Think Again: Europe

It likes to pretend it is a kinder, gentler alternative to the United States. But stagnant economies, suffering immigrants, and elitist rhetoric don't make a global powerhouse. With nothing less than the future of the European project at stake, the countries of Europe must now either unite behind much-needed reforms, or watch their differences tear them apart.

"Europeans Are Good Global Citizens"

"Europeans Are Good Global Citizens"

False. Undeniably, Europe’s governments put on a good show. They sign the Kyoto Protocol — a treaty that commits them to do little about global warming, and whose terms they then flout — while righteously deploring the United States’ refusal to join in. They call for a bold new round of trade negotiations to address the plight of the world’s poor, and then sink it with their refusal to dismantle their own agricultural subsidies. When it comes to foreign policy, they are entirely preoccupied — and most likely always will be — with their own internal, intra-European machinations. Making a hash of the "European Project" generally requires their full attention. But that is all right, because as far as external threats are concerned, the instinct of Europe’s leaders is to appease and deny, which requires little commitment of resources, multilateral or otherwise. Europe’s Iran policy is only the most recent instance: Never confront, just keep talking, and all will turn out well in the end. Iranian President Mahmoud Ahmadinejad, for one, certainly endorses that approach.

On occasion, the maintenance of global order requires a willingness to use military power, which in turn requires a prior investment in military hardware. Europe’s good global citizens apparently have more pressing priorities (such as those farm subsidies). The entire European Union (EU) spends about half as much on defense as the United States. That’s just as well because, when it comes to projecting force, the task can be left to those deplorable, unilateralist, gun-toting Americans. As a rule, they will come to the rescue.

"Europeans Are Lazy"

So what? If overachieving, workaholic Americans are the benchmark, Europeans are positively idle. Across the richer parts of the EU, people typically work far fewer hours, with shorter working weeks and longer vacations, than their counterparts in the United States.

But who says bigger cars and Sub-Zero refrigerators are preferable to more free time? If Americans live to work and Europeans work to live, Europe might be right. The people of Old Europe live well. The standard of living in rich (albeit slow-growing) countries such as France and Germany is higher than America’s wage-slaves might expect or hope. The United States’ much higher output per person is due mostly to more hours on the job, not to superior productivity while working. Most Europeans are actually just as productive as Americans on a per-hour-worked basis. In 2005, gross domestic product per hour worked was actually higher in supposedly stagnant France ($49) than in the United States ($48). Employees in Belgium, Ireland, and Luxembourg are all more productive per hour than are America’s workers, and many other European economies are far closer to the United States in output per hour worked than in output per worker, the most-cited measure.

Admittedly, two points must be kept in mind. First, unemployment is higher in most European countries than in the United States. The productivity of those unemployed and typically unskilled people, were they to find jobs, would be lower than the average. On an even playing field, with universal full employment, the United States’ advantage in productivity per hour worked would thus be bigger. Second, when they do work less, Europeans are not always expressing a free preference for leisure over toil: They are encouraged, and sometimes forced, to make that choice by labor-market restrictions (such as statutory working weeks) and high taxes. Without those policies, who knows how hard Europeans would work? But to the extent they are expressing a genuine preference for leisure over work, good luck to them.

"The European Economy is Failing"

There’s no such thing, except in the minds of Brussels bureaucrats and non-Europeans. The EU is an enormous and highly heterogeneous entity — rich countries, poor countries, some advanced, some backward. With the accession of Bulgaria and Romania at the start of this year, its membership grew to 27 nations. The union’s richest countries have per-capita incomes exceeding $30,000 a year; adjusting for differences in purchasing power, the two newcomers have per-capita incomes below $11,000. Recent growth rates, and prospects for future growth, vary just as widely.

No question, joining the union spurred transition economies such as the Czech Republic and Poland to grow much faster than they otherwise would have. Ireland’s economic growth, owing much to its EU membership, has been little short of astounding. Ireland is now one of the richest members of the union, second only to Luxembourg. These are success stories by any standard. But the big economies of the old six-member European Coal and Steel Community, the precursor to today’s EU, have been dragging their feet. Growth in France, Germany, and Italy has been much slower over the past 10 years than growth in the United States because they saw no breakthrough in productivity during those years. Their poor performance drags down the EU average.

But the point is, why care about that average in the first place? It makes no sense to talk of "Europe’s" economic failure. Granted, most of the major economies in Europe now have one currency and a single policy-driven interest rate, and it is true that the European Central Bank has been criticized for keeping monetary policy too tightly restricted. But slow growth in France, Germany, and Italy has more to do with supply-side inefficiencies than lack of demand. Those frictions, and the policy mistakes that explain them, are entirely national in character.

"Europe’s Social Model Is More Humane"

Not so. European approaches to the welfare state — nearly everywhere, kinder and gentler than America’s — are doubtless well intentioned. Whether the results are actually more humane in practice is debatable at best. Employment protection laws, typically more stringent than those in the United States, discourage new hiring. High minimum wages, assorted union privileges, social-protection mandates, and other regulations make workers more costly to European employers than their American counterparts. And the jobless can usually expect more generous, longer-lived, and less rigorously tested benefits than would be paid in the United States. To varying degrees across the union, the unintended consequences are higher levels of voluntary, long-term unemployment and a culture of welfare dependency.

This labor structure is bad enough for young people, who are disproportionately affected by minimum wages and firing restrictions. The consequences for unassimilated immigrants and their children are worse. Due to discrimination, they are already at a disadvantage in the job market. These supposedly kindhearted but effectively employment-curbing policies then make matters worse. They also poison politics. European conservatives are far more united than their counterparts in America on immigration — but not in a good way. Immigrants to Europe are more likely to be unemployed than in the United States. The economic benefits of their arrival are therefore less, which shores up a populist, conservative, anti-immigrant platform.

Old Europe needs immigrants to lessen the strains of its looming demographic transition. Forecasts show that the United States’ problems with Medicare and Social Security several decades from now, bad as they may be, are nothing compared to the pressures that will confront France, Germany, and Italy. Europe’s supposedly humane social model worsens the problem by adding to the fiscal burden and making immigration a less feasible remedy. And before those fiscal problems even arrive, that kinder, gentler approach to social benefits — the reluctance, in short, to insist on work — makes the assimilation of immigrants more problematic. And that’s hardly humane.

"Europe Provides the World’s Best Healthcare"

Not really. A popular fallacy in the United States is that, when it comes to healthcare, Europe offers a single universal-coverage alternative to the predominantly private U.S. system. In fact, Europe has as many different healthcare systems as it does countries.

True, the United States’ system is an outlier because of its reliance on private insurance. But Europe’s systems offer no single, plainly superior substitute. Rather, they represent a bewildering array of very different, ever changing, and frequently unpopular models. Britain combines a single-payer, universal-access National Health Service with an extensive and rapidly growing private-insurance system, which sprang up because of discontent over standards in the state sector. The share of private spending runs higher in France, Germany, and Italy, and approaches 40 percent in the Netherlands. Competition, control, and cost-sharing vary widely as well: single-payer, multipayer, centralized, decentralized, and everything in between. This endless variety proves the difficulty of getting healthcare right. The issue is a political battleground almost everywhere.

If you have insurance, the U.S. system provides you with world-class healthcare at a high price. Does any European country offer a system that is both feasible and plainly preferable for the insured majority? The answer is no. By common consent, the French system is among the best: expensive (though cheaper than the U.S. option); universally accessible; with plenty of patient and doctor autonomy, good results on standard measures, and it’s popular to boot. What’s not to like? Well, ask a French doctor or two when they return from their protest march. They’re paid roughly a third of what American doctors make. The French system with American salaries would be unaffordable.

"Europe Is Going Muslim"

Yes, but very, very slowly. Across the EU, Muslims still account for less than 4 percent of the population. But they are having children — lots of them — and other Europeans aren’t. So, Muslims (even apart from further immigration) will certainly be a growing minority in the years to come. The calculation changes radically if Turkey were to join the union, though this seems an increasingly distant prospect.

More important than the raw numbers is the fact that Muslims are poorly assimilated in many European countries. Typically, their rates of unemployment are higher than the general population, and their incomes are lower. In Britain, France, Germany, and many other European countries, Muslims (and other non-white immigrants) tend to be concentrated in particular areas, where they form a majority. Culturally, not just in their religious lives, many Muslims live quite outside their country’s mainstream.

According to a survey conducted last year by the Pew Global Attitudes Project, 81 percent of British Muslims consider themselves "Muslim first" and only 7 percent "British first." (The split is similarly skewed in Germany and Spain.) That figure shocks and disturbs many Britons. But the same survey says that almost 90 percent of Pakistanis consider themselves "Muslim first" rather than "Pakistani first." Faith makes large claims on identity among Muslims wherever they live, more than predominantly secular Europeans readily understand. Interestingly, the split in France is less dramatic: Only 46 percent of French Muslims consider themselves "Muslims first," about as many who consider themselves "French first." Burning cars notwithstanding, those numbers suggest that there may be something to be said for France’s aggressive insistence on a secular public sphere, as opposed to the warm embrace of multiculturalism in Britain and elsewhere.

"Europe Is Anti-American"

Only in part. To be more precise, yes, the animating spirit of the EU is anti-American. But this is an elite pathology much more than a popular one. Then again, the EU is a project, par excellence, of Europe’s elites. The recent constitution-writing fiasco underlines that point. For decades, Europe’s leaders have explicitly said that voters don’t know what is best for them; that the leaders will build a united Europe and the people will come to like it once it is there. When they put their proposed new constitution to a popular vote, and the French and the Dutch rejected it, governments were shocked. How dare voters do that?

This European "arrogance of power," with its fundamentally antidemocratic underpinnings, is something many Americans find hard to understand. Europe’s political class returns the compliment by finding America’s robust and genuine democratic traditions (consider the death penalty, or the right to bear arms) dreadfully vulgar. In addition, Old Europe’s leaders, again far more than Europe’s peoples, regret and resent American power. The institutions of the union itself express that worldview, another reason why American unilateralism — deployed, as it very often is, in Europe’s interests — is so bitterly denounced. Europe cannot act unilaterally. It lacks the will and the means. Rather than face this reality squarely, member states find it better to moralize on the evils of unilateralism.

The EU was originally conceived as a set of institutions to promote economic cooperation, contain Germany, and avert another war — admirable goals, to be sure. But they were secured long ago. The new purpose of the EU — the impetus for its further political development — is to challenge the United States for global leadership. Look at the rhetoric surrounding the launch of the euro. Why do Europe’s economies need a single currency? To promote trade? The United States and Canada seem to get along very well, from a trade-integration point of view, with separate currencies. No, the reason was that the dollar was (and is) the preeminent global currency, and that offended Euro-visionaries. If the United States has a currency, then Europe must have one, too.

For more than 50 years, U.S. diplomacy has generally been supportive of European integration. That made perfect sense when the union was mainly about securing internal peace, liberalizing trade, and giving the United States a stronger ally against the Soviet Union. Now that the EU is concerned primarily with establishing itself as a counterweight to America — a necessary rival, in its view — the United States might want to consider returning the favor.

Clive Crook is chief Washington commentator and associate editor at the Financial Times, senior editor at The Atlantic Monthly, and a columnist for National Journal.

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