So much US economic advice towards the EU and other states is shaped by a unique confluence of circumstances that enables the US to run up ginormous consequence-free debt in ways that no one else can.
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Mark Copelovitch
If only 🇪🇺 could get its economic act together & stop inflicting Lost Decades on itself by refusing to do common borrowing/investment on a large scale…
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As the British discovered almost a century ago, unique confluences of circumstances can keep your economy and budgets afloat for a while until they suddenly don't
"Ah, look at the US skating through life without a concern in the world!"
Yes, the EU should integrate better, but growth is sub-par only if you compare with the US. It grows as fast or faster than other developed economies.
Yes, countries are not households. But for any other country this would ring all kinds of alarm bells. Look at France.
All the same, EU debt levels are now basically at the same levels as China and India - the two big rising economies that are supposed to obliterate sedate, decadent Europe.
Perhaps the US can ignore the economic reality that constrains every other country in the world. There has never been a country like the US; with such financial power and such a privileged geopolitical position.
But if it goes wrong, it's going to go wrong badly.
One of the arguments that fiscal expansionists bring up is that austere politics brought about much of the rise of the far-right in Europe.
Really? The US borrowed trillions. It flooded its country with money. How did that work out?
They just move faster into the information space irrespective of circumstances because they don't actually need to figure out what happened. Just find a soundbite that confirms priors.
US totally levered up debt during Covid. Terrible financial policy choices which we've signed onto round two for.
And the thing is; that may be true. Nobody knows. The US is unique in world history. But if anybody can destroy it, it's Trump.
Now, is a Gop caucus gonna give Trump an open checkbook? Some will fight that tooth and nail, but Dems would extract concessions to get funding turned on.