Socialism Is Why Greece, Italy And Detroit Suffer

 

Government Failure: From Greece to Portugal to Detroit, it would seem some alien being called "austerity" has descended on their bankrupt economies. In reality, it's the consequences of socialism itself.

 

Socialism: Railing against "austerity," from Greece to Italy to Portugal to even Detroit over the weekend, it would seem some unwelcome alien being has descended on these once-vibrant socialist economies. In reality, it's the consequences of socialism itself.

 

No doubt about it, austerity is bitter medicine. From higher taxes to cuts in public spending, to the reality that some multilateral entity is now managing a state's affairs, nobody likes to live in a bankruptcy zone under austerity.

 

In Portugal, more than a million protesters flooded the streets of Lisbon and other cities, shouting "austerity kills," "this government must fall" and "screw the troika," a reference to the IMF, European Commission and European Central Bank, which together have demanded tough fiscal measures of Portugal in exchange for a $102 billion bailout.

 

The government, which is also under pressure, is seeking an extended repayment plan from Brussels, hoping to delay the pain. So far, the eurozone and IMF, now conducting their quarterly review, are considering it.

 

A similar scene took place in Greece over the weekend, where the EU and IMF auditors are getting an earful from public employee union members such as teachers, and recipients of state subsidies such as students and farmers, who have massed in the hundreds of thousands to denounce Greece's austerity plan, code-named Athena, which was required for a bailout.

 

"Leave now, your measures are killing us," read a protest banner hoisted outside parliament.

 

And in Italy a week ago, voters rattled markets by voting for anti-austerity candidates on the left and right, which means more spending and little fiscal reform.

 

These examples aren't unique.

 

The wages of socialism can be seen in the city of Detroit, too. It was put under state receivership Friday because, like Italy, Greece and Portugal, it is bankrupt and can't cut spending to balance its books.

 

The state of Michigan is its caretaker, just as European states have the IMF and EU, and the protests, from city officials at least, have been pretty loud.

 

Wailing about "austerity" misses the point. Austerity is the inevitable result of socialist math: "running out of other people's money," as former British Prime Minister Margaret Thatcher pithily put it.

 

Redistributing from one sector to another to redress unequal wealth is an inherently unsustainable idea. Austerity or total collapse are the only logical outcomes.

source