Obama Wants To Make America More Like Europe

Barack Obama is unhappy with much that preceded his occupation of the White House, and not only his predecessor’s foreign policy, for which he is a serial apologiser. Pre-Obama domestic policy also displeases him: any prosperity the nation enjoyed, he says, was built on a foundation of sand. That, won’t happen again: the trillions of debt he is loading on the nation’s books will enable us to erect our post-recession house on solid rock. Our world will never be the same again.

Of course, it never has been: the march of technology has enabled us to travel faster, age more slowly, entertain ourselves differently, and build air-conditioned homes in the miserably hot south and southwest, and in our nation’s steamy capital. But the president has something more in mind and, with control of both houses of Congress, the power to change the way we live now. Let’s make a few guesses as to where those changes will take us.

Top of the president’s change list is the way we consume energy. He believes our use of carbon-based fuels is causing the globe to heat up, with all the dire consequences conjured up by Al Gore as he sits in the library of his home, probably the largest single consumer of energy of any private residence in America. By one means or another, the president will make the use of oil, natural gas and especially coal so expensive that consumers will be forced to use less energy, and rely more for the energy we do use on costly wind and solar power, paid for with tax-funded subsidies or higher utility bills.

Also, the day of spacious, safe cars is to end, with the exception of the limousines favoured by congressional leaders and White House appointees. Given the financial dependence of GM and Chrysler on government handouts, and regulations setting fuel-efficiency standards, these companies will be forced to produce and attempt to sell the small, preferably battery-powered vehicles beloved of environmentalists and congressmen from urban areas who rarely take to the open road. This will encourage more Americans to migrate to public transport because fewer will want to endure cramped, no-longer comfortable car rides to and from work.

Which is only one reason why it will become less popular to live in the suburbs. Another will be the new regulations that will be imposed on banks, preventing them from the excessive leveraging that has brought so many to Washington, begging bowls rattling. They will need more capital, which means their costs will be higher, which in turn means they will have to charge borrowers more. Higher interest rates make home ownership less attractive than renting (even if the interest costs of builders of apartment flats also rise), and large homes more difficult to afford. So more Americans will be unable to pursue the dream of home ownership, and fewer of the homes that so offend egalitarians and greens – with multiple-car garages and walk-in fridges – will be built.

The president will also change the way Americans receive their healthcare. Under the mistaken assumption that the uninsured do not receive proper healthcare – many without insurance are too young and healthy to need it, and the poor are treated without charge at local hospitals – the president will raise taxes or force businesses to pay for insurance cover for all Americans. The result will be a system closer to that in Britain, with all its disadvantages – bureaucracy, rationing, waiting lists and a slower rate of innovation.

In the end, Americans will live in smaller houses, drive cars more like those to which Europeans are accustomed, and will rely on European-style healthcare. In short, we will be more like you, which is after all the social democratic model to which Obama wants to convert America.

The president also intends to change the way our children are educated. He says he wants teachers to be compensated on a merit basis, and parents free to select schools they deem best for their children. But his allies in the teachers’ union won’t go along with this, and in the one test of his rhetoric so far he has allowed Democrats in Congress to kill a programme that provided funds to allow a few thousand poor, mostly black children to escape the horrors of the Washington DC school system and instead attend swanky private schools of the sort in which he has enrolled his daughters.

There is no doubt about one thing: the president intends to increase the number of students financially able to attend college. America will, in the end, have more degree-wielding students and fewer horny-handed sons of toil. That will produce another result the president has in mind as he rebuilds the American house on his rock: the earnings premium paid to highly educated workers will decline as the number of men and women competing for those jobs increases, and the relative wages of the fewer blue-collar – by then, green-collar – workers will increase.

This greater equality of income distribution is, for Obama, thesummum bonum. He is redesigning the tax system to narrow the after-tax gap between “the rich” – family incomes above $250,000 (£170,000) a year – and lower earners, even if the economic cost of such a move (reduced risk-taking) is quite high. Equality, not economic efficiency, is his goal. Which is why he favours raising the rate at which capital gains are taxed even if the result is a fall, rather than an increase, in the Treasury’s net receipts.

There will be more changes pushed through by a man who regards himself as a “transformational” president, in the mould of Abraham Lincoln and Franklin Roosevelt. Women will be “empowered” to bring more lawsuits if they feel discriminated against, eithernow or in years gone by; more Americans will work in the public sector as it expands relative to the private sector, and as Washington displaces New York as the nation’s financial capital.

Love him or loathe him, Obama will leave an America vastly different from the one he inherited. Unless, of course, sooner rather than later, voters decide they rather liked the older model.