Why The EU Economic Disaster Is "The Black Box" For America

Wayne Allyn Root

5/22/2012 12:01:00 AM - Wayne Allyn Root

Europe is on the verge of economic collapse. And, it matters to every American. If the EU breaks apart, your life and that of your children and grandchildren may never be the same.

When an airplane crashes and hundreds die, the first thing done is to recover the black box that holds the answers to what happened. Analyzing that disaster will help prevent a future tragedy. The financial tragedy unfolding now in the EU is America’s “Black Box.” If we learn the right lessons from the EU tragedy, we can save the U.S. economy and make life better for current and future generations of Americans.

Unfortunately, it’s too late for most EU countries. Their many years of socialist policies leave no option but an economic collapse of massive proportions. Generations of Europeans will suffer. But, it might not be too late for us if we study the black box and learn from Europe’s tragedy.

More on that later. First, let’s look at why the EU economic crisis matters to you. Some of you are saying, “I live in America. Why should I care about Greece? Why should Spain’s problems matter to me? Why should I give a damn about what happens in Italy?”

Let me tell you why what happens in Europe greatly affects every American.

Think what happens when a small business loses its biggest customer. Step one is to lay off employees. If the loss is big enough, the business can’t pay its bills. If you are an employee of one of those businesses you are now in the unemployment line. If you are an owner not only are you in the unemployment line, you are probably also in bankruptcy court losing your home and everything for which you’ve spent a lifetime working.

Well, the EU is America’s biggest trading partner. Any crisis or depression in the EU will badly hurt U.S. businesses. Jobs will be lost. Businesses will fail. Budgets will be slashed. Tax revenues will plummet. We’re staring at a huge economic haircut and headache. At best, the EU’s collapse will damper the U.S. economy. At worst, it could plunge us into another Great Depression.

That’s why you should care.

Second, Europe’s banks are much bigger than U.S. banks. Did you know that? Three times bigger. They finance trade all over the world, but more importantly they have all loaned huge amounts to these insolvent European countries with no hope of being repaid. If EU banks go under, we all have a big problem. Businesses across America will be at risk. The bank loans that businesses need to build, operate, manufacture, and hire will dry up. Trade will be disrupted across the globe. And, of course, EU consumers will dramatically slow their buying of goods and services from U.S. companies causing sales and revenues to decline, resulting in layoffs here at home.

That’s why you should care.

Third, because of all the above, politicians will argue that the EU is “too big to fail.” You (the U.S. taxpayer) will now be stuck with bailing out a continent. The EU needs trillions of dollars to survive. They will come to our Federal Reserve and the IMF (which we fund) with hands out begging for help. And, they’ll get it, because our politicians are weak and panicked.

Since America is already broke, owing over $100 Trillion in debt and unfunded liabilities, the Fed will have to print more fake money, stoking inflation and stealing every American’s hard earned savings by making our dollars worth less. Think about this. The trillions in bailouts required to save the EU will be on our books for decades to come. Fifty years from now, your grandchildren and mine will be paying much higher tax rates and living a much lower quality of life in order to pay the interest on these EU bailout loans. This is the ultimate redistribution of wealth with America bailing out sixty years of failed European socialist policies.

That’s why you should care.

Now, here’s why you should care about the infamous black box. The EU economic collapse is the biggest economics lesson in U.S. history. We must learn from the EU’s disaster, or face one of our own in a few short years (sooner if Obama is re-elected).

The EU is a financial train wreck because of the exact agenda Barack Obama is trying to stuff down America’s throat. Does the EU economic plan sound familiar? It’s built around big government, big spending, big taxes, big entitlements, big unions, big pensions, far too many people working for government, free healthcare, billions wasted on green energy, and, don’t forget, billions more on high speed rail. If this all sounds like an Obama/Harry Reid/Nancy Pelosi speech, it’s because it is!

The lesson from the EU black box is that when it comes to the size, scope and power of government, bigger isn’t always better. The golden lining in this entire mess is that we now have a model to save America… If we study that black box and learn from their mistakes.

The lesson is simple. Do the exact opposite of everything the EU has done for the past half century…

And send Obama and his European-style socialist cabal to the unemployment line this November.