From the Times of London, May 6, 2010:

Unlovely as they are, the Greek rioters are the logical end point of the advanced social democratic state: not an oppressed underclass, but a spoiled overclass, rioting in defense of its privileges and insisting on more subsidy, more benefits, more featherbedding, more government.

Who will pay for it? Not my problem, say the rioters. Maybe those dead bank clerks’ clients will—assuming we didn’t burn them to death, too.

America and Greece are at different stops on the same one-way street, all too familiar to us immigrants. There’s nothing new about Obama: been there, done that. Nothing could be less hopeful, or less of a change. He’s the land where we grew up, with its union bullies and marginal tax rates and government automobiles and general air of decay all re-emerging Brigadoon-like from the mists entirely unspoilt by progress. It’s like docking at Ellis Island in 1883, coming down the gangplank, and finding everyone excited about this pilot program they’ve introduced called “serfdom.”

Greece is at the point in the plot where the canoe is about to plunge over the falls. America is upstream and can still pull for shore, but has decided instead that what it needs to do is not just drift along with the general current but paddle as fast as it can to catch up with the Greeks. Chapter One (the introduction of unsustainable entitlements) leads eventually to Chapter Twenty (total societal meltdown); the Greeks are at Chapter Seventeen or Eighteen.

The problem facing advanced societies isn’t very difficult to figure out: the twentieth-century welfare state has run out of people to stick it to. When you’re spending four trillion dollars but only raising two trillion in revenue (the Democrat model), you’ve no intention of paying it off, and the rest of the world knows it. In Greece, the arithmetic is even starker, because they’re at the next stage of social-democratic ruin. If America’s problem is that it’s spent tomorrow today, and can never earn enough tomorrow to pay for what we’ve already burned through, nations such as Greece have a more basic problem: they’ve spent tomorrow today, and there isn’t going to be a tomorrow. To prop up unsustainable welfare states, most of the western world isn’t “printing money” but instead printing credit cards and preapproving our unborn grandchildren. That would be a dodgy proposition at the best of times. But in the Mediterranean those grandchildren are never going to be born. That’s the difference: in America, the improvident, insatiable boobs in Washington, Sacramento, Albany, and elsewhere are screwing over our kids and grandkids. In Europe, there are no kids or grandkids to screw over. In the end the entitlement state disincentives everything from wealth creation to self-reliance to the survival instinct, as represented by the fertility rate. If the problem with socialism, as Mrs. Thatcher famously said, is that eventually you run out of other people’s money,³ the problem with Greece and much of Europe is that they’ve advanced to the next stage: they’ve run out of other people, period. All the downturn has done is brought forward by a couple decades the West’s date with demographic destiny.

The United States has a fertility rate of around 2.1—or just over two kids per couple.⁴ Greece, as I pointed out in America Alone, has one of the lowest fertility rates on the planet—1.3 children per couple, which places it in the “lowest-low” demographic category from which no society has recovered and, according to the UN, 178th out of 195 countries. In practical terms, it means 100 grandparents have 42 grandkids—in other words, the family tree is upside down.

Hooray, say the liberal progressives. No more overpopulation!

Here’s the problem: Greek public sector employees are entitled not only to fourteen monthly paychecks per annum during their “working” lives, but also fourteen monthly retirement checks per annum till death. Who’s going to be around to pay for that?

So you can’t borrow against the future because, in the crudest sense, you don’t have one. Greeks in the public sector retire at fifty-eight, which sounds great. But, when ten grandparents have four grandchildren, who pays for you to spend the last third of your adult life loafing around?

Welcome to My Big Fat Greek Funeral.

We hard-hearted, small-government guys are often damned as selfish types who care nothing for the general welfare. But, as the protests in Greece, France, Britain, and beyond make plain, nothing makes an individual more selfish than the generous collectivism of big government: give a chap government health care, government-paid vacation, government-funded early retirement, and all the other benefits, and the last thing he’ll care about is what it means for society as a whole. People’s sense of entitlement endures long after the entitlement has ceased to make sense. And, if it bankrupts the entire state a generation from now, so what? In his pithiest maxim, John Maynard Keynes, the most influential economist of the twentieth-century social-democratic state and the patron saint of “stimulus,” offered a characteristically offhand dismissal of any obligation to the future: “In the long run we are all dead.”⁵ The Greeks are Keynesians to a man: the mob is rioting for the right to carry on suspending reality until they’re all dead. After that, who cares?

You don’t have to go to Greece to experience Greek-style retirement. The Athenian “public service” of California has been metaphorically face down in the ouzo for a generation. As Arnold Schwarzenegger, the terminally terminated Terminator, told the legislature in his fourth State of the State address, “California has the ideas of Athens and the power of Sparta.”⁶ That’s half-right: California has the ideas of Athens. Unfortunately, it’s late twentieth-century Athens. As for “the power of Sparta,” unless he’s referring to gay marriage, it’s hard to see what he’s on about.

Greek public servants have their nose to the grindstone 24/7. They work twenty-four hours a week for seven months of the year. It’s not just that every year you receive fourteen monthly payments, but that you only do about thirty weeks’ work for it. For many public-sector “workers,” the work day ends at 2.30 p.m. Gosh, when you retire on your fourteen monthly pension payments, you scarcely notice the difference, except for a few freedup mornings. Couldn’t happen in America, right?

In Bell, California, an impoverished dump on the edge of Los Angeles whose citizens have a per capita annual income of $24,800, the city manager was paid $787,637. With benefits, Robert Rizzo’s compensation came to $1.5 million per annum. I use the phrase “per annum” loosely, since among the other gratifying aspects of his “job” was twenty-eight weeks off for vacation and sick leave. So in practical terms it worked out to $1.5 million per five and a half months .⁷

What kind of “city management” did Bell get in return for remunerating their city manager so handsomely? By 2008, Mr. Rizzo’s regime had piled up nearly $80 million of debt on its 38,000 residents.⁸ You do the math: clearly it would be unreasonable to expect Manager Rizzo to—or the bluechip insurers, bondholders, and guarantors (Citigroup, Wedbush Morgan) who continued to facilitate Rizzo’s “city management” in defiance of its arithmetical implausibility.⁹ U.S. municipal government is the subprime mortgage of big collective borrowing: Citigroup and the other bigshots wouldn’t have dealt with you on this basis, but they took the then reasonable view that even deranged spendthrift government doesn’t default, because there’s always someone it can pass the buck to. To modify Lord Acton, for Bell’s underwriters coziness with power corrupts very cozily.

Ask not for whom Bell tolls, it tolls for thee. As for murderous civil servants, you don’t have to go to Athens for that. In the New York Christmas snowstorm of 2010, the casualties of the city government’s incompetence went beyond the abandoned hot dog carts and buses and ambulances wedged into the snow banks of midtown Manhattan. A young woman gave birth in the lobby of a Brooklyn apartment house, but the baby died, because, in one of the most densely populated cities on earth, “first responders” were unable to get to her through the unploughed streets of Crown Heights until ten hours after her 911 call.¹⁰ In Queens, Yvonne Freeman, seventy-five, woke up with breathing difficulties, but she too died because the ambulance took hours to reach her.¹¹ As the can’t-do buffoon mayor floundered from one disastrous press conference to another, it emerged that the city might have been afflicted not merely by the weather but by something close to the municipal equivalent of treason. A councilman claimed that, when the storm began, Sanitation Department bosses instructed their plough drivers to delay snow clearance in New York’s outer boroughs in order to protest some planned (and fairly desultory) budget cuts.¹² The streets of Crown Heights weren’t unploughed because they were meteorologically stricken but as a conscious act of sabotage by public “servants.” That would make Mrs. Freeman, the Brooklyn baby, and others, victims of unionized manslaughter. As their Athenian comrades did, the public servants of New York prevented emergency crews from reaching those in peril, with fatal consequences. On the other hand, they did manage to clear the snow from outside the Staten Island home of Sanitation Department head honcho John Doherty, while leaving all surrounding streets pristinely clogged.¹³

Public-sector shakedown states are always unsustainable, but, though easy to launch, they’re hard to reel back. In 2010 the media reported the largest demonstration in a quarter-century had taken to the streets outside the Capitol in Springfield, Illinois, to demand, “Raise my taxes!”¹⁴ If you caught it with half an ear on the radio news, the gist seemed to be that these people were responsible and communitarian.

“Yes, people are hurting. That’s why we need a tax increase,” insisted Henry Bayer.

Who’s he? Well, he’s executive director of Council 31 of the American Federation of State, County, and Municipal Employees. Ah, right. So it’s not butchers, bakers, and candlestick makers chanting, “Raise my taxes!” It’s government workers.

Who live off taxes.

Taxes pay their salaries, benefits, and pensions. Government levies taxes on you and gives it to them. So Mr. Bayer and his chums might as well be yelling, “Gimme your money!” It’s no more communitarian than me standing in the street chanting, “Buy my book!”

Big unions fund Big Government. The union slices off 2 percent of the workers’ pay and sluices it to the Democratic party, which uses it to grow government, which also grows unions, which thereby grows the number of 2 percent contributions, which thereby grows the Democratic party, which thereby grows government.... Repeat until bankruptcy. Or bailout.

The “Raise my taxes!” protest was a subtler version of the Athenian riots—or a Trojan horse full of unionized Greeks. If the new class war is between “public servants” and the rest of us, some countries no longer have enough of “the rest of us” even to put up a fight. When the “public service” becomes as dominant as Greece’s, it is the market: you can’t cut back public spending without moving toward economic crisis and social catastrophe. The bloated public service leached so much out of the Greek economy that the European Union decided that the least worst response was to allow them to do the same to the broader EU economy—just as the debauched public sector of California is pinning its hopes on federal largesse.

Greece is a great civilization, or it was. Now it’s a basket case. They set up a caring, compassionate, progressive society, and it’s bankrupted them. In Greece, a female working in a “hazardous” job can retire with a full government pension at fifty. Initially, “hazardous” meant jobs like bomb disposal and mining. Ever fancied a career in bomb disposal? No? Don’t blame you, it’s kinda hazardous.

But, as is the way of government entitlements, the “hazardous” category growed like Topsy. Five hundred and eighty professions now qualify as “hazardous,” among them hairdressing.¹⁵ “I use a hundred different chemicals every day—dyes, ammonia, you name it,” 28-year-old Vasia Veremi told the New York Times. “You think there’s no risk in that?” Not to mention all those scissors.

Like hairdressers, Greek TV and radio hosts can also retire at fifty—because of their high level of exposure to “microphone bacteria.”¹⁶ Were you inspired to buy this book by seeing me yakking into a mike about it up on the podium at a stop on the publicity tour? Well, that very microphone counts as a hazardous work environment in Greece. What a class action we authors will have! These publishing houses are like the tobacco companies: when they booked me and J. K. Rowling and the guy who does those Chicken Soup things and the rest of us on a coast-to-coast media blitz, they knew all about the risks of microphone bacteria, but they went ahead and ruined our life expectancy anyway.

It all sounds great. Who wouldn’t want to be a Greek hairdresser? Alas, being a Greek, period, is now a hazardous profession. An Obamafied America, following California down the Athenian path, is Greecing its own skids.

The EU is now throwing an extra trillion dollars at countries which by any objective measure are insolvent, and are unlikely ever again to be anything but—at least this side of bloody revolution. How do you grow your economy in an ever shrinking market? Greece is a land of ever fewer customers and fewer workers but ever more retirees and more government. How do you increase GDP? By export? To where? You’re entirely uncompetitive; you can’t make anything at a price any foreigner would be prepared to pay for it.

When you binge-spend at the Greek level in a democratic state, there aren’t many easy roads back. The government introduced an austerity package to rein in spending.¹⁷ In response, Greek tax collectors walked off the job. Read that again slowly: to protest government cuts, striking tax collectors refuse to collect taxes. In a sane world, this would be an hilarious TV comedy sketch. But most of the western world is no longer sane. It’s tough enough to persuade the town drunk to sober up, but when everyone’s face down in the moonshine, maybe it’s best just to head for the hills—if you can find anywhere to flee.

Let us take it as read that Greece is an outlier. As waggish officials in Brussels and Strasbourg will tell you, it only snuck into the EU due to some sort of clerical error. It’s a cesspit of sloth and corruption even by Mediterranean standards. If you were going to cut one “advanced” social democracy loose and watch it plunge into the abyss pour encourager les autres, it would be hard to devise a better candidate than Greece. And yet and yet . . . riotwracked Athens isn’t that much of an outlier. Greece’s 2010 budget deficit was 12.2 percent of GDP;¹⁸ Ireland’s was 14.7.¹⁹ Greece’s debt was 125 percent of GDP;²⁰ Italy’s 117 percent. Greece’s 65-plus population will increase from 18 percent in 2005 to 25 percent in 2030;²¹ Spain’s will increase from 17 percent to 25 percent.

Some of the oldest nations in the world are now in the situation of a homeowner who’s fallen too far behind on the payments and has no prospect of catching up: you might as well just put the door keys in an envelope, shove ’em under the door of the bank, and move on—perhaps to an uninhabited atoll in the South Pacific as yet unspoilt by unsustainable levels of government. At some point, the least worst option becomes armed revolution, civil war, or at least an electro-magnetic pulse attack that conveniently obliterates every single bank account and wipes the slate clean. As lazy, feckless, squalid, corrupt, and vicious as Greece undoubtedly is, it’s not that untypical. It’s where the rest of Europe’s headed—and Japan and North America shortly thereafter.

Greece is broke, and has run out of Greeks. So it’s getting bailed out by Germany. But Germany also has deathbed demographics: as Angela Merkel, the Chancellor, pointed out in 2009, for Germany an Obama-sized stimulus was out of the question simply because its foreign creditors know there are not enough young Germans around ever to repay it.²² Germany has the highest proportion of childless women in Europe: one in three fräulein have checked out of the motherhood business entirely.²³

Absolved from having to pay for their own defense, Continentals beat their swords into welfare checks, and erected huge cradle-to-grave entitlements. Even under the U.S. security umbrella, they proved unsustainable. Why? Well, like Keynes said, in the long run we are all dead—so why not bilk the future? We won’t be here, and our creditors won’t have a forwarding address. No one has engaged in transgenerational theft on the scale that Europe has.

And these days Germany has to support a continent. It’s the economic powerhouse that’s supposed to be rescuing the euro and preventing the five soi-disant PIIGS (Portugal, Italy, Ireland, Greece, Spain) from having the Big Bad Wolf of reality blow their house of straw to smithereens. But what happens when your engine room is rusting? “Germany’s workingage population is likely to decrease 30 percent over the next few decades,” says Steffen Kröhnert of the Berlin Institute for Population Development. “Rural areas will see a massive population decline and some villages will simply disappear—Germany will become a weak economic power in the future.”²⁴

The EU committed (to borrow from Philip K. Dick) a kind of precrime: it mugged the next generation. For the moment, the victims are still walking around, mostly unaware of what they’re in for. For many of them, life is good. Take Marina Casagrande of Bergamo.²⁵ In Italy, a court ordered her father to pay Marina an allowance of 350 euros—approximately $525—every month. Signor Casagrande was then sixty. His daughter was thirtytwo. She was supposed to have graduated with a degree in philosophy eight years earlier but, though her classes ended way back at the beginning of the century, she was still working on her thesis. So Signor Casagrande is obliged to pay up, either in perpetuity or until the completion of Marina’s thesis, whichever comes sooner. Her thesis is about the Holy Grail. Which Marina would have little use for, given that she’s already found a source of miraculous life-transforming powers in Papa’s checkbook.

Marina is what they call a “bambocciona,” which translates, roughly, as “big baby”—the term for the ever-growing number of Italian adults still living at home, in the same bedroom they’ve slept in since they were in diapers. There was, as usual, a momentary spasm of ineffectual outrage over the judge’s decision against Signor Casagrande, whose very name is mocked by this demographic trend: the casa would seem much more grande if only Junior would move out. But in Italy they rarely do: seven out of ten adults aged 18 to 39 live with their folks.²⁶ Sixtysomething Italians ordered to pay “child support” to thirtysomething kids might consider moving back in with their nonagenarian parents and suing for a monthly allowance backdated to the early Seventies.

Italy’s bamboccioni have their equivalents around the world. In Japan, they’re called parasaito shinguru—or “parasite singles,” after the horror film Parasite Eve, in which alien spawn grow in human bellies feeding off the host. In Germany, they’re Nesthockers with no plans to move out of “Hotel Mama.” In Britain, they’re KIPPERS (Kids In Parents’ Pockets Eroding Retirement Savings). In Canada, by 2006, 31 percent of men aged 25 to 29 were still sleeping in their childhood bedroom each night.²⁷

The economics of demographics used to be relatively simple: in a traditional agricultural society, by the time you got too worn and stooped for clearing and plowing, you hoped to have sired able-bodied 13-year-olds to do it for you. Today, most developed nations have managed to defer adulthood and thus to disincentivize parenthood—quite dramatically so, if the judgment against Signor Casagrande holds. Why blame his daughter? No matter how long you stay in school in Italy, there’s nothing waiting for you when you come out. Francesca Esposito was twenty-nine, spoke five languages, had two degrees, and could land no job other than an unpaid traineeship with a government agency facilitating millions of euros’ worth of false disability claims.²⁸ “I have every possible certificate,” she told the New York Times, which, in its poignant profile of Italy’s young, never seemed to consider whether such expensively acquired “certification” is necessary for a government job—or most others. Young(ish) Francesca had a law degree from Italy, a master’s from Germany, and had interned in Luxembourg at the European Court of Justice. A century ago, this leisurely, indulgent saunter through a tri-national varsity would have been the province of bored aristocratic scions with no interest in politics or soldiery, but somehow Europe got the idea to universalize it. Miss Esposito’s father is a fireman, her mother a high school teacher. She is the first in her family to learn a foreign language and graduate from college.

And she may well be the last. There is absolutely no return on investment, either for her or the Italian taxpayers who funded it. How could there be? A world in which you’re expensively educated till thirty to join a government agency justifying its own expansion by manufacturing welfare fraud is almost too perfect an emblem of the European Union. Francesca will live a worse life than her parents. She will do unpaid traineeships and low-paid short-term contract work because in Europe’s catatonic labor market the young (if one calls twenty-nine “young”) are already paying the price for the lavish salaries and benefits awarded to the unsackable middle-aged. Hence, bamboccioni , Nesthockers, and KIPPERS. There used to be an English expression, “kippers and curtains.” In Europe today, it’s KIPPERS—and curtains. “Hope’n’ change”? To be young in the EU is to live in a land beyond hope.

Debt operates on certain assumptions: if you need $500 and you don’t have it, the bank will lend it to you because they think you’re likely to have 500 bucks in the near future. The older you get, the less likely the bank will assume that. If you’re seventeen and broke, it’s because you haven’t yet got your first foot on the ladder of success. But if you’re sixty-three or seventyeight and you’re broke, it’s because that’s who you are and you’re never not going to be broke. So why should the bank lend you 500 bucks? Where’s it going to come from?

That’s the question the developed world is facing: Where’s it going to come from? A new tax? There’s nothing left to tax. By 2009, Europe was reduced to considering a levy on bovine flatulence.²⁹ You heard that right—not a flat tax but a flatulence tax. Ireland was pondering a tax of 13 euros per cow, while in Denmark it was as high as 80 euros per cow. Is a Danish Holstein six times as flatulent as an Irish Hereford? Beats me. But somewhere in Brussels there’s a Director of the European Flatulence Agency of Regulation and Taxation (EuroFart) who’s got all the graphs. Apparently it’s to offset looming penalties each nation faces from EU legislation to combat “global warming.” The Times of London reported: “EU member states are obliged to cut the emissions from non-ETS sectors by 10 percent overall by 2020. While Romania and Bulgaria will be allowed to increase emissions, Ireland and Denmark are each faced with cuts of 20 percent in farming sector emissions.”³⁰

Even allowing for the regulatory yoke Europe’s cowed citizenry labor under, the bureaucratic logic here is hard to follow. Why is some Bulgar’s Holstein allowed to increase his flatulence while the poor Jutlander’s Polled Hereford has to put a stopper in it? Is there a dearth of flatulence in the Balkans but a Code Red alert over the North Sea? Couldn’t the EU introduce flatulence offsets and let the excessively flatulent Irish trade some of their flatulence to the Carpathians?

Go back to medieval times. The gnarled old peasant is in his hovel, and one day a fellow rides up in the full doublet and hose and says he’s come from the palace to collect His Majesty’s bovine flatulence tax. It’s just three groats per cow, a footling sum of no consequence. Even the medieval simpleton rustic would say, “Aaargh, sire, I dunno. The King’s flatulence tax? That don’t sound right....” When you’re taxing bovine flatulence emissions, there’s nothing left to tax.

Greece, wrote Theodore Dalrymple, is “a cradle not only of democracy but of democratic corruption”³¹—of electorates who give their votes to leaders who bribe them with baubles purchased by borrowing against a future that can never pay it off. The advanced democracies with their mountains of sovereign debt are the equivalent of old people who’ve blown through their capital and are all out of ideas looking for young people flush enough to bail them out. And the idea that it might be time for the spendthrift geezers to change their ways butts up against their indestructible moral vanity. In 2009, President Sarkozy prissily declared that the G20 summit provided “a once-in-a-lifetime opportunity to give capitalism a conscience.”³² European capitalism may have a conscience. It’s not clear it has a pulse. And, actually, when you’re burning Greek bank clerks to death in defense of your benefits, your “conscience” isn’t much in evidence, either.

This is the first crisis of globalization, and it is a far more existential threat than the Depression. In living beyond its means, its times, and its borders, the developed world has run out of places to pass the buck.

American admirers often talk about the European lifestyle. Alas, it’s all style and no life. If the EU’s deathbed demographics are becoming too obvious for even the dopier media outlets to ignore, you can bet the Chinese and other buyers of western debt are way ahead in their analyses. If you’re an investor and you’re not factoring in demography, more fool you. Tracking GDP versus median age in the world’s major economies is the easiest way to figure out where this story’s heading.

Take a “toxic asset.” What would improve its current pitiful value? That’s easy: more demand. Less supply. An asset is only an asset as long as there’s a buyer willing to buy it. If you’ve got 50 houses and 100 would-be homeowners, that’s good for property prices. If you’ve got 100 houses and 50 would-be homeowners, that’s not so rosy.

Which is the situation much of the West is facing. A bank is a kind of demographic exchange, by which old people with capital lend to young people with ambition and ideas. Who are somewhat thin on the ground in modern consumer societies. Japan, Germany, and Russia are already in net population decline.³³ Fifty percent of Japanese women born in the Seventies are childless. Between 1990 and 2000, the percentage of Spanish women childless at the age of thirty almost doubled, from just over 30 percent to just shy of 60 percent.³⁴ In Sweden, Finland, Austria, Switzerland, the Netherlands, and the United Kingdom, 20 percent of 40-year-old women are childless.³⁵ In a recent poll, invited to state the “ideal” number of children, 16.6 percent of Germans answered “None.”³⁶

Well, that’s a woman’s right to choose. But, in the macroeconomic picture, who’s going to be around to buy your assets? Mark Twain commended the purchase of land because “they’re not making any more of it.”³⁷ But, in the fast depopulating eastern half of Germany, they’ve made more than anyone’s going to need for the foreseeable future. Pace the Führer, no country has ever been less in need of lebensraum. America has a milder case of the same syndrome—the Boomers didn’t have enough kids to sustain the mid-twentieth-century entitlement regime—but EU governments are now frantically hurling natalist benefits at a shrinking base of fecund womanhood.

Now look at it from a business point of view. In the United States, depending on what line of work you’re in, your sales territory may be your town or your state or the whole of America. But for Germany, Italy, and Japan, their only viable sales territory is the world. When your median age is forty-three and rising, any economic growth is down to exports. Wall Street experts talk about restoring “consumer confidence,” but in much of Europe they won’t restore “confidence” until they restore consumers—that is, figure out a way to generate sufficient numbers of them. Until then, the domestic market is too old and too small (or “inert,” to reprise Martin Wolf ’s line) to support economic revival.

If you’re a German bank, to whom do you lend money? With age distribution on your home turf heading north relentlessly, you don’t have enough young people to grow your business. So you lend farther and farther afield. Not crazy farther, not Sudan or Rwanda. But far enough that you’re operating in markets where your traditional forms of risk analysis don’t apply, even if you were minded to apply them. To western bankers, Eastern Europe didn’t seem that different or dangerous, if you steered clear of the more psychotic oligarchs. Unfortunately, the post-Soviet east is even further down the demographic death spiral than you are. America? By some estimates, Germany’s Landesbanken could have to write off a trillion bucks’ worth of subprime crud from the U.S.

So, from the individual homeowner with no one to sell his home to, and the business that’s run out of domestic market, and the bank frantically loaning to jurisdictions it barely comprehends, nudge it up one last stage—to the state. In recessions, government is enjoined to spend—to go into deficit, ramp up the national debt in order to “stimulate” the economy. Adding to the national debt presupposes that there’ll be someone to pay it off. But what if there isn’t? And do the Chinese and the Saudis already know the answer to that question? The failures of British and German Treasury auctions (not to mention near misses in the U.S. prevented only by the Fed buying up Treasury securities) prefigure a world with too much debt and too few sugar daddies willing to cover it.

In 2003, the IMF conducted a study of Eurosclerosis and examined the impact on chronic unemployment and other woes if the Eurozone labor market were to be Americanized—increasing participation in the work force, reducing taxes, rolling back job-for-life security, and generally liberalizing the economy.³⁸ They concluded that the changes would be tough, but over the long-term beneficial.

It’s interesting that it never occurred to the IMF that anyone would be loopy enough to try their study the other way around—to examine the impact on America of Europeanization. For that, we had to wait for the election of Barack Obama. You’ve probably heard liberal academics on NPR and the like drooling about “the European model,” and carelessly assumed they were referring to Carla Bruni. If only. Under the European model, state spending accounts for roughly 50 percent of GDP.³⁹ Under the Swedish model, which isn’t half as much fun as it sounds, state spending accounts for 54 percent of GDP. In the United States, it’s already over 40 percent. Ten years ago, it was 34 percent. So we’re trending very Swede-like. And why stop there? In Wales, government spending accounts for just under 72 percent of the economy.⁴⁰ Fortunately for what’s left of America’s private sector, “the Welsh model” doesn’t have quite the same beguiling ring as “the Swedish model.” But, even so, if Scandinavia really is the natural condition of an advanced democracy, then we’re all doomed.

That was the general thesis of America Alone—that the jig is up for much if not most of the western world. “Alarmist,” pronounced The Economist ,⁴¹ reflecting the general consensus of polite society in both Europe and North America. Polite society has spent the years since playing catch-up. So if you don’t want your fin de civilisation analysis from a frothing right-wing loon you can now get it from the house-trained chaps at the New York Times: “Europeans have boasted about their social model, with its generous vacations and early retirements, its national health care systems and extensive welfare benefits, contrasting it with the comparative harshness of American capitalism . . .‘The Europe that protects’ is a slogan of the European Union.”⁴²

Protects from what? Right now, Europe mostly needs protection from itself and its worst inclinations: “With low growth, low birth rates and longer life expectancies, Europe can no longer afford its comfortable lifestyle.”

Even in its heyday—the Sixties and Seventies—the good times in Europe were underwritten by the American security guarantee: the only reason why France could get away with being France, Belgium with being Belgium, Sweden with being Sweden is because America was America. For over sixty years America has paid for Europe’s defense. And because the United States Army lives in Germany, that frees up Germany to spend its defense budget on government health care and all the rest. In essence, American taxpayers pay for German entitlements.

And it still isn’t enough.

So the world has deemed Greece “too big to fail,” even though in (what’s the word?) reality it’s too big not to fail. And the rest of us are too big not to follow in its path: “Another reform high on the list is removing the state from the marketplace in crucial sectors like health care, transportation and energy and allowing private investment,” reported the New York Times. “Economists say that the liberalization of trucking routes—where a trucking license can cost up to $90,000—and the health care industry would help bring down prices in these areas, which are among the highest in Europe.”⁴³

Removing the state from health care brings down prices? Who knew? This New York Times is presumably unrelated to the New York Times that spent the previous year arguing for the U.S. government’s annexation of health care as a means of controlling costs. And entirely unrelated to the New York Times whose Nobel Prize-winning economics guru, Paul Krugman, pronounced Europe “the Comeback Continent” in 2008.⁴⁴

About half the global economy is living beyond not only its means but its diminished number of children’s means. Instead of addressing that fact, countries with government debt of 125 percent of GDP are being “rescued” by countries with government debt of 80 percent of GDP. Good luck with that.

The day after the 2010 election, I found myself sharing a stage with Howard Dean, former Governor of Vermont and head of the Democratic National Committee.⁴⁵ Governor Dean mused that the European Union was one of the most interesting experiments in government ever attempted. As “interesting” as the experiment is, most Greeks, Frenchmen, and Germans were not aware that they were signing on as guinea pigs. In the post-war ruins of la gloire de la république, the French created the embryo EU to be a kind of Greater France—as a way of avoiding the truth about their own diminished status. It worked too well, and, when the EU took on many of the calcified qualities of its dominant founder, the elite thought it was time to pass the buck up yet again. The Eurocrats are now in favor of the European Unionization of the world. As Herman van Rompuy put it: “2009 is the first year of global governance.”⁴⁶

Herman van Hoozee? Well, he’s this curious Belgian bloke who, shortly before uttering the above words, emerged as the first “President” of “Europe.” Nobody elected him as President of Europe, whatever that means. One day he was an obscure Belgian. The next day he was an obscure Belgian with a business card saying “President of Europe.” Just one of those things, could happen to anyone. It’s not just that he’s hardly a household name in the average European household. It’s not clear he’s a household name even in the van Rompuy household. I don’t watch a lot of Belgian TV, so I’m not sure if they have a “Belgian Idol” or “Dancing with the Belgians” over there, but, if so, he’d be knocked out in round one. Like everything in a European Union all but entirely insulated from democratic accountability, the so-called “presidency” was a backroom stitch-up: neither the French nor the Germans wanted a charismatic glamorpuss in the gig stealing their respective thunders. An obscure Belgian was just the ticket. Being a low-grade nondescript was the minimum entry qualification.

And yet the fact remains that he is “President” of “Europe,” and in that capacity he announced that 2009 was the first year of global governance.

Incidentally, did you get that memo?

Me neither.

Still, I’m always appreciative when a fellow says what he really means. The upgrading of the G20; the plans for planetary-wide financial regulation; the Copenhagen climate-change summit and its (thankfully thwarted) proposals for a transnational bureaucracy to facilitate the multitrillion-dollar shakedown of the advanced democracies: all these are pillars of “global governance,” of the European Unionization of the world—and Copenhagen alone would have been the biggest exercise in punitive liberalism the western democracies had ever been subjected to. Right now, if you don’t like the local grade school, you move to the next town. If you’re sick of Massachusetts taxes, you move to New Hampshire. Where do you move to if you don’t like “global governance”? To what polling station do you go to vote it out?

Greece’s unsustainable spending is propped up by Germany, and Germany’s unsustainable spending is propped up by America. So who’s left to prop up America’s unsustainable spending? Yet Washington is pushing on to Europe’s future when even the Europeans are figuring you can’t make it add up.

As the fog of Obama’s rhetoric lifted and the scale of his debt mountain became clear, the president’s courtiers began to muse about the introduction of an EU-style “VAT.”⁴⁷ Americans generally translate that as a “national sales tax,” but it actually stands for “value-added tax,” because you’re taxing the value that is added to a product in the course of its path to market. Yet what Europe needs is to add “value” in a more basic sense.

There are two main objections to the wholesale Europeanization of America. The easy one is the economic argument. But the second argument is subtler: the self-extinction of Europe is not just a matter of economics. Advanced social democracies don’t need a value-added tax; they need a value-added life. “The Europe that protects” may protect you from the vicissitudes of fate but it also disconnects you from the primary impulses of life. Government security does not in and of itself make for a satisfying, purposeful life. Studies from the University of Michigan and elsewhere suggest quite the opposite—that welfare makes one unhappier than a modest income honestly earned and used to provide for one’s family.⁴⁸ “It drains too much of the life from life,” said Charles Murray in a speech in 2009. “And that statement applies as much to the lives of janitors—even more to the lives of janitors—as it does to the lives of CEOs.”⁴⁹ Capitalists sometimes carelessly give the impression that theirs is a materialistic argument. But anti-capitalists do not want for material comforts—you go to the poorest part of town and you see plenty of iPhones and plasma TVs. And Eutopia is distinguished mainly by a lethargic hedonism: shorter working hours, longer vacations, earlier retirements, bigger benefits. What do they do with all that free time? High-school soccer and 4-H at the county fair? No. As we’ve seen, kids not called Mohammed are thin on the ground. God? No. When you worship the state-as-church, you don’t need to bother showing up to Mass anymore. Civic volunteerism? No. All but extinct on the Continent. Do they paint, write, compose? Not so’s you’d notice. Never mind Bach or even Offenbach, these days the French can’t produce a Sacha Distel or the Germans a Bert Kaempfert, the boffo Teuton bandleader who somewhat improbably managed to play a critical role in the careers of the three biggest Anglophone pop acts of the twentieth century—he wrote “Strangers in the Night” for Sinatra, “Wooden Heart” for Elvis, and produced the Beatles’ first recording session. If that sounds like a “Trivial Pursuit” answer, it’s not. Eutopia turned out to be the trivial pursuit; to produce a Bert Kaempfert figure right now would be a major cultural accomplishment Europe can’t quite muster the energy for. Life is a matter of passing the time—or, indeed, of holding the moment: “Linger awhile, how fair thou art,” in the words of Goethe’s Faust, which would make a fine epitaph for the European Union.

“In the long run we are all dead”: Keynes’ flippancy disguises his radicalism. For most of human history, functioning societies honor the long run; it’s why millions of people have children, build houses, plant gardens, start businesses, make wills, put up beautiful churches in ordinary villages, fight and if necessary die for king and country.... It’s why extraordinary men create great works of art—or did in the Europe of old. A nation, a society, a community is a compact between past, present, and future, in which the citizens, in Tom Wolfe’s words, “conceive of themselves, however unconsciously, as part of a great biological stream”:

Europe is already dead—in the short run.

Linger awhile, how fair thou art. It’s nice to linger at the brasserie, have a second café au lait, and watch the world go by. At the Munich Security Conference, President Sarkozy demanded of his fellow Continentals, “Does Europe want peace, or do we want to be left in peace?”⁵¹ To pose the question is to answer it. But it only works for a generation or two, and then, as the gay bar owners are discovering in a fast Islamifying Amsterdam, reality reasserts itself.

We began this book with some thoughts from Bertie Wooster and Jonathan Swift regarding Belshazzar’s feast and “the writing on the wall.” But sometimes there’s so much writing you can barely see the wall. On my last brief visit, Athens was a visibly decrepit dump: a town with a handful of splendid ancient ruins surrounded by a multitude of hideous graffiticovered contemporary ruins. Sit at an elegant café in Florence, Barcelona, Lisbon, Brussels, almost any Continental city. If you’re an American tourist, what do you notice? Beautiful buildings, designer stores, modern bus and streetcar shelters...and all covered in graffiti from top to toe. The grander the city, the more profuse the desecration. Go to Rome, the imperial capital, the heart of Christendom: the entire city is daubed like a giant New York subway car from the Seventies. Look at your souvenir snaps: here’s me and the missus standing by the graffiti at the Trevi Fountain; there we are admiring the graffiti at the Coliseum.

A New York Times feature on Berlin graffiti reported it as an art event, a story about “an integral component of Berliner Strassenkultur.”⁵² But it’s actually a tale of civic death, of public space claimed in perpetuity by the vandals (like graffiti, another word Italy gave the world, as it were). At the sidewalk cafés, Europeans no longer notice it. But it is in a small, aesthetically painful way a surrender to barbarism—and one made even more pathetic by the cultural commentators desperate to pass it off as “art.” And it sends a signal to predators of less artistic bent: if you’re unwilling to defend the civic space from these coarse provocations, what others will you give in to?

It’s strange and unsettling to walk through cities with so much writing on the wall, and yet whose citizens see everything but. Bertie Wooster’s Aunt Dahlia is right: once upon a time, you were certainly an ass if you didn’t know where “the writing on the wall” came from. It was part of the accumulated cultural inheritance: in the old Europe, Handel and William Walton wrote oratorios about it. Rembrandt’s painting of Belshazzar’s Feast hangs in the National Gallery in a London all but oblivious to its significance. Instead of paintings and oratorios and other great art about the writing on the wall, Europeans have walls covered in writing, and pretend that it’s art. Today, I doubt one in a thousand high-school students would have a clue whence the expression derives. And one sign that the writing’s on the wall is when society no longer knows what “the writing on the wall” means.