What Does Obama’s European Socialism Model Look Like?


Listening to the pundits, you may hear that a fundamental difference in philosophy between McCain and Obama centers on the fabric of our society. In essence Obama and his liberal supporters like Pelosi, Frank, Reid, Dodd and Schumer prefer America to come more in line with the Western European socialist style democracies. McCain and his conservative supporters back a more traditional American Capitalist style of democracy.

Early this morning (afternoon here in West Yorkshire England) I caught a remote broadcast from Brian Wilson in Raleigh, North Carolina. Other than the fact that I am always amazed by the global access we have to information these days, I was taken by the undecided voters Brian was interviewing. They all had the same view. They are tired of the same old thing, but afraid of what change might bring.

I thought a little show and tell might be in order. First, I’ll assume that you are already familiar with the same old thing in terms of what you pay for groceries, gasoline, a car, or a house. I hope you also realize that the change Obama is talking about is not a return to the “good old days” whatever that might mean.

Here in Jolly Old England, life is good. We get cable TV, there aren’t really any shortages in the shops and stores. Anyone can own a car if they can afford one. Housing availability is much better than it was fifteen years ago. England has been living under a liberal democratic socialist party or “Labour Party” government for the past eleven years. How does that stack up to where we are in the USA?

Let’s start with housing, that’s something everyone should be aware of these days. I’ll do the currency conversion to make it easier to compare. Here, an 1800 square foot three bedroom two story house on a zero lot line clearance property would cost about $600,000. Of course that was last year, housing prices are down 40% so far this year. Add to that the difficulty getting a mortgage. In August new mortgages are down, 95% less than the previous month. The council taxes on that property (similar to property taxes in the U.S.) are about $4000 a year. Electricity and natural gas bills are about $400 a month. Water is about $50 a month and a plain old telephone line is $70 per month with no long distance.

Moving out to the garage, a Toyota Prius brand new would set you back about $50,000. You’d want one of these because gasoline is going to cost in the neighborhood of $8-$9 a gallon. The good news if you live in larger towns, is that you can catch the bus or train. The service and ridership of both have dropped considerably as well as service has been reduced in the eleven years since Labour came to the government.

Make a trip to the grocery store, you’re going to have sticker shock. The easiest way to explain it is that for every dollar it costs in the USA it will cost nearly a pound sterling here. The exchange rate today is about 1.75 dollars per pound sterling. If you go to a store and buy anything like clothing or appliances you will pay a national sales tax of an additional 17.5%, called value added tax.

When you get your paycheck you’ll be in one of two tax rates. Under about $60,000 you’re in the 22% bracket. Over that and you’re in the 40% bracket. There are some nuances in the system, but you will pay if you make above a certain very low minimum. Median equivalent disposable income in Great Britain in 2005-06 was $635 per week: half the population has higher incomes than this and half lower. This amount is considerably lower than the average (mean) income of $780 per week.

I would say this to those mechanics that Brian interviewed, if you want to glimpse the change that you are afraid of, come to Western Europe. Try to live like you live in the USA on the wages paid locally for the work you are currently doing. Realize that the financial problems you are experiencing in the USA are the same problems that are being experienced here in Europe. The governments being thrown out of power here are the liberal governments, and George Bush doesn’t serve in any of them.

I don’t believe we’ll see the “same old thing” anytime soon. I do believe that John McCain is a constant we can count on. I certainly do not believe that he is a perfect man, but then neither does he. But I believe that he will resist the liberal agenda that we are bound to be confronted with by and Democratic Congress.