The victory of Angela Merkel’s coalition in Germany’s elections last week was a victory for centrist economic policies over more progressive ideas. Germany has been much better at handling the economic storm than England or even the United States, largely due to more conservative economic policies. They are by no means a paragon of Austrian economics (consider Deutschland’s cash-for-clunkers program), but they might be relative to other nations. Irwin Steizer comments in today’s Times Online on this interesting unfolding of events in Europe, which could have just as easily loaded up a completely socialist economic response everywhere:
The communist spectre that Karl Marx confidently predicted would be haunting Europe is instead haunting Europe’s left-wing parties, with even Vladimir Putin seeking to attract investment by re-privatising the firms he snatched. Which raises an interesting question: why haven’t the economic turmoil and rising unemployment led workers to the barricades, instead of to their bankers to renegotiate their mortgages?
It might be because Spain’s leftish government has proved less able to cope with economic collapse than countries with more centrist governments. Or because Britain, with a leftish government, is now the sick man of Europe, its financial sector in intensive care, its recovery likely to be the slowest in Europe, its prime credit rating threatened. Or it might be because left-wing trade unions, greedily demanding their public-sector members be exempted from the pain they want others to share, have lost their credibility and ability to lead a leftward lurch.
Read the whole piece here.