How Europe's Austerity Backlash Might Change U.S. Politics

Hardly any of them drive cars from Detroit but the U.S. Congress is hardly a bastion of Europhiles—remember all that b.s. about “Freedom Fries”?  Businessweek writes: When politicians here do cite the Continent, it tends to be in the form of a derogatory political attack, e.g., Mitt Romney’s frequently invoked line about how President Obama wants to “Europeanize” America.  So the idea that U.S. lawmakers might learn something from their foreign counterparts and adjust their views accordingly after the anti-austerity wave sweeping through France and Greece isn’t necessarily an obvious one. After all, Republicans point to Greece as an example of what will happen if the U.S. doesn’t rein in its debt.

Nevertheless, at least some experts believe that Europe’s plight will make austerity measures less likely in the U.S. After all, austerity’s effect this week on the careers of prominent Greek and French politicians—namely, ending them—certainly might alter a lawmaker’s views toward the necessity of deep budget cuts. A new research note from investment bank Keefe, Bruyette & Woods (KBW) makes this case. “In our view, these elections will ultimately diminish the chances that the U.S. adopts austere fiscal policies,” writes the bank’s senior vice president of Washington research….

Read all about it at http://www.businessweek.com/articles/2012-05-08/how-europes-austerity-backlash-might-change-u-dot-s-dot-politics