Thursday, December 01, 2005

Europe's Economy: A failure? 

Or is America's economy just absolutely amazing and thus overshadows other good economies? Read this before you decide:
These views have not been dislodged, even by serious economic problems. And Europe's economic problems are serious. The unemployment rate is stuck at around 10% in Germany and France, and if anything this underestimates the true figure--even more unemployment is concealed through extensive job-training and early-retirement schemes. The fact that many continental European economies have such mechanisms for sidelining less-skilled workers makes it all the more striking that labor productivity still generally grows faster in the United States. For decades, France and Germany had narrowed the gap in labor productivity with the U.S., but in the past 15 years their progress slowed and then reversed.

The result is that average U.S. per capita income is now about 55% higher than the average of the European Union's core 15 countries (it expanded to 25 in 2004). In fact, the biggest E.U. countries have per capita incomes comparable to America's poorest states. A recent study by two Swedish economists found that if the United Kingdom, France, or Italy suddenly were admitted to the American union, any one of them would rank as the 5th poorest of the 50 states, ahead only of West Virginia, Arkansas, Mississippi, and Montana. Ireland, the second richest E.U. country, would be the 13th poorest state; Sweden the 6th poorest. The study found that 40% of all Swedish households would classify as low-income by American standards.
Yikes. I didn't realize we had it so good here, and they have it so bad in Europe (relatively speaking). Those that say we should look to Europe for a model of how a wellfare state can succeed should consider how poor the average European in even the large countries in Europe actually is. We don't normally look to states like Mississippi or West Virginia for examples of how we want the country to be overall (no offense to those staets, but the truth is the truth, and people like stereotypes).

This excerpt comes from an article on what differences there are between European and American conservatism (and thus differences between Europe and America in key areas). I highly recommend it.

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