Europe in Crisis: What Lessons to Learn?

Nothing feeds jolly bankers and dyspeptic pundits more than a tasty crisis, and this year's turmoil over the Euro has provided an especially rich diet to critics of state-owned enterprises and public sector social programs. "What we're seeing in Greece is the death spiral of the welfare state," wrote the columnist Robert J. Samuelson. "Virtually every advanced nation, including the United States, faces the same prospect. Aging populations have been promised huge health and retirement benefits, which countries haven't fully covered with taxes. The reckoning has arrived in Greece, but it awaits most wealthy societies." Harvard economist Jeffrey A. Miron honed the knife even sharper. "Tax increases will not fix things," he wrote. "Only major cutbacks in entitlements can avoid fiscal collapse."