EU Future: The Authoritarian Welfare State

My article about how the United Nations is aspiring to build a global welfare state caught a lot of interest. I am happy to see that, because it is difficult to find anything that would be more damaging to our freedom and prosperity than a new layer of government on top of the ones we already have. And it does not exactly make things better that this global welfare state would be run by unelected bureaucrats and politicians appointed for the most part by corrupt dictatorships.

Today we can report about another big-government power grab. The EU Observer explains that the unelected president of the unelected European Commission, Mr. Jose Manuel Barroso, wants the member states of the EU to agree…

…to a big common budget, a future banking union and – ultimately – political union in order to save the EU.

The EU was built as a non-elected bureaucracy (the elected European Parliament has no real legislative power) and is run from the top down by the EU Commission. The structure is reminiscent of an old, pre-democracy European nation state where the appointees and bureaucrats at the top believed that they knew better than the people, by virtue of the very position they held. Those “benevolent” dictatorships obviously did not work – by the time the United States was founded and economic and individual freedom suddenly had taken tangible shape in people’s minds, the old European way of organizing a country was rapidly proven inferior.

Today’s Eurocracy is blissfully ignorant of this history (as is, sad to say, a good part of America’s liberal intellectual elite), which is a main reason why they are so adamant about reliving Europe’s embarrassing history, only at a grander scale.

Back to the EU Observer story, which reveals in chilling detail what the EU elite has in mind:

Barroso, EU Council president Herman Van Rompuy, European Central Bank chief Mario Draghi and Jean-Claude Juncker – the head of the euro-using countries’ club, the Eurogroup – are drafting a joint paper on how EU leaders can stop the crisis. The text will be a political manifesto rather than a legal proposal, officials say. “I will urge the European Council to take concrete commitments towards a fully developed economic and monetary union and a process that maps out the steps how to get there,” Barroso told MEPs. He said countries must agree here and now to generous EU spending in the 2013 to 2020 period. He noted that 97 percent of public investment in Hungary and over 50 percent in Poland comes from EU funds. “What would the situation be in these countries without the contribution of the European budget?” he asked.

Before we get to the nonsense that is in this manifesto, let’s note what is not in it: a closer tie between the people of Europe and its leaders. What is taking shape here is instead more of the same, namely more power to the unelected officials at the helm of the various heads that constitute the EU hydra.

The current EU was built upon the Maastricht Treaty from 20 years ago, a treaty that was very elaborate in how the EU member states were supposed to run their government finances. It even specified that economic growth was a matter of making the labor market work better – not a word about small government and low taxes. This treaty was in turn built on research provided in good part by Robert Mundell, who won the Nobel Memorial Prize in Economics in 1999. The foremost application of Mundell’s highly praised research is the economic integration of Europe.

We can now look back at the outcome of putting Professor Mundell’s research to work. It looks about as successful as the work of two other Nobel Prize-awarded economists, namely the notorious pair Merton and Scholes whose scholarly achievements went down in flames with the colossal failure of Long Term Capital Management.

In addition to the fact that the EU was built according to erroneous economic architecture, the fact that Barroso’s new political manifesto has no room for democracy should really worry Europe’s friends of freedom and prosperity. But they should be equally worried by what the manifesto envisions for the near future: a large EU budget, obviously funded by direct EU taxes – which would of course come on top of the taxes that Europe’s overburdened taxpayers already dole out to local and national governments.

More government spending is about the last thing the EU needs. It is screamingly evident that Mr. Barroso and his fellow Europhorics have not learned a single syllable from the crisis in Greece. The Greek disaster was not brought about by too little government spending.

As for the references to Hungarian and Polish infrastructure investments being paid for by the EU, here is what I wrote about that a month ago:

How convenient. First you create a spending program and lure countries into taking the money instead of funding their schools, hospitals and infrastructure themselves. Then you go to taxpayers and say: “Do you really want to leave these poor saps out in the cold? How greedy are you?” The Hungarians and Poles are perfectly able to invest in their own education, health care and transportation systems. Countries in formerly Western Europe did it without help from other countries.

When this new super-EU has run out of taxpayers’ money, just like Greece, Spain, Italy, Portugal, Netherlands and very soon France – then what is Mr. Barroso going to do? Go to the UN and ask for a cut of those global taxes?

As the EU Observer article reveals, Barroso and the Europhorics are completely oblivious to these issues – on the contrary, they are just dying to reinvent the square wheel:

Barroso’s final step – fiscal and political union – would see EU countries issue joint bonds, co-ordinate tax policy and co-ordinate national spending on everything from healthcare to schools and social welfare. He noted that some non-euro-using countries might want to stay out. But he added: “Our economic relations bind us all: euro area members and non-members alike, our futures are linked.” Leading MEPs said things should move more quickly.

How about that: a full-fledged EU-run welfare state. When Europe’s national welfare states have dragged the entire continent into a state of stagnant, industrial poverty, what better solution than to really up the ante and let a bunch of unelected appointees in Brussels take over and run the show?

If an authoritarian behemoth of a welfare state was the way to freedom and prosperity, then why did America outlast the Soviet Union?