A natural pessimist in my declining years, I none-the-less am becoming cautiously hopeful that Mitt Romney will not only seize the White House in three months, but big-spending Democrats will lose the U.S. Senate as well.
In my mind, all that can be put down as good news (OK, pre-news, errrr, just a wild guess, but it feels good.)
But now the bad news. Quite likely, the entire world economy is staring down the barrel of a catastrophic economic collapse, to be followed by as much as two decades of dreary Depression. Romney will not be able to do much about that, except maybe to trim government spending so that we ride out the storm in better shape.
Obama, of course, would use the failure of global free enterprise to install yet even more government structure to create a society totally under the control of the central government authority, which means demagogic politicians such as he. Any bourgeoisie innovator who tries to create a brand new industry or revolutionary product will find it is exceedingly difficult to do so without paying off that huge and smothering central government bureaucracy with campaign contributions to the political king-pins.
Even then, the revolutionary entrepreneur will struggle to become nearly as rich as the old rich folks who made theirs under Reagan or Bush tax policies. These old rich are the limousine liberals who have totally made their pile beyond any chance of being ruined by earned income tax rates, so they are happy to kick over the ladder of success now that they are up it. With income tax rates of 50-90% again, no one will be coming up the ladder.
Europe is already there. Europeans create almost no new businesses, not even small businesses. The European mindset is actually very conservative in an extremely cautious sense. The populace has social insurance up to their necks against any kind of hardship and European banking and business leaders hate risk themselves, just hate, hate, hate it.
Immigrants to Europe often come from cultures where very small businesses, at least, thrived. They would love to open more cafes, bakeries, shops of all types, and so on but discover that in every major nation of Europe families that control existing small businesses are grandfathered in while regulations used to control absolutely everything discourage start-ups.
And this is the core of the problem. Outside of Germany and Finland, private free market economic growth is stagnant, while government spending continues happily running up massive and unsustainable debts.
The boom and bust cycle is not so much due to governments becoming too heavy for even young giants to carry them, however, as it is to the fact that a free trade world system is rather like a runaway wild fire. When all of the dry fuel wood for one season is burned up in one glorious firestorm, it can take a decade or more of rainy growing seasons to replenish the environment.
In the meantime, nations and their socio-cultural institutions need to rediscover all the traditional social values of tediously hard work, self discipline, and cautious living. They should try not to put up institutional roadblocks that work to block boom periods from ever returning.