75-03-B6
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Crisis of Democracy
TranscriptIs the present economic and political disarray in Western Europe a passing phase or a crisis of democracy? I'll be right back. In the past year, every European country in the North Atlantic Treaty Organization experienced a change in its head of government. So did every nation in the European Economic Community, the Common Market. One chief of government was assassinated, another was exiled, a third is under house arrest. In democratic countries new leaders either won office by razor thin margins, are governing by the skin of their teeth or are little more than caretakers presiding over shifting unstable coalitions. That's not all. NATO neighbors Greece and Turkey barely avoided a war. As a result of their conflict over Cyprus, Greece has withdrawn its military forces from NATO and nearly 200,000 Greek Cypriots are homeless. In Italy, talk of a military takeover increases the non-communist politicians fail again and again to compose their differences and govern effectively. France comes within a single percentage point of electing a communist-backed president. The chancellor of West Germany is forced to resign when a communist spy is discovered in his personal entourage. And in traditionally stable Great Britain, talk of anarchy increases as a few gargantuan trade unions increase their grip on the life of the nation. Simultaneous to these political shocks and closely related to many of them, Europe has been undergoing its most severe economic slump since the continent was war ravaged in the 1940s. Every country is undergoing double-digit inflation with the exception of West Germany. While quadruple oil prices have hit Europe especially hard, few economies are expanding and Britain and Italy appear, well, not far from economic collapse. Contrast Britain and Italy, whose economic and political troubles so typify Western Europe's condition, with the Federal Republic of Germany, one country which is in relatively good shape. For years Britain and Italy have had elected governments which bordered on impotence in comparison, with huge and steadily growing bureaucracies where real power lies. These bureaucracies have had one steady characteristic, an increase in their own power accompanied by contempt for private industry and producing taxpayers. Tax rates are confiscatory, incentives are limited, much of industry is nationalized and inflation is out of control. Both Britain and Italy are near bankruptcy. By contrast West Germany is a place where the private sector is encouraged, taxation and regulation of business are at far lower levels than in the United States. In recent years the government, though controlled by the Social Democrats, has adopted austerity budgets and in 1974 did not permit the money supply to grow at all. The West German leaders have not forgotten how to say no. Perhaps German policymakers remember the colossal inflation of the 1920s and the moral degradation of Nazism to which it led a decade later. Whatever the reason, Europeans can still look to West Germany to see how to preserve a stable democracy in politically and economically troubled times. The United States might take a closer look too. This is Ronald Reagan. Thanks for listening. |
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