt="" />

Pit, as far as European public transit, and "travelling quickly and affordably through their country...", just look at the European countries land size and population density, then compare it to the u.s. In doing so, you may see why the u.s. does not have public transit going to all corners of the country, or even a state. We have public transit in our metropolitan areas, where it is feasible. To insinuate that mass public transit for our country is doable is to ignore some basic facts on the population density and simple size of our country.

As for national health care? You don't seriously want the gov't. deciding who gets what care, and when they get it, do you? I see your point about Canada and the prescriptions - that is valid, in my opinion. I would be in favor of something along those lines.

But national health care? Talk to someone from Canada that needs an MRI to find the problem. Or talk to someone from most European countries that needs "specialized" care. Ask them about the months on a waiting list. Ask them what happens when they have to miss an appointment due to a funeral. Ask them about the worries they have when the hospital they are to have tests done at tells them "you are scheduled at 12:30 pm, on the 26th of the month - 8 months from now."

You just had a major surgery. You are recuperating. Imagine yourself in the position of many that come from a "nationlized medicine" country. You wait your turn. Could be 2 months, could be 2 years. You want that? And you want everyone to ante up taxes to pay for it?

You know as well as I do that when gov't. gets involved, costs go up, and efficiency goes down. That is not what health care needs.

If it were simple and easy, it would've been done. However, if gov't. gets involved with health care, you will see costs increase, care decrease, and technology diminish.

I agree, health care is too expensive. Some of that is due to the new technology that comes about weekly, it seems. Some is due to people expecting to be able to take a pill for whatever ails them. And some is due to lawsuits that now require doctors, hospitals, etc, to run more tests, and more, and more, and, God forbid they can't cure you, they get sued.

Got a hangnail? We'll fix it, but first we need to test for infection, then for rabies, then for prostrate cancer, then we have to do an mri to find out if you have other problems, then we need to clear it with the "clearing it" lawyers, then you need to come in and have a brain scan done, then we can do it. Oh, by the way, what was it you came in for? See, we're just protecting our asses, so you don't get your problem taken care of then sue us for another problem.

On a side note, I've been hearing ads for a sleep aid recently. The ad says how great it is, blah blah, blah......then it says the side effects include drowsiness, fatigue, and lack of concentration...... duh!!!! Know why they have to say that? Cause if they don't, they will end up being sued. Someone will take the pill, fall asleep sometime when they shouldn't, then turn around and sue the doctor, hospital, and drug company for millions, and win. All the while, the fact that they took a sleep aid pill will escape everyone.......

Well arch,there's only two choices,strongly regulate the business or have national health care.

I prefer regulation over national health care,but you can't let the cost of health care keep spiraling out of control the way it has been.

Think about it. We both already know from a previous post all of the different taxes we pay now. ie...when you make it,when you spend it and any time you earn a dollar from investments,beer,etc........

But look at insurance?
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I think if you ever sat down and figured your taxes,combined with insurance costs,you'd see just how much of your money gets eaten up between insurance and taxes. It's astronomical.

And I know exactly what you mean about tests. I'm a stubborn old bastid (news flash)
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......and worked up untill I simply couldn't stand up anymore before seeing a doctor about my back. I was disabled in February. But they had to do so many MRI's,a spinal tap,blood work three times and I can't remember what all else before they would do surgery.

So I didn't actuallyhave the surgery untill mid June! And after paying health insurance premiums for almost thirty years rarely ever using it,you ought to see the bills! Hell,I might as well not have had insurance at all!

But I start my physical therapy right after the holidays. Six weeks of that,I should be good to go again!

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