Europe is looking hotter by the day. If ALA buys NN it will
be " vonderful dahling ".
Europe is cutting down their deficits.
Unlike the US however, Europe has a better handle on what is
likely to kill the US Economy unless something is done to fix it:
Skyrocketing Medicare costs to buy expensive medical technology
for people who are terminal to begin with. Some will define terminal as deadÿ
within 6 months, some within 1 year.But even 2 years makes some sense
when you consider that in the US, 3/4 of all your lifetime's health care dollar
gets spent in the last 2 years of your life, with paltry results to show for.
Last 2 years of anybody's life are quite poor quality wise.
Anyway this problem does not exist in Europe.
In England, if you are 55 and over, you do not get
admission to a Coronary Care Unit for a heart attack
and you don't get a coronary by pass.No dialysis.
The English have determined that survival rates
do not justify the exorbitantÿ expense.
So Europe may come out of their Socialist slumberÿ
in much better shape.As they are testing the explodingÿ
benefits of the Internet, they will drop everything thatÿ
stands in the way.They already have tried failingÿ
socialism.
In the US instead the Socialist dream of cradle to
grave care is not dead yet .( Just turn your TV on ).
Here is a recent article on Europe:
Wall St. Jour:
February 7, 2000ÿ
ÿÿ
ÿÿ
interactive.wsj.com;
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ The Outlookÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿ BERLINÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ Dutch Finance Minister Gerrit Zalm was so pleased lastÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ year when his country achieved its first budget surplus inÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ 25 years that he gave his cabinet members a cake.ÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ Inscribed in the icing: "A new time. We lost the deficit."ÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ The Netherlands may have arrived there sooner thanÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ other European economies, but others are moving in theÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ same direction. Thanks both to fiscal discipline forcedÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ on them as a condition of taking part in economic andÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ monetary union and to greater-than-forecast revenueÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ produced by rebounding economies, the 11 countries thatÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ share a common currency are moving surprisingly fastÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ toward budget surpluses, a feat the U.S. accomplished inÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ 1998.ÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿ Euroland'sÿÿ budgetÿ deficit last year fell toÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿ an estimatedÿ 1.6% ofÿ gross domesticÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿ product (theÿ value of allÿÿ goods andÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ services produced in the region), down from a peak ofÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ 5.5% of GDP in 1993, according to the Organization forÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ Economic Cooperation and Development in Paris. "Thisÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ is a sea change," says Ignazio Visco, the OECD's chiefÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ economist.ÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ Even Italy, the slowest-growing economy in the euroÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ zone last year, is beating the odds. The governmentÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ now expects a deficit of about 2% of GDP, a bigÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ change from last March when it warned that itsÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ deficit would likely be a greater-than-expected 2.4%.ÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ Economists predict that, though some countries will stillÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ be in the red, the combined budgets of the EMU 11 willÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ be in the black by 2003. The region could get there evenÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ faster, though Euroland governments are likely to spendÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ more and cut taxes modestly in the near term, withÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ parliamentary and presidential elections looming in theÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ five largest countries.ÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ But surpluses are no political piece of cake. The issue:ÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ What to do with a surplus. Pay down debt? Cut taxes?ÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ Increase spending? The debate in Europe promises to beÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ as rancorous as it has been in the U.S. Some Republicansÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ in the U.S. want to use the country's good fortune toÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ lower taxes and give money back to the people.ÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ American Democrats want to increase spending onÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ education, health care and other social programs.ÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ Gridlock prevails, so the bulk of the surplus is goingÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ toward paying down the federal debt.ÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ "It will be a happy time in Europe when we can discussÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ these sorts of things," says Otmar Issing, chief economistÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ of the European Central Bank. But such discussionsÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ aren't so far away, Mr. Issing. And they won't always beÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ pleasant.ÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ In the Netherlands, the debate already has grown nasty.ÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ First, Hans Digkstal, chairman of the conservative Partyÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ for Freedom and Democracy, called for the surplus to beÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ used to pay down the country's debt. Then, Sweder vanÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ Wignbergen, a well-known economist, compared Mr.ÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ Digkstal with Nicolae Ceaucescu of Romania, whoÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ obsessively drove down his country's debt while hisÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ countrymen suffered from a lack of basic services. Theÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ article prompted angry denunciations on Dutchÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ television.ÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ In Norway, a Labor Party-led government was thrownÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ out of office in 1997 over its handling of the surplus. Atÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ the time, the country was enjoying a surplus of 7.9% ofÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ GDP, thanks to a surge in oil prices.ÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ Trying to curb inflation, the government tightened fiscalÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ policy. But belt-tightening at the time of a big surplusÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ didn't go over well with voters.ÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ Expect discussions to heat up next in France, where theÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ OECD expects the budget deficit to fall to 1.7% of GDPÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ this year, compared with 5.6% in 1995. Economists sayÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ the government could reach a surplus in 2003, or evenÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ earlier if the recent good economic news continues. Aÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ French newspaper report last week said that tax revenueÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ for last year was about 66 billion francs ($9.97 billion),ÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ or 4.3%, higher than expected.ÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ French Finance Minister Christian Sautter vows to resistÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ pressure to use the windfall to increase spending, andÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ says he tells fellow cabinet ministers in the Socialistÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ government that shrinking the fraction of the governmentÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ budget that goes to debt service is the only way to makeÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ room for other spending. Any windfall will be splitÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ between tax cuts and faster-than-projected deficitÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ reduction, he promises.ÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ Germany, too, is using some of a revenue windfall toÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ finance tax cuts while moving simultaneously towardÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ balancing its budget in 2005.ÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ To fiscal conservatives in bond markets, central banksÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ and investment houses, these signs are unadulteratedÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ good news. But to politicians, the prospect of surplusesÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ in the next several years will make austerity budgets andÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ overdue pension reforms much harder to sell. Theÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ political challenges produced by fiscal health may beÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ just as difficult to manage as those caused by the deficitÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿ malady of the past.ÿ
ÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿÿ -- Christopher Rhoadsÿ
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