Most pundits are crediting this U-turn to the political muscle of the Tea Party and it’s true that President Obama would never have agreed to this deal if the Tea Party Republicans in the House of Representatives hadn’t engaged in the brinkmanship of the past few weeks. But to focus on the Tea Party is to ignore the tectonic political shift that’s taken place, not just in America but across Europe. The majority of citizens in nearly all the world’s most developed countries simply aren’t prepared to tolerate the degree of borrowing required to sustain generous welfare programmes any longer.
As I pointed out in a blog post last May, tax-and-spend Left-wing parties have fared poorly in election after election over the past two years:
Labour was punished by the British electorate last year, polling its lowest share of the vote since 1983, but not as severely as the Social Democrats were by the Swedes, polling their lowest share of the vote since universal suffrage was introduced in 1921…
The same picture emerges wherever you look. In the European election in June, 2009, the Left took a hammering. In Germany, the Social Democrats polled just 20 per cent of the vote, their worst result since the Second World War. In France, the Socialist Party only mustered 16.5 per cent, its lowest share of the vote in a European election since 1994. In Italy, the Democrats polled 26.1 per cent, seven percentage points less than they received at the last Italian election. As David Miliband pointed out in a recent lecture: “Left parties are losing elections more comprehensively than ever before. They are fragmenting at just the time the Right is uniting. I don’t believe this is some kind of accident.
To which we can only say, let us hope so. Perhaps this deal is in fact the political equivalent of President George H.W. Bush reversing his “read my lips: No. New. Taxes.” pledge in 1990, which contributed mightily to his subsequent loss on 1992. And so we have the best of both worlds politically: a deal that leaves the Tea Party unsatisfied and therefore fired up for the next battles and election cycle, and a demoralized liberal base that can’t come to grips with the fact that socialism is over because we’ve run out of other people’s money—a point made in Toby Young’s blog on another British paper today, The Telegraph.
The Tea Party has just been America’s front seat airbag as we collided with our national debt wall. It gave us a little bit of protection at the last possible fraction of a second. Or maybe a collision avoidance alarm, buzzing in our ears. It won’t matter, we’re hitting the wall one way or another.
The main political parties would have let us smack into it at full speed, no seatbelts, no airbags, no warning. Anything but acknowledge the problem or take responsibility for our financial profligacy. The Tea Party is just making tit harder for them to claim ignorance, and harder to climb over the other passengers as they seek a safer seat in the back. Thats what TARP and QE1 and QE2 are all about, and what QE3 will be about – the well connected looking to put as many other bodies between them and financial disaster as possible. They were at the wheel, and now that they see the coming wreck, they are trying to put distance between themselves at it. The Fed is just the mechanism for robbing blue-collar taxpaying passenger Peter so that politician or crony corporate capitalist driver Paul can retire comfortably.
Or to use another analogy, Obama and most of Congress are the Titanic deck officers telling the 2nd and 3rd class passengers all is well and ushering them back down to their cabins in steerage, as they let their rich first class passenger friends board the lifeboats and grab up all the life preservers. The word to remember in the future is “complicit”.
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