Americans politicians don't like to be compared to the French. It's a simple adjective, one that oddly became an actual slur against Sen. John Kerry in the 2004 campaign, much as the esteemed term "professor" is being used as an insult now against Democratic Senate candidate Elizabeth Warren in Massachusetts. But U.S. lawmakers and candidates would be wise to look closely at the results of France's presidential elections.
Conservative President Nicolas Sarkozy was narrowly (by French standards) defeated by Francois Hollande, a moderate socialist, in Sunday's elections, and the results (along with a similar result in Greece on Sunday) are widely viewed as a rejection of austerity policy. Sarkozy in particular had been a chief architect, along with German Chancellor Angela Merkel, of the European strategy of making deep budget cuts to deal with the region's soaring debt. Voters thought the tactic was too severe, and threw the leaders out.
There's an unfortunate comparison as well, here, with many American voters, who don't want their taxes raised but also don't think the government should stop doing things like maintaining roads and bridges. The high cost of healthcare also needs to be dealt with, particularly the huge amount of money spent on healthcare during the last months of one's life. But European voters weren't merely putting their hands over their ears, refusing to accept the sacrifices needed to steady the economies there. They were saying that the task can't be done merely by cutting budgets, a view shared by many economists.
The same question is under scrutiny here, as lawmakers and presidential candidates argue about whether to cut spending, raise taxes, or both to keep the recovery moving (and perhaps speed it up). When the debt is this high, it's not realistic for the government to spend its way out of a recession. But with the private sector so skittish about hiring (despite the fact that a number of large corporations are making record profits), it's not sensible to reduce the debt by cutting spending alone. The private sector is, indeed, the primary creator of jobs. But when private industry can't (or won't) do it, the government needs to step in.
Hollande, whose socialist party identity comes with a strong free-market approach, will move into Elysee Palace because French voters didn't want the budget-cuts-only approach (Sarkozy limited tax rates for the wealthy). The U.S. election includes a slew of other issues that make it less of a referendum on budget cuts. But the European results may offer a warning to both parties here.