When you talk about Canadian and Western European societies prospering, you should emphasize that this is true even in times of deep economic crisis.
What most Americans see on a regular basis is economic and social turmoil in some European countries. The part of the story they miss is that those countries still have a relatively high quality of life even during economic downturns. Safety, health care, education, housing, workers rights, consumer protection, public transport and other services, they continue to function on a level unimaginable for an average unemployed American.
What makes austerity such a divisive topic is that its an attempt to shift the balanced formula of socialism/capitalism towards US style capitalism at the expense of the weakest.