Thursday, June 30, 2011

USA today editorial: What the US congress can learn from Greek parliament

June 29, 2011

Greece has never been a shining example of how to run a government or grow an economy. It is plagued by massive debt, an oversized public sector, rampant tax evasion and a host of byzantine anti-business laws.

So why is it that this economic basket case is suddenly showing more courage and fiscal discipline than the United States?

In a bid to stave off a default that could bring down European banks and start a disastrous run on U.S. money-market funds, the Greek parliament on Wednesday approved an austerity plan that includes tax hikes, sharp cuts in spending and the sale of tens of billions of dollars of government-owned assets. All this came despite the plan's deep unpopularity with Greeks (many of whom were on the streets rioting) from a left-wing majority that wasn't responsible for the binge borrowing in the first place.

If only American leaders would show similar spine.

Like a number of countries, the U.S. is nearing a point where its debt will get out of control. And like Greece, the U.S. government could default on its loans in a matter of weeks. Only in America's case it would be a default of choice, precipitated by Congress' failure to hike the debt ceiling and reach a deficit-reduction deal before the Aug. 2 deadline.

Some of the problem is that members of both parties, but particularly Democrats, are loath to admit that the great bulk of America's long-term debt problems are in popular benefit programs such as Medicare and Social Security.

But the immediate impasse is brought on by Republicans' refusal to consider revenue increases, or even curbs in tax breaks for wealthy corporations and individuals, as a relatively small part of the debt deal. As President Obama put it Wednesday at his news conference, his daughters show more maturity getting their homework done on time than lawmakers are displaying at the budget talks.

We never thought we'd say this, but Congress could learn something from the Greek parliament about making unpopular decisions. Granted, the Greeks were forced to act as the price for a bailout, but they did so in time to avoid calamity. Whether Congress can muster equal courage remains to be seen.

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