Podcast • June 23, 2009

Alfred Gusenbauer: Euro-Socialism in America

Maybe Newt Gingrich is right — that Americans are getting used to something like European Socialism in this Bush-to-Obama bankruptcy and bailout era. Click to listen to Chris’s conversation with Alfred Gusenbauer. (38 minutes, 17 ...

Maybe Newt Gingrich is right — that Americans are getting used to something like European Socialism in this Bush-to-Obama bankruptcy and bailout era.

Click to listen to Chris’s conversation with Alfred Gusenbauer. (38 minutes, 17 mb mp3)

Alfred Gusenbauer: desperate? serious?

Alfred Gusenbauer seems to think so. Austria’s hearty 49-year-old former chancellor, who may be typical of the left-of-center professionals in European politics, likes everything he sees on his American sojourn, starting with the Obama stimulus package, the borrowed budget, and the push for big public investments in health, education and green technology: “What the US government is doing now compared with all the others in Europe is the best one could do,” he says in conversation.

Europeans may be cushioned by a stronger social safety net, but Gusenbauer is struck by a sort of “optimism net” in America. We are blessed, at last, with “a government in which the people trust.” Habitually, perhaps, self-reliant Americans tend to look confidently to their families and their own initiatives, he remarks. Americans take six months or a year to believe that their sinking economy is in serious trouble. Europeans will take six months or a year to believe the good news, if a recovery ever comes.

Gusenberg, visiting at the Watson Insitute, leads our conversation with a quip — German Chancellor Angela Merkel‘s joke about the difference between Communism and Capitalism. “In Communism, first they are going to nationalize everything, and then destroy it. In Capitalism, it’s the other way round.”

Germans and Austrians, proverbially, take different views of a crisis like this world economic shutdown: in Berlin the situation is supposed to look “serious but not desperate;” in Vienna, rather, “desperate but not serious.” The Gusenbauer view, in our non-technical ramble, is that what’s deeply serious in the crisis is the economics of it — the stark imbalances (East and West and within every society) of production and consumption, savings and debt, health and hunger. What could be desperate is the social rancor and far-out politics fermenting even in Europe among people feeling abandoned — among workers who’ll never work again, among young people who don’t believe Europe’s “paradigm of progress,” and among politicians who will put the European project at risk to save their national bacon.

We are just at the beginning of real consequences for real people. I see two vulnerable groups: Those that are older than 50. Most of the old jobs and the old qualifications are gone. The huge danger is that people over 50 losing their jobs right now won’t be able to enter the market again… The second group is the youngsters, because with this enormous increase of unemployment that we are facing right now, all those that are leaving nowadays universities, grammar schools, technical education schemes, they will enter the labor market and find closed doors. And we cannot predict what this might mean for their social and political behavior… In Greece last year, among university students… this went quite far in terms of public violence and in terms of challenging the state authority. So nobody can predict right now which social and political effects a longer duration of the crisis might have upon different groups. This will be the real challenge for European democracy and for the European welfare state, to hold the social fabric together in times when it is fundamentally challenged…

An Austrian Socialist makes a model of development and redistribution and social justice in the near neighborhood of South-Eastern Europe — the West Balkan states of Serbia, Croatia, Slovenia, Bosnia-Herzegovina, Macedonia, Kosovo, Bulgaria and Rumania — whose GDP altogether is smaller than Austria’s today:

Within Europe, I think it’s very clear; our hope is in the East, because from there the demand will come, from there the energy will come, from there the dynamics for the future economic development will come. And we are free to decide, are we going to support such a development, with a clear redistribution of resources that we have in Europe going to the East? … Our problem is that we are losing our markets. If we are not selling cars you are going to lose your job, so we have to sell our cars. We need people that are ready to buy our cars. Where are the best, most regulated, based on rule-of-law markets in our vicinity? It’s the new member states of the European Union. And therefore I tell you, it’s much better to spend one Euro in Romania than to spend a Euro in Austria, because a Euro spent in Austria will directly go into the saving rate, not in an increase in the sales of cars.

Alfred Gusenbauer in conversation with Chris Lydon, Providence, June 11, 2009.