Christopher Ruddy's Perspective: I’m just back from Europe and feel somewhat unsettled.
Here in the United States, June's job numbers — nonfarm pay rolls increased by 195,000 — suggest the U.S. economy is in recovery. But across Europe, most of the continent remains in recession or near recession.
Each week The Economist magazine publishes the economic indicators of important economies around the globe. The latest “Euro Area” summary shows GDP growth at about negative 1.1 percent.
Worse, countries showing even anemic growth have high unemployment, especially among the young. Spain has about 50 percent unemployment for its population under 30. The numbers in France, Italy, Greece, and Britain are only slightly better.
It is a recipe for crisis and revolt.
A friend of mine, a Frenchman who works for a major bank in Geneva, told me he thinks the stage is set for “revolution” across Europe. He didn't say it loudly, and his wife told him to stop being negative.
Shortly after I spoke with him, I read in The Wall Street Journal's Europe edition Francis Fukuyama’s article “The Middle Class Revolution.”
The events we have seen in the Arab Spring, and now in countries like Turkey and Brazil, are not isolated, but part of a new movement of revolt by rising middle classes around the world.
Fukuyama concluded: “The U.S. and Europe are experiencing sluggish growth and persistently high unemployment, which for young people in countries like Spain reaches 50 percent. In the rich world, the older generation also has failed the young by bequeathing them crushing debts. No politician in the U.S. or Europe should look down complacently on the events unfolding in the streets of Istanbul and São Paulo. It would be a grave mistake to think, ‘It can't happen here.’"
I am writing more about the American economic crisis in the next edition of the Financial Intelligence Report, the monthly investment newsletter published by Newsmax.
Jim is neither a contrarian nor an iconoclast. I believe he is simply a man who looks at reality head-on. Time and again he has predicted the major crashes, notably the 1987 stock market crash, the tech bubble of the late 1990s, and the housing crisis of 2008-2009.
He argues that the deleveraging of global debt won’t happen anytime soon, and he paints a picture of perhaps two decades of economic struggle ahead.
The politicians have turned over the hard decisions to the Federal Reserve, which, in turn, is too political to take tough measures that could set the stage for full recovery. The Fed, led by Alan Greenspan and Ben Bernanke, has exacerbated the crisis.
In early July, I woke to find London’s Telegraph at my door with a roaring headline: The top government minister in Britain was predicting that the economic crisis would last 20 years.
All of this does sound a bit negative.
But from negatives a thinking person can find the silver linings, as Rogers outlines in his extremely compelling book.
A Coup in Egypt?
The recent military overthrow in Egypt can hardly be described as a coup d'état.
It must be remembered that the Islamist President Mohammed Morsi was duly elected, and soon thereafter tried to upend the constitution and abolish many of its provisions, making him an authoritarian ruler.
Only an outcry from both in and outside Egypt prevented him from obtaining dictatorship. However, he clearly revealed his cards and his intentions.
As president he has done some outrageous things, including releasing numerous terrorists from Egyptian prisons, including the killers of Anwar Sadat.
Democracy implies an acceptance of constitutional rules. Those who seek to destroy the constitutional rules have no claim, in my mind, to constitutional protection.
Abraham Lincoln took upon himself powers not granted him in the Constitution in an effort to preserve and save the Constitution and the Union itself. No serious historian would argue that he was engaging in a coup.
Rise of Rand Paul
Most political observers on both sides of the political aisle viewed freshman Sen. Rand Paul as a clone of his libertarian leaning dad, Ron Paul, the former congressman and presidential candidate.
Ron Paul is indeed an honest and good man, but his views can be quirky and extreme, such as calling for the abolishment of the Federal Reserve and a foreign policy based on dangerous isolationism.
But time is moving on, and we are getting a much better picture of son Rand Paul. He is showing that he is no extremist, no clone of his father, with sensible positions on economic and foreign policy matters, along with the gravitas necessary for leadership.
Marco Rubio, Hero
Another freshman senator showing remarkable leadership skills is Marco Rubio of Florida.
He has led the charge in the Senate for sensible immigration reform. He stuck his neck out, and some folks are not happy about his positions.
There was not much personal political gain for Rubio to lead the charge here. He had high popularity among the Republican base, and we all know that immigration is a controversial issue, especially among conservatives.
Rubio offered a reasonable plan to deal with our illegal immigrant problem, requiring illegals to pay restitution and begin paying taxes. Even after 10 years they still did not receive citizenship under his plan. My own view is that after such a long period illegals should be eligible for citizenship.
Being open to immigrants is good for the Republican Party, but vitally important for the United States. The demographic trends in the United States are not good, with increasingly aging population moving into a period of retirement and making more demands on entitlement programs like Medicare and Social Security.
We need more people of working age to keep the economy moving.
We need more leaders like Rubio to keep us moving forward as a nation.
Christopher Ruddy is CEO and editor of Newsmax Media Inc. Read more Christopher Ruddy Insider articles — Click Here Now.
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