Brooks and Krugman

In “The Technocratic Nightmare” Bobo explains to us that the European Union is an attempt to build an economic and legal superstructure without a linguistic, cultural, historic and civic base. No wonder it’s in crisis.  Prof. Krugman says “Failure is Good,” and that the supercommittee is supposed to reach an agreement on budget cuts by Wednesday. Barring a miracle, it will fail to do so. But, in this case, that is good news!   Here’s Bobo:

During the first half of the 1990s, I lived in Brussels and wrote about the European Union, among other subjects, for The Wall Street Journal. This was the heyday of European integration. Helmut Kohl, François Mitterrand and Jacques Delors were in power, negotiating the Maastricht Treaty and organizing the common currency.

There was a lot of excitement among the civil servants who saw themselves as the architects of a new Europe. But there were some oddities.

The European leaders would come together for a summit and issue a joint communiqué. But then if you sampled the coverage in each of the national medias, you felt as though you were reading about 12 entirely different events.

Europe was unifying legalistically and economically, but there was no common language or common conversation. At one meeting, leaders embraced “federalism,” but that word meant one thing in Britain and another thing in Germany.

Then there was the elitism. Off the record, Europe’s technocrats would say the most blatantly condescending things: History had taught them that Europe’s peoples were not to be trusted and government should be run from the top by people like themselves.

As a consequence, European integration was opaque, and consisted of a long series of complicated fudges. When the European Union leaders were compelled to seek popular approval to get the Maastricht Treaty ratified, they sponsored a forlorn rally in a Brussels park. There were E.U. flags and booths and speakers. But the crowd was bored and sparse. At one point, everyone was asked to sing the new European national anthem to the tune of “Ode to Joy.” Dead silence. No one knew the new words that had been written to go with that masterpiece.

The European Union is an attempt to build an economic and legal superstructure without a linguistic, cultural, historic and civic base. It was the final of the post-World War II efforts — the United Nations was among the first — to build governments that were transnational, passionless and safe.

Over the 17 years since I left Brussels, I’ve been impressed and surprised that they could keep the E.U. together. The desire for a unified Europe is strong, at least among the leadership class and those over 60.

But now the inherent flaws are undermining the project. The nations of Europe have been running different kinds of economies and different kinds of democracies, reflecting their diverse histories, values and cultures. If you jam diverse economic cultures into a single currency, you’re bound to get an explosion.

At this moment of crisis, it is obvious how little moral solidarity undergirds the European pseudostate. Americans in Oregon are barely aware when their tax dollars go to Americans in Arizona. We are one people with one shared destiny. West Germans were willing to pay enormous subsidies to build the former East Germany. They, too, are one people.

But that shared identity doesn’t exist between Germans and Greeks, or even between French and Germans. It was easy to be European when it didn’t cost anything. When sacrifices are necessary, the European identity dissolves away.

The mess threatens to bring down the European project and European economies. It threatens to send the world into another global recession. (At this point, Chancellor Angela Merkel has more influence over President Obama’s re-election chances than Obama himself does.)

On a superficial level, the fault lies with the current European leadership, their addiction to inadequate patches and fudges. But the real problems emerge from the technocratic mind-set, from the arrogant gray men who believe they can engineer society, oblivious to history, language, culture, values and place.

And the final curse is that while building Europe in this way was a mistake, Europeans cannot now simply reverse course. If the euro was immediately dissolved, the Deutschmark would surge, nearly every other currency would plummet and the imbalances would create a global catastrophe.

In the short term, the European Central Bank, the stable European nations and even the U.S. will have to take extremely big and painful action to stabilize the situation. But, after that, it’ll be a time for chastening. It’ll be time to discard the technocratic mind-set that created this inherently flawed architecture and build a Europe that reflects the organic realities of those diverse societies.

Thinking back on all the complacent conversations I used to have in Brussels, I was struck by a quotation I read this week in The Economist. A European central banker said he had always wondered how Europe’s leaders could have stumbled into World War I. “From the middle of a crisis,” he said recently, “you can see how easy it is to make mistakes.”

Oh, if Bobo had only stayed in Brussels…  Here’s Prof. Krugman:

It’s a bird! It’s a plane! It’s a complete turkey! It’s the supercommittee!

By next Wednesday, the so-called supercommittee, a bipartisan group of legislators, is supposed to reach an agreement on how to reduce future deficits. Barring an evil miracle — I’ll explain the evil part later — the committee will fail to meet that deadline.

If this news surprises you, you haven’t been paying attention. If it depresses you, cheer up: In this case, failure is good.

Why was the supercommittee doomed to fail? Mainly because the gulf between our two major political parties is so wide. Republicans and Democrats don’t just have different priorities; they live in different intellectual and moral universes.

In Democrat-world, up is up and down is down. Raising taxes increases revenue, and cutting spending while the economy is still depressed reduces employment. But in Republican-world, down is up. The way to increase revenue is to cut taxes on corporations and the wealthy, and slashing government spending is a job-creation strategy. Try getting a leading Republican to admit that the Bush tax cuts increased the deficit or that sharp cuts in government spending (except on the military) would hurt the economic recovery.

Moreover, the parties have sharply different views of what constitutes economic justice.

Democrats see social insurance programs, from Social Security to food stamps, as serving the moral imperative of providing basic security to our fellow citizens and helping those in need.

Republicans have a totally different view. They may soft-pedal that view in public — in last year’s elections, they even managed to pose as defenders of Medicare — but, in private, they view the welfare state as immoral, a matter of forcing citizens at gunpoint to hand their money over to other people. By creating Social Security, declared Rick Perry in his book “Fed Up!”, F.D.R. was “violently tossing aside any respect for our founding principles.” Does anyone doubt that he was speaking for many in his party?

So the supercommittee brought together legislators who disagree completely both about how the world works and about the proper role of government. Why did anyone think this would work?

Well, maybe the idea was that the parties would compromise out of fear that there would be a political price for seeming intransigent. But this could only happen if the news media were willing to point out who is really refusing to compromise. And they aren’t. If and when the supercommittee fails, virtually all news reports will be he-said, she-said, quoting Democrats who blame Republicans and vice versa without ever explaining the truth.

Oh, and let me give a special shout-out to “centrist” pundits who won’t admit that President Obama has already given them what they want. The dialogue seems to go like this. Pundit: “Why won’t the president come out for a mix of spending cuts and tax hikes?” Mr. Obama: “I support a mix of spending cuts and tax hikes.” Pundit: “Why won’t the president come out for a mix of spending cuts and tax hikes?”

You see, admitting that one side is willing to make concessions, while the other isn’t, would tarnish one’s centrist credentials. And the result is that the G.O.P. pays no price for refusing to give an inch.

So the supercommittee will fail — and that’s good.

For one thing, history tells us that the Republican Party would renege on its side of any deal as soon as it got the chance. Remember, the U.S. fiscal outlook was pretty good in 2000, but, as soon as Republicans gained control of the White House, they squandered the surplus on tax cuts and unfunded wars. So any deal reached now would, in practice, be nothing more than a deal to slash Social Security and Medicare, with no lasting improvement in the deficit.

Also, any deal reached now would almost surely end up worsening the economic slump. Slashing spending while the economy is depressed destroys jobs, and it’s probably even counterproductive in terms of deficit reduction, since it leads to lower revenue both now and in the future. And current projections, like those of the Federal Reserve, suggest that the economy will remain depressed at least through 2014. Better to have no deal than a deal that imposes spending cuts in the next few years.

But don’t we eventually have to match spending and revenue? Yes, we do. But the decision about how to do that isn’t about accounting. It’s about fundamental values — and it’s a decision that should be made by voters, not by some committee that allegedly transcends the partisan divide.

Eventually, one side or the other of that divide will get the kind of popular mandate it needs to resolve our long-run budget issues. Until then, attempts to strike a Grand Bargain are fundamentally destructive. If the supercommittee fails, as expected, it will be time to celebrate.

 

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