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European Socialism is Only Possible by US Security and International Investment Growth

Posted by mrfixit on November 22, 2010

Recently I was confronted with a question about the picturesque and seemingly near utopian northern European countries of Sweden, and Norway.  These seemingly wonderful places don’t produce mass immigration outbound, and not to the USA, so they must be great, right?  (But do they have inward mass immigration, legal and illegal?  Would that not be a better indicator?)

Ok, so let’s take this one on.   How is it that the socialistic nations of Europe, and even Canada can provide so many “benefits”, like free healthcare and then not totally crush their people with taxes and destroy their own economies?  I had a Canadian friend once who complained about the expense of his healthcare in the US, and his assessment was he paid about the same in overall taxes here, but got less in return.  That on the surface seems like a rip off for sure, but it misses some really important differences.

First it is the USA that provides the worlds security, and that is directly paid by the US taxpayer.  We spend over 60% of the entire worlds defense spending.  Just the US and its taxpayers.  Now consider for a minute that one US aircraft carrier with its crew is about as many sailors at the ENTIRE Canadian Navy, and perhaps you might get some perspective o this problem.

Our security provides others the ability to have largely symbolic, tiny military forces that draw tiny portions of their respective national economies.  Essentially the US is giving for free security welfare that permits these other countries to use defense money for social programs and handouts.

Here is the data on defense spending, the US paying more that every other country, COMBINED:

http://www.globalsecurity.org/military/world/spending.htm

And here you can see that compared to GDP (Gross Domestic Product) the US spends more than Europe by GDP percent, but this also should tell you something about GDP when you consider the overall US Spending, our GDP is MASSIVE compared to these European nations, even taken together.

http://www.visualeconomics.com/military-spending-worldwide/

Now, take into consideration that the old world economies have evolved into mostly investors, they invest the money they have in places that still have economic growth and use THAT growth to continue their spending.  Europe is in a population decline, and without the waves of immigrants they’d be in a total free fall.  Their immigrants are largely NOT interested in assimilation either, making very real the possibility that Europe will one day look more like Iran.

Declining population:

http://news.bbc.co.uk/2/hi/europe/4768644.stm

http://www.rand.org/pubs/research_briefs/RB9126/index1.html

You see the ability to sustain ever growing ‘benefits’ requires workers to pay into the system.  These workers are more and more offshore; the value they create is siphoned off the interest growth of the investor class.  This interest and the few remaining workers pay for the system.  When the demand out paces the growth, and there are no workers left it will collapse.  It is teetering on edge right now, Greece, Iceland, Ireland, Portugal, Spain, UK practically all of the EU is facing serious austerity measures to curb out of control spending and declining economic growth and activity.  The un-sustainability is approaching the end of its run.

This data clearly shows the declining economies of Europe:

http://www.worldbank.org/depweb/beyond/beyondco/beg_04.pdf

More on declining economic growth in Europe:

http://www.bbc.co.uk/news/business-11740908

This shows the details, growth rate in economy in the great Sweden and Norway is averaged at around zero or so over the last 3-4 years:

http://www.imf.org/external/pubs/ft/reo/2010/eur/eng/ereo1010.pdf

So, while the appearance of the European utopia to the tourist might seem appealing, it is a point in time, it is a mask to cover some serious underlying societal flaws that will lead to the demise of that image if serious changes do not occur really soon.  Without some real economic growth, real value creation, real economy, the picturesque utopia is really living on borrowed time, and we are only slightly behind Europe in this respect.

My prior comment on the out of control spending and lack of ability to meet obligations:

https://minorityrightsadvocate.wordpress.com/2010/10/21/we-are-living-on-borrowed-time-literally/

At the end of the day, wealth is produced by value creation.  Value creation comes from taking a something of lesser value, adding labor and ingenuity to create something of higher value, a simple example, take iron ore and make iron, or take iron and make a car, etc.  This works in services also, the product has more value, and the more activity the larger the economy and the more wealth there is.

It is NOT money that has value, money reflects the value of the things it buys, more on this with my prior post about inflation:

https://minorityrightsadvocate.wordpress.com/2010/11/09/massive-inflation-is-coming-protect-yourself-get-away-from-cash-investments-now/

So, if much of Europe is in decline in population and value creation, then it will eventually end in a collapse of the supposed utopia some have come to know, and it is happening right now.  I only hope the USA can wake up and NOT follow this lead!

So, the so called great European socialist utopias have only been allowed to exist thanks to the security of US defense and the investments in growth in other parts of the world.  Without those factors, the supposed utopia would have never been permitted to exist, but those factors are not permanent.  The foundations of these superficially ideal societies are built on shifting sand.  As the US is in decline, so will our ability to provide security, and as those investments in growth slowdown and the demands for “benefits” and entailments increase, Europe will collapse.   The needed changes will be difficult to stop this, and thus fare the political will and population acceptance of those changes seems very unlikely.

Previous post on Europe’s crisis:

https://minorityrightsadvocate.wordpress.com/2010/10/25/europe-is-disintegrating-why-do-elite-progressives-demand-we-follow-europe/

More:

Europe on the edge:

http://www.theblaze.com/stories/gloom-anger-spreads-as-european-economies-teeter/

EU on the brink of collapse:

http://online.wsj.com/article/SB10001424052748704693104575638132375883318.html?mod=WSJ_hp_LEFTTopStories

Even Germany is in trouble:

http://www.telegraph.co.uk/finance/financetopics/financialcrisis/8160999/EU-rescue-costs-start-to-threaten-Germany-itself.html

More:

Apparently Sweden not only has a problem with less than replacement birth rate, there is a lot of alternate sexual activity taking place, with some of its own consequences: more cancer!

http://www.bloomberg.com/apps/news?pid=newsarchive&sid=alW7.lnSW62s&refer=science

History in repeat mode:

http://www.theblaze.com/stories/u-k-speaker-preaches-failure-of-capitalism-and-rise-of-socialism/

http://www.theblaze.com/stories/student-protests-turn-violent-in-rome/

Now it is direct bailouts (the TARP largely ended up in Europe already), from an already broke nation, how does that work?

http://www.cnbc.com/id/40454469

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One Response to “European Socialism is Only Possible by US Security and International Investment Growth”

  1. […] https://minorityrightsadvocate.wordpress.com/2010/11/22/european-socialism-is-only-possible-by-us-sec… […]

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