Posts tagged with: europe

Blog author: jcarter
posted by on Tuesday, September 18, 2012

Financially strapped politicians in Europe think they may have found a way to tap into a new source of revenue: tax the Catholic Church.

Rubio, a city council member in Alcala, is leading an effort to impose a tax on all church property used for non-religious purposes. The financial impact on the Catholic Church could be devastating. As one of the largest landowners in Spain — with holdings that include schools, homes, parks, sports fields and restaurants — the church could owe up to 3 billion euros in taxes each year.

“We want to make a statement that the costs of the crisis should be borne equally by every person and institution,” said Rubio, a 36-year-old former accountant in his first term in office.

Similar efforts that target church coffers or powers are underway in neighboring countries. In Italy, Prime Minister Mario Monti has called for a tax on church properties or on those portions of properties that have a commercial purpose. In Ireland, the minister of education is fighting to end church control of many of the country’s primary schools, and the government has slashed in half the grants it gives poor families for first Communions. More than half the city councils in Britain have eliminated state subsidies for transportation to faith-based schools, leading to a precipitous drop in enrollment.

Once an untouchable institution in some parts of Europe, the Catholic Church has come under fire for its government subsidies at a time when the continent’s economies are faltering and the population is subject to painful cuts in jobs, benefits and pensions.

Read more . . .

Online today at The American Spectator is an article from Acton Research Director Samuel Gregg. The article highlights the forethought of German economist Wilhelm Röpke, who predicted Europe’s present economic downturn in the middle of the twentieth century. Röpke, Gregg says, was a “euroskeptic” before the term existed. Excerpt here:

Where Röpke proved correct was in envisaging that efforts to impose European political integration from the top-down would go hand-in-hand with attempts to replicate large welfare systems and extensive regulation across Europe. What’s now called “Social Europe,” Röpke maintained, was integral to the same dirigiste and rationalist mindset that viewed extensive planning by political-bureaucratic elites as infinitely superior to the workings of Adam Smith’s invisible hand within a legal framework of clear rules and limited government.

Röpke died in February 1966, decades before the present crisis that’s created a bleak economic future for an entire generation of young Europeans and turned the phrase “Greece” into a byword for dysfunctionality. Like many prophets, Röpke’s predictions about the long-term effects of choices made by European leaders in the 1950s and 1960s were mocked in his own time. But in the unlikely event of Europe’s political masters escaping the echo chamber that tells them that salvation can only be found in ever-greater centralization, those whose knowledge of history extends beyond the last 24 hour news cycle might be honest enough to admit that Röpke was right.

And the PIIGS might fly.

Entire article here.

In what was dubbed the “Bailout Game” of the 2012 European Championships, the German national team defeated their Greek counterparts, the 4-2 score only slightly representative of the match’s one-sidedness. The adroit, disciplined Deutscher Fuβball-Bund owned 64% of the ball, prompting at least one economic retainment joke and the asking of the question: What does this game mean for Europe?

Not much, according toIra Broudway of Bloomberg Businessweek, who last week issued a preemptive “calm down” to the throngs of journalists, broadcasters and politically-aware fans itching to work their witticisms into the soccer-as-political-grudge-match conversation. Chill out, he says; thinking soccer could have any say in the realm of global affairs is “mass lunacy.” He’s right, the German’s systematic defeat of the Greece’s beloved Blue-White’s won’t spur any continental economic legislation or seal Greek’s fiscal fate. But maybe Broudway’s treatment of the match’s relevance is a tad too dismissive.

To deny the social influence of sports, especially in soccer-crazed Europe, is to forget about a history of cultural milestones. Less than two weeks before Germany and Greece met on the pitch, international tensions between Poland and Russia, together with a poorly-scheduled game-time resulted in violent riots on the streets of Warsaw. For a brighter recollection, think only of the Miracle on Ice, the 1995 Rugby World Cup or you name that sporting-event-turned-movie. For better and for worse, athletics have an undeniable ability to inspire and incite.

But what’s behind this potential? Social scientist Arthur Brooks, president of the American Enterprise Institute, has written and spoken widely on the topic of “earned happiness.” It’s difficult to think of a realm that encourages earned happiness more than athletics. Sports pit conflicting dreams of teams, cities, nations against each other and promise fulfillment to the winner. Done fairly, competition even maximizes potential for all involved parties.

Imagine the consequence of a Greek victory. No, a victory wouldn’t have paid back billions of euros of debt, but it might have reaffirmed the possibility of achievement for a people decimated by a burdensome fiscal situation. It may have at least modeled the idea of earned happiness for a society that today knows more about learned dependency.

Who knows, maybe that dream still exists for one of Europe’s debt-ridden nations. Germany’s next opponent? Italy. Squaring off on the other side of the bracket? Portugal and Spain. Soccer fans and the globally-concerned can at least speculate about the cultural implications of the coming week of soccer, and what it has to say to Europe’s present economic context. Vamos!

How about a tax on fires?

On National Review Online, Acton Research Director Samuel Gregg examines the push for a “transaction tax” to solve some of the fiscal problems in the European Union. The move would, Gregg explains, “levy a tax on any transaction on financial instruments (securities, loans, deposits, derivatives, and various asset classes) between banks, hedge funds, insurance businesses, investment companies, and other financial organizations whenever one contracting party is located in the EU.” That may not sound like much, but would apply to literally millions of financial transactions daily. The scheme has drawn the support of “EU apparatchiks” but the opposition of the British who see the tax proposal as a threat to London’s financial competitiveness. Gregg sees what’s behind it:

In short, the EU’s transactions-tax scheme reflects a long-standing desire to “throw sand” in the wheels of financial globalization. Its origins lie in what’s called the “Tobin tax,” named after the American economist James Tobin, who argued in 1972 for the levying of a 0.5 percent tax on all spot-currency conversions. The point, for Tobin, was to discourage “speculators” who “invest their money in foreign exchange on a very short-term basis.”

Unfortunately for its advocates, there’s considerable evidence that Tobin-like taxes on financial transactions don’t reduce volatility. In the midst of financial crises, long-term and short-term investors behave in very much the same way — they get out, and transaction taxes don’t prevent them from abandoning ship. Greece, for example, currently applies a transaction tax to the sale of Greek-listed shares. That, however, isn’t doing much to prevent the present exodus of capital from Greece.

Taking the broader view, it’s hard to avoid concluding this latest EU harmonization boondoggle is about two things. First, it’s a way for EU officials and governments to appear to be punishing European financial institutions for their contributions to Europe’s economic crisis. Second, it reflects the general European failure to come to grips with some of the deeper problems contributing to Europe’s debt crisis.

Read “Financial Fiddling while the Euro Burns” by Samuel Gregg on NRO.

Writing on The American Spectator website, Acton Research Director Samuel Gregg looks at the strange notion of European fiscal “austerity” even as more old continent economies veer toward the abyss. Is America far behind?

Needless to say, Greece is Europe’s poster child for reform-failure. Throughout 2011, the Greek parliament passed reforms that diminished regulations that applied to many professions in the economy’s service sector. But as two Wall Street Journal journalists demonstrated one year later, “despite the change in the law, the change never became reality. Many professions remain under the control of professional guilds that uphold old turf rules, fix prices and restrict opportunities for newcomers.” In the words of one frustrated advisor to German Chancellor Angela Merkel, “Even when the Greek Parliament passes laws, nothing changes.”

Politics helps explain many governments’ aversion to reform. Proposals for substantial deregulation generates opposition from groups ranging from businesses who benefit from an absence of competition, union officials who fear losing their middle-man role, to bureaucrats whose jobs would be rendered irrelevant by liberalization. The rather meek measures that Europeans call austerity have already provoked voter backlashes against most of its implementers. Not surprisingly, many governments calculate that pursuing serious economic reform will result in ever-greater electoral punishment.

In any event, America presently has little to boast about in this area. States such as Wisconsin have successfully implemented change and are starting to see the benefits. But there’s also fiscal basket-cases such as (surprise, surprise) California and Illinois that continue burying themselves under a mountain of debt and regulations.

Read “Why Austerity Isn’t Enough” by Samuel Gregg on The American Spectator.

In a new analysis in Crisis Magazine, Acton Research Director Samuel Gregg examines “the shifting critiques” of the pontificate of Benedict XVI including the latest appraisal that the world is losing interest in the Catholic Church particularly because of its declining geopolitical “relevance.” But how do some of these critiques understand relevance?

On one reading, it involves comparisons with Benedict’s heroic predecessor, who played an indispensible role in demolishing the Communist thug-ocracies that once brutalized much of Europe. But it’s also a fair bet that “relevance” is understood here in terms of the Church’s capacity to shape immediate policy-debates or exert political influence in various spheres.

Such things have their own importance. Indeed, many of Benedict’s writings are charged with content which shatters the post-Enlightenment half-truths about the nature of freedom, equality, and progress that sharply constrict modern Western political thinking. But Benedict’s entire life as a priest, theologian, bishop, senior curial official and pope also reflects his core conviction that the Church’s primary focus is not first-and-foremost “the world,” let alone politics.

Read “Benedict XVI and the Irrelevance of ‘Relevance’” on the website of Crisis Magazine.

On The American Spectator, Acton Research Director Samuel Gregg observes that, “as evidence for the European social model’s severe dysfunctionality continues to mount before our eyes, the American left is acutely aware how much it discredits its decades-old effort to take America down the same economic path.” Against this evidence, some liberals are pinning the blame on passing fiscal and currency imbalances. No, Gregg says, there’s “something even more fundamental” behind the meltdown of the post-war West European social model. (Thanks to RealClearWorld for linking).

… this reality is that the Social Democratic project is coming apart at the seams under the weight of the economic policies and priorities pursued by most Social Democrats (whatever their party-designation) — including the American variety.

From the beginning, post-war Social Democracy’s goal (to which much of Europe’s right also subscribes) was to use the state to realize as much economic security and equality as possible, without resorting to the outright collectivization pursued by the comrades in the East. In policy-terms, that meant extensive regulation, legal privileges for trade unions, “free” healthcare, subsidies and special breaks for politically-connected businesses, ever-growing social security programs, and legions of national and EU public sector workers to “manage” the regulatory-welfare state — all of which was presided over by an increasingly-inbred European political class (Europe’s real “1 percent”) with little-to-no experience of the private sector.

None of this was cost-free. It was financed by punishing taxation and, particularly in recent years, public and private debt. In terms of outcomes, it has produced some of the developed world’s worst long-term unemployment rates, steadily-declining productivity, and risk-averse private sectors.

Above all, it slowly strangled the living daylights out of economic freedom in much of Europe. Without Germany (which, incidentally, also engaged in welfare reform and considerable economic liberalization in the 2000s), it’s hard to avoid concluding that Social Democratic Europe would have imploded long ago.

Read “The American Left’s European Nightmare” by Samuel Gregg on The American Spectator.

A week ago, Dr. Samuel Gregg addressed an audience here at Acton’s Grand Rapids, Michigan office on the topic of “Europe: A Continent in Economic and Cultural Crisis.” If you weren’t able to attend, we’re pleased to present the video of Dr. Gregg’s presentation below.

Blog author: michael.severance
posted by on Monday, February 13, 2012

Daniel Hannan, a British Member of the European Parliament, issued a strong warning to conservative Americans worried about their country’s future in a speech he delivered at the CPAC rally last week in Washington.

The self-proclaimed Euroskeptic and author of The New Road to Serfdom, warned U.S. political conservatives not to follow in Europe’s tragic footsteps by allowing their governments to seize too much power and create dependency on mismanaged socialized government programs — the very Welfare State culture that has a strangle hold on the Old Continent’s major economies such as Britain, France, Germany and Italy.

In Hannan’s opinion, Europe is “in the grip of a prolonged winter … of discontent” where there are nation-wide protests and grumbling every day against political and economic liberalization — but with little hope for actual change.  Europe is in such a dire state, he says, because it is has long lost its culture of enterprise and self-responsibility.

Hannan said he always admired Americans for their optimism and “anything’s possible” attitude, but they need to make sure their “rulers remember they are not rulers but representatives.”  He humorously noted that in Belgium, where he works in European Parliament, the country was without a government for nearly two years “and it was working brilliantly!”

Below you can watch Hannan’s interview and full speech delivered at CPAC.

Blog author: jcouretas
posted by on Friday, January 20, 2012

[Thanks to RealClearWorld, ThePulp.it, NewsBusters and PewSitter.com for linking to this commentary.] Over at the American Spectator, Acton Research Director Samuel Gregg points to Europe’s “perceptible inability” to acknowledge some of the deeper dynamics driving its financial crisis. And these are primarily a “slow-motion population implosion” complicated by the exodus of young European Union citizens and the return of hundreds of thousands of immigrants to their homes in developing nations. That is an ominous development for a region where the dependency rate — the ratio of retirees per member of the labor force — has ratcheted up as the welfare state has ballooned over several decades.

Gregg:

These facts have made some Europeans willing to ponder the necessity of labor-market and welfare reform, not least because those countries that have weathered the crisis better than others (e.g., Germany and Sweden) actually implemented such changes in the 2000s. Getting Europeans to talk publicly about the continent’s population-trends and their economic consequences, however, is a different matter.

Why? One reason is that many Europeans have long been in thrall to the over-population gospel. Long before Paul Erhlich’s The Population Bomb (1968) — whose doomsday future-scenarios of a world devastated by famines, mass disease, and social unrest unleashed by overpopulation never materialized — numerous European economists had bought into this thesis.

In 1798, the Anglican vicar and one of the first modern economists, Thomas Malthus, published his Essay on the Principle of Population. This argued that growing populations would produce an increasing labor-supply. The result, Malthus insisted, would be lower wages and therefore mass poverty. “The power of population,” he claimed, “is so superior to the power of the Earth to produce subsistence for man, that premature death must in some shape or other visit the human race.” Another English philosopher-economist, John Stuart Mill, was so convinced by Malthusian arguments that he actually spent time in London parks distributing birth-control pamphlets to bemused onlookers.

Read Samuel Gregg’s “Europe in Demographic Denial” on the American Spectator.