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Cloud Cuckoo Land refers to an unrealistically idealistic state where everything is perfect. ("You're living in cloud cuckoo land, mate.") It hints that the person referred to is naïve, unaware of reality or deranged in holding such an optimistic belief.
The reference comes from The Birds, a play by Aristophanes in which Tereus helps Pisthetairos (which can be translated as "Mr. Trusting") and Euelpides ("Mr. Hopeful") erect a perfect city in the clouds, to be named Cloud Cuckoo Land (Νεφελοκοκκυγία or Nephelokokkygia).
The German philosopher Arthur Schopenhauer used the word (German Wolkenkuckucksheim) in his publication On the Fourfold Root of the Principle of Sufficient Reason in 1813, as well as later in his main work The World as Will and Representation and in other places. Here, he gave it the figurative sense by reproaching other philosophers for only talking about Cloud-cuckoo-land. Fellow German philosopher Friedrich Nietzsche refers to the term in his essay "On Truth and Lying in a Nonmoral Sense."
Uses in politics 
- Adolf Hitler used the phrase in Mein Kampf to describe the proposals of his political opponents.
- U.S. Secretary of Agriculture Henry A. Wallace (later U.S. Vice President in Franklin D. Roosevelt's third term) used the term to describe the unrealistically inflated value of stocks on the New York Stock Exchange just before the crash of 1929 that signaled the onset of the Great Depression. In his 1936 book, Whose Constitution? An Inquiry into the General Welfare, Wallace describes a cartoon in a popular weekly magazine which "pictured an airplane in an endurance flight refueling in mid-air, and made fun of the old fashioned economist down below who was saying it couldn't be done. The economic aeroplane was to keep on gaining elevation indefinitely, with the millennium just around a cloud" (p. 75). Wallace wrote that Wall Street's practice of lending money to Europe after World War I "to pay interest on the [war reparations] debts she owed us and to buy the products we wanted to sell her … was the international refueling device that for 12 years kept our economic aeroplane above the towering peaks of our credit structure and the massive wall of our tariff, in Cloud-Cuckoo Land" (p. 77).
- Margaret Thatcher famously used this phrase in the 1980s, reflecting the values of the time: "The ANC is a typical terrorist organisation... Anyone who thinks it is going to run the government in South Africa is living in cloud-cuckoo land."
- British MP Ann Widdecombe used the phrase in a debate on drug prohibition with a representative of Transform Drug Policy Foundation: "...it is cloud cuckoo land to suggest that [people who don't currently use heroin would not start using it if it became legal]".
- Newt Gingrich referred to Barack Obama's claim that algae could be used as a fuel source as cloud cuckoo land.
- Paul Krugman used the phrase referring to inadequate German economic politics toward failing members of the European Union: "Basically, it seems that even as the euro approaches a critical juncture, senior German officials are living in Wolkenkuckucksheim — cloud-cuckoo land." (June 9, 2012)
Other uses