Sunday, December 26, 2010

Europe's debt Crisis and Toronto Sun idiocy

Calling someone a social conservative used to be just a polite way of calling them a moron.

Today one need not even include "social". Calling them a conservative will suffice.

"The welfare state has roared back to bite the British lion in the rump.

Ditto for the Irish economy.

Saddled with massive debt and staggering under unaffordable social programs, both the British and the Irish are facing massive cuts.

Britain is cutting everything from the military to social services.

Ireland is bankrupt."


http://www.torontosun.com/comment/editorial/2010/12/22/16650641.html

The notion that generous social programs sank the UK and Ireland is nonsense and so is the acronym "pigs". Spain and Ireland were running surpluses. What sank Spain and Ireland was a huge real estate bubble and inability to devalue their currency. Ireland's debt to GDP doubled over night when the government guaranteed the debts of private banks. The same thing happened in the UK. City Boy bailouts are the main reason UK debt almost doubled.

As for viability of the Welfare state, no one has more generous social programs than the Scandinavian countries and no one in Western world has lower debt levels. Sweden, Finland and Norway have more assets than debts and Denmark virtually the same amount of debts as assets.

http://www.economist.com/blogs/buttonwood/2010/02/debt_deficits_and_growth

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