Conservatives have finally figured out their critique of president Obama's agenda: he wants to make us French. The columnist Charles Krauthammer recently called the president's address to a joint session of Congress last month "the boldest social democratic manifesto ever issued by a U.S. president." Newt Gingrich claims that Obama wants to bring us "European socialism."
"Socialism" is a scare word in our political culture and a poor description both of modern-day Sweden and whatever Obama has in mind. But the case that the United States is moving away from market capitalism, and toward a European-style social compact in which the state has a much broader role, is not absurd. ("We Are All Socialists Now," NEWSWEEK recently proclaimed on its cover.) The Obama administration is responding to the financial crisis by nationalizing financial institutions, subsidizing failing sectors of the economy and, while it's at it, regulating industry to fight climate change. It views greater social equality as an explicit goal. If Obama succeeds in turning health insurance and funding for college into universal entitlements, he will have expanded Washington's obligations on the scale of an LBJ or an FDR. This year, government spending at all levels will jump to 40 percent of GDP. Obama's proposals could bring that figure even closer to the European Union average of 47 percent.
A first question to ask about this expansion is what, exactly, is so awful about European social democracy? France, Germany, the Netherlands, Belgium, Norway and Denmark are enlightened, liberal places with excellent public services and benefits—and really fast trains. Studies suggest that higher levels of social equality in these countries correlate with longer, happier lives for their citizens. By and large, the young democracies of Eastern Europe want the deal Western and Northern Europeans have, not the deal we do.
The familiar downside to the transatlantic political model is less economic flexibility and social dynamism. European nations have higher taxes, lower growth rates, more unemployment and less class mobility. Powerful trade unions, rigid bureaucracies and heavy regulation make them less conducive to entrepreneurship and slower to embrace technological change. The cradle-to-grave welfare state diminishes individual initiative and can breed a pervasive sclerosis.
Our respective social contracts each have their advantages, but are too deeply ingrained to trade places. Americans are defined by a history of immigration in pursuit of freedom and opportunity. We are more individualistic, enterprising and protective of liberties that Europeans do not expect, such as owning guns, working 70-hour weeks or appreciating nature as it goes by at 60mph on a snowmobile. Founded in rebellion against Colonial tyranny, our country is naturally suspicious of government intrusion. European systems, by comparison, grow out of a tradition of the state providing social benefits that stretches back to Bismarck. Europeans have less suspicion of officialdom, don't view the right to get rich as sacrosanct and demand stronger social safety nets.
Such deeply grounded differences explain why the European model of social democracy would be unlikely to find root here, even if the president favored it. But Obama shows every sign of instinctively resisting a paternalistic and overarching public sector as much as most Americans do. His approach to problem-solving reflects the national urge to rein in government even while one is busy expanding it.
This aversion to state control characterizes Obama's response so far to the financial crisis. When asked in an ABC interview why he hadn't nationalized the damn banks already, Obama's telling response was to talk about how our "traditions" and culture are different from Sweden's. "We want to retain a strong sense of that private capital fulfilling the core investment needs of this country," he said. Note that Obama's global-warming plan is a market-based, cap-and-trade system rather than a more straightforward carbon tax or regulatory scheme.
Even in areas where Obama seems to be moving in a more statist direction, there are crucial distinctions. Like most Americans, he believes government should guarantee health insurance. And like most Americans, he believes the system should be privately run. His college plan is for universal access to loans, not the essentially free ride that most students get in the EU. And he looks poised to pare Social Security benefits and Medicare spending, in addition to raising taxes, to constrain the overall cost of government. One way to describe Obama's program is a move toward cradle-to-grave opportunity, as opposed to the European model of cradle-to-grave security.
The indictment that Obama wants to foist foreign ways upon us echoes the claim by Roosevelt's critics that he wanted to usher in socialism under cover of the New Deal. It similarly misreads the president's substantive views, his political sophistication and what is within the realm of the possible in our country. Obama gets that we want government to fix the free market, not take its place.