by whataboutbob
Mon Jul 18th, 2005 at 02:14:57 AM EST
Promoted by Colman
I was responding to a comment about the French economy in another thread, and I realized I should post a diary on this. In this weeks's Nation Magazine, there is an article "No Flat World in Europe", by a Thomas Geoghegan (which you have to subscribe to)
in which he addresses the reality (not the myth) of the success of the US/British economic models versus the EU.
The European miracle is often said to be the one that took place in the 1950's, right after World War II. But that was catch-up too. The real European miracle is the one that has happened in the past 10 years: Europe (especially France and Germany) has engaged in a restructuring of its manufacturing - successfully. The threat to Europe right now is the violence of the rhetoric agaisnt the model, the bizarre doom and gloom, when it is actually doing well. The nerve-wracking thing about Europe at the moment is the possibility that ordinary Europeans will lose their nerve and just cave in to their American-wannabe elites
The author addresses the Tom Friedman-American Neo-conservative line of BS, that the US/British economic model is better than Europe, which basically suggests that the French (and Europe in general) are 'too social', (read this: lazy) and that any social-focused economic system is not as good as the "free market" system. However, Goldman Sachs wrote a report last year ("Euroland's Secret Success Story") that suggests just the contrary: that the European economy is just as good as, or better than the American economy, and that a lot has to do with differences in what numbers are counted: (From Politiquessociales.net)
http://www.politiquessociales.net/Docs/MirrorMirrorOnTheWall.htm
I suggest reading the whole article, its quite informative, but here are some snippets:
GDP figures exaggerate America's relative performance, because its population is growing much faster. GDP per person (the single best measure of economic performance) grew at an average annual rate of 2.1% in America, against 1.8% in the euro area--a far more modest gap.
(...)
Furthermore, all of that underperformance can be explained by a single country, Germany, whose economy has struggled since German reunification in 1990. Strip out Germany, and the euro area's annual growth in GDP per person rises to 2.1%, exactly the same as America's.
(...)
The most popular myth is that America's labour-productivity growth has outstripped that in the euro area by a wide margin...but the difference between productivity growth in America and the euro area is exaggerated by misleading, incomparable figures.For the euro area, the European Central Bank publishes figures for GDP per worker for the whole economy. This shows a growth rate for the period of only 1.5%. But unlike the American numbers, this figure includes the public sector, where productivity growth is always slower, and it does not adjust for the decline in average hours worked.
I would add that in the US the unemployment numbers aren't truthfully or accurately being counted (in news from Boston this week, there have been reports about deliberate undercounting of unemployment numbers...surprise, surprise), which if you counted the people who are not on unemployment, or have given up looking, I would wager that the unemployment in the US is more like the 9% (or worse) than in France. Plus, at least in France, you are better protected and supported, whereas in the US, job security doesn't really exist, and god forbid you lose your job...good luck. No...the French have it better, imho.
At the end of the Geoghegan article, he makes this statement (again from the Nation):
The European miracle is often said to be the one that took place in the 1950's, right after World War II. But that was catch-up too. The real European miracle is the one that has happened in the past 10 years: Europe (especially France and Germany) has engaged in a restructuring of its manufacturing - successfully. The threat to Europe right now is the violence of the rhetoric agaisnt the model, the bizarre doom and gloom, when it is actually doing well. The nerve-wracking thing about Europe at the moment is the possibility that ordinary Europeans will lose their nerve and just cave in to their American-wannabe elites
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