By
Monty Pelerin, posted April 10th, 2010 http://www.economicnoise.com/2010/04/10/we-are-closer-to-the-end/
The developed economies are in terrible shape. Western democracies are all insolvent as a result of runaway welfare spending and commitments that are destroying their economies.
The sclerotic economic performance in Western Europe has been apparent for decades. Less known is what has been happening in the US. Economic growth, wages, employment ratios and standards of living (except for the debt explosion) have been declining since the late 1970s.
It is impossible for any welfare state to survive without defaulting on many of its obligations and promises. I have a post out to another website, waiting for them to publish it. It deals with this topic and will be available here in about a week.
Europe is starting to crack with Greece in crisis. The other PIGS will soon follow. What you are witnessing is merely an “extend and pretend” strategy. No cures or corrections are being made. All that is aimed at is deferring the crisis. It may buy some more time, but it cannot solve the underlying problem of insolvency amongst western Democratic states.
Anyone foolish enough to believe the government propaganda that the recession is over and we are coming out of this is in for a rude, and presumably financially devastating, awakening. The fraud and corruption that has been covered up is slowly oozing to the surface. The US banking system is in shambles. It is only a matter of time before it implodes.
Commitments made by the US government, especially with respect to social welfare promises, will not be met. The commitment to a huge, new entitlement (Obamacare) was heroic, unwise and suicidal. It is impossible to save Social Security, Medicare and Medicaid in their current form. Adding Obamacare to the mix is the height of irresponsible government.