Acton Commentary

Downfall: Europe's Failed Political Class


The casualty list from Europe's apparently-endless financial crisis continues to grow. If you're young, a taxpayer, or a German in today's EU, you have good reason to believe you've been dealt a very bad hand.

There is, however, one impending casualty whose demise is fully merited. And that's the credibility of Europe's political class.

Having assured Europeans for the past 50 years that they know what they are doing, Europe's politicians are now helplessly presiding over the continent's worst economic maelstrom since the Depression: a calamity to which their policies have considerably contributed.

And it is a class of European politicians to which I'm referring -- a group that's even developed distinctly familial characteristics.

One European politician who's been in the spot-light since 2009, Greek Prime Minister George Papandreou, is the son and grandson of former Greek prime ministers Andreas Papandreou and George Papandreou Sr. The word "dynasty" comes to mind.

Likewise, a front-runner for the Socialist party's nomination for French President in the 2012 elections, Martine Aubry, is the daughter of Jacques Delors. Aside from being the eighth European Commission president, Delors served as economics minister under France's late President, François Mitterrand.

Speaking of the Mitterrands, François's nephew, Frédéric Mitterrand, is presently President Nicolas Sarkozy's culture minister. The latter's son, Jean Sarkozy, was elected as a city councilor at the tender age of 22. France's hard-right National Front illustrated just how much it had become a regular part of France's political landscape when its leadership passed from Jean-Marie Le Pen to his daughter Marine Le Pen (whose first two husbands, incidentally, were party officials) in January this year.

Ireland is a case-study in its own right. Literally dozens of family members -- sons, daughters, brothers, sisters, grandsons, granddaughters, nephews, nieces, cousins, wives, husbands, in-laws -- have followed each other into the legislature (sometimes into the same legislative seat) since Irish independence in 1922. 

In short, family ties permeate Europe's political landscape in ways that dwarf the Daleys of Chicago, the Bushes of Texas, and the Cuomos of New York.

Further compounding matters in Europe, however, is a professionalization of politics that makes the Cuomos look positively amateurish. Most European political parties with legislative representation have relatively small memberships. Nevertheless, they constitute the basis of a full-time career for many party members.

A good example is Finland's president Tarja Halonen. Her political career began at university when she served as Secretary of the National Union of Students between 1969 and 1970. The following year, Halonen joined the Social Democratic Party (which today has just 50,000 members) and worked as a lawyer for the Social Democrat-affiliated trade union movement. In 1974, she became the prime minister's parliamentary secretary. Two years later, Halonen was elected to the Helsinki city council. In 1979, she was elected to parliament, and served there for 21 years. Halonen went on to hold several ministerial posts until elected President in 2000.

In short, since her time in university, Halonen has done nothingcareer-wise except politically-related activity or holding government office. Her story, however, is quite typical.

Take today's President of the European Council, Belgium's Herman Van Rompuy. His political career began when he served as chairman of his Christian Democrat party's youth wing at the age of 26. Apart from a three year stint in the early 1970s working at Belgium's central bank and a short time in the 1980s as an academic, Rompuy has continuously held political offices before assuming his current position.

There are exceptions to this pattern (e.g., Germany's Angela Merkel). But you have to search long and hard to find them. That alone makes a mockery of the usual European happy-talk about "openness" and "diversity."

Which brings me to my last point: the diversity -- or rather the lack thereof -- when it comes to ideas among Europe's political classes.

Regardless of whether they're on the left or right, most European politicians share a broad commitment to the European social model.

Broadly-speaking, this model affirms some market institutions (such as free prices), but also heavily emphasizes major wealth-redistributions, large welfare states, and strong labor-market regulation. This is overlaid by a strong stress on top-down coordination by the government (i.e., professional politicians).

The problems proceeding from this mixture -- out-of-control spending, disincentives to be entrepreneurial, soft corruption, excessively large public-sectors -- have been understood since the word "Eurosclerosis" became commonplace in the 1970s. So why, even now, are Europe's politicians so slow to react accordingly by aggressively addressing the causes of sclerosis?

One reason is that market-liberalization would mean lessening theirimportance in the economy. Less top-down coordination means fewer top-down coordinators.

But another cause of reform-failure is that most European politicians have little-to-no experience of life in the business world.

Five years ago, a survey of the French Senate revealed that a mere 30 of its 331 members had ever worked in the private sector. Not surprisingly, they turned out to know little about hum-drum matters such as how to meet a payroll, why heavy labor market regulation makes you reluctant to hire people, or how high taxes dampens your entrepreneurial enthusiasms.

Hence, no-one should be surprised that so many EU politicians' response to the continent's current problems is to advocate morecentralization of economic policy and more regulation, and all in the name of more European-wide "coordination." Nothing could be more foreign to such mindsets than imagining that they and their rather sheltered outlook on life might be part of the problem.

Time, however, is against them. As Europe's crisis worsens, the ancien régime's efforts to control matters through yet more intergovernmental loans, bailouts, and accounting sleight-of-hands will continue yielding meager results. Unfortunately, like the Bourbons, most of Europe's political class have learnt nothing and forgotten nothing. And, as in the past, it will be ordinary Europeans rather than their political masters who pay the price.

This article originally appeared in the American Spectator.