Europe's Comeback, America's Retreat?

October 27, 2011 Topic: Public Opinion Region: Western Europe Blog Brand: Jacob Heilbrunn

Europe's Comeback, America's Retreat?


The continent is in crisis. Its politicians are squabbling. No solution seems to be in sight. A recession looms because of political bungling. The world economy could falter. Until a few days ago, this sounded like Europe. But now it could be the fate of America. It's starting to look as though Europe may get its economic act together before we do.

Today's Washington Post features several stories on the American budget crisis, including one titled "The budgeting breakdown." The situation in Congress is so bad that two Senators, Benhamin L. Cardin and Kelly Ayotte, are sponsoring a bill that would shutter Congress if it is unable to reach a budget agreement. The fact is that Congress is already in effect rendered almost otiose by its constant wrangling over the most picayune budget amendments. It's not entirely clear that the country would even notice if Congress were closed—or that it would even matter. Think of the fodder for cable networks; they could do plenty of pieces chronicling what legislators do in their private time. Perhaps some will even be tempted to emulate Vladimir Putin and show off their sports prowess or skilling, if you're a legislator from the West, at riding a bucking bronco.


The likelihood that the current Congress will reach a budget agreement appears slim. The automatic cuts stipulated in the budget deal between President Obama and the GOP congressional leadership may well automatically be triggered in January 2013, including trimming defense spending, much to the anguish of many Republicans. There is no longer any such thing as a budget process. There is budget inaction. As Lee Hamilton told the Post:

"It's a very serious problem: The world's greatest democracy cannot produce a budget," said Lee Hamilton, who served 34 years in Congress and now serves as director of the Center on Congress at the University of Indiana. "When people say it's dysfunctional, when they say it's not working well, the budget process, I think, is exhibit A in that charge."

Contrast this with Europe. There you have a political elite that is, more or less, unified around the idea of saving the Euro and the common market. Chancellor Angela Merkel won a resounding victory in parliement yesterday—what amounted to a super-majority. She has the support of every party, from the Greens to the Social Democrats to the Free Democrats to her own conservative Christian Democratic Union. She headed to Brussels with a mandate for leadership. The much-criticized Merkel, allegedly dragging her feet according to her detractors, has prevailed, making it clear to her fellow politicians, if not her grumbling countrymen, that Germany, which relies on exports, cannot allow the European Union to become a fading concern. Europe has made and will make tough choices to pull its finances together. Greek bond holders will have to accept big losses; Europe's bailout fund will be increased to a trillion dollars.

Is this the last step toward rescuing insolvent southern Europe? Surely not. Germans will likely have to accept that some pump priming is necessary to create not just stability but growth in Europe. This is not the 1920s redux when inflation turned a cup of coffee into a purchase requiring an entire billfold.

But Germany is adapting. Baby steps are better than no movement. America is stuck flat on its back, a crybaby wailing at the ceiling. Meanwhile, its European partners are taking action. Who will be America's Angela Merkel, tough, determined, and, most important, victorious?