Peter B. Doran and P. Bracy Bersnak: Europe's Crisis ... A Roadmap From the Past

Peter B. Doran is senior policy analyst at the Center for European Policy Analysis (CEPA) and P. Bracy Bersnak is assistant professor in the Department of Political Science and Economics at Christendom College.

These are rough days for the European Union (EU). What began as a sovereign debt crisis has now metastasized into a political debacle for the leaders left holding the bag. Nicolas Sarkozy's electoral defeat in France, the ouster of an austerity-minded government in Greece; and last month's collapse of the governing coalition in the Netherlands are all symptoms of a deeper problem for Europe: bloated governments are hard to tame, even when there is no money left to pay for them.

This is bad news for Europe. But the political tumult on the continent is also a stunning vindication of the post-War thinkers who anticipated this outcome. These individuals, men like Friedrich von Hayek and Wilhelm Röpke, would become founding intellectual fathers behind the modern conservative movement in Europe and the United States. Even today, their foresight provides a defining roadmap for navigating away from Europe's current crisis and offers a chilling warning to the United States about repeating the same mistakes.

Much like the debt crisis of our own time, the dimensions of Europe's post-War reconstruction were staggering. Only instead of ruined factories and decimated cities, today's contemporary European leaders must contend with bombed out credit ratings and the herculean task of reordering the continent's dysfunctional economies. Then, as now, the basic policy debate centered on the state's role as guarantor of public prosperity and welfare; and perhaps more importantly, how to finance it.