MAKING SENSE -- July 5, 2012 at 10:00 AM EDT
Compared to Europe, Does the U.S. Really Have Its Act Together?
A euro coin rest on top of a dollar bill. Photo by: Dan Kitwood/Getty Images.
Paul Solman frequently answers questions from the NewsHour audience on business and economic news on his Making Sen$e page. Here is Thursday's query:
Question: It's often heard: "Europe ought to get its act together."
Europe: Are its conflicting sovereignties in a federation like America's in 1789? Is our act really "together" today? Where did the current financial crisis begin, in Old Europe or in our New World?
Answer: Is our act together compared to Europe's? Can there be any doubt, even with last week's seemingly successful summit in Brussels? We, the people of the United States, tax as a single nation-state, keep accounts as a nation-state, guarantee the deposits of our banks as a nation-state and most relevantly, in the current context of Euro-woes, borrow as a single nation-state.
It being a patriotic time of year, consider this excerpt from the most famous of the Federalist Papers, #10, penned by James Madison in defense of the Constitution:
A rage for paper money, for an abolition of debts, for an equal division of property, or for any other improper or wicked project, will be less apt to pervade the whole body of the Union than a particular member of it; in the same proportion as such a malady is more likely to taint a particular county or district, than an entire State.