In these days of renewed gloom about the future of Europe, a quick test is in order. Who has the world’s biggest economy? A) The United States B) China/Asia C) Europe? Who has the most Fortune 500 companies? A) The United States B) China C) Europe. Who attracts most U.S. investment? A) Europe B) China C) Asia.
The correct answer in each case is Europe, short for the 27-member European Union (EU), a region with 500 million citizens. They produce an economy almost as large as the United States and China combined but have, so far, largely failed to make much of a dent in American perceptions that theirs is a collection of cradle-to-grave nanny states doomed to be left behind in a 21st century that will belong to China.
That China will rise to be a superpower in this century, overtaking the United States in terms of gross domestic product by 2035, is becoming conventional wisdom. But those who subscribe to that theory might do well to remember the fate of similar long-range forecasts in the past. At the turn of the 20th century, for example, eminent strategists predicted that Argentina would be a world power within 20 years. In the late 1980s, Japan was seen as the next global leader.
The latest pessimistic utterances about Europe were sparked by a debt crisis in Greece which raised concern over the health of the euro, the common currency of 16 EU members. Plus U.S. President Barack Obama’s decision to stay away from a U.S.-EU summit scheduled for May in Madrid, with a new EU leadership structure that should have made it easier to answer then U.S. Secretary of State Henry Kissinger’s famous question: “Who do I call when I want to talk to Europe?”
There are still several numbers to call in the complex set-up, giving fresh reasons to fret to those crystal-gazers who see the future dominated by the United States and China, the so-called G-2.
Pundits who see the European way of doing things as a model for the United States (and others) to follow are few and far between, not least, says one of them, Steven Hill, because most Americans are blissfully unaware of European achievements and, as he puts it, “reluctant to look elsewhere because ‘we are the best.’”
As foreigners traveling through the United States occasionally note, the phrases “we are the best” and “America is No.1″ are often uttered with deep conviction by citizens who have never set foot outside their country and therefore lack a direct way of comparison. (They are in the majority: only one in five Americans has a passport).
Hill, who heads the political reform program at the New American Foundation, a liberal Washington think tank, has just published a book whose title alone is enough to irk conservative Americans: Europe’s Promise. Why the European Way Is the Best Hope in an Insecure Future.
STUBBORN PRECONCEPTIONS

It marshals an impressive army of facts and comparative statistics to show that the United States is behind Europe in nearly every socio-economic category that can be measured and that neither America’s trickle-down, Wall Street-driven capitalism nor China’s state capitalism hold the keys to the future.
While China’s growth has been impressive, says Hill, the country remains, in essence, a sub-contractor to the West and is racked by internal contradictions.
“When I talk to American audiences,” Hill said in an interview, “many find the figures I cite hard to believe. They haven’t heard them before. U.S. businesses making more profits in Europe than anywhere else, 20 times more than in China? 179 of the world’s top companies are European compared with 140 American? That does not fit the preconceptions.”
Such preconceptions exist, in part, because U.S. media have portrayed Europe as a region in perpetual crisis, its economies sclerotic, its taxes a disincentive to personal initiative, its standards of living lower than America’s, its universal health care, guaranteed pensions, long vacations and considerably shorter working hours a recipe for low growth and stagnation. “In the transmission of news across the Atlantic, myth has been substituted for reality,” says Hill.
He is in good, though numerically small, company with such views. The economists Joseph Stiglitz and Paul Krugman, both Nobel prize winners, also have positive outlooks for Europe. In a recent column in the New York Times, Krugman said that Europe is often held up as evidence that higher taxes for the rich and benefits for the less well-off kill economic progress. Not so, he argued. The European experience demonstrates the opposite: social justice and progress can go hand in hand.
The relative rankings of countries tend to be defined by gross domestic product per capita but Hill points out that this might not be the best yardstick because it does not differentiate between transactions that add to the well-being of a country and those that diminish it. A dollar spent on sending a teenager to prison adds as much to GDP as a dollar spent on sending him to college.
On a long list of quality-of-life indexes that measure things beyond the GDP yardstick — from income inequality and access to health care to life expectancy, infant mortality and poverty levels — the United States does not rank near the top.
So where is the best place to live? For the past 30 years, a U.S.-based magazine, International Living, has compiled a quality-of-life index based on cost of living, culture and leisure, economy, environment, freedom, health, infrastructure, safety and climate. France tops the list for the fifth year running. The United States comes in 7th.

I'm still staying put in the States!

Ever Been to Europe? Just curious. I haven't visited the US.

Lived there a few years.

This is a bold Statement.

The United States is behind Europe in nearly every socio-economic category that can be measured and that neither America’s trickle-down, Wall Street-driven capitalism nor China’s state capitalism hold the keys to the future.

Social Democracy The European Way

I'll wait to see the results of the economic policies in the aforementioned places.

I think Europe tried that once.

U.S. media have portrayed Europe as a region in perpetual crisis, its economies sclerotic, its taxes a disincentive to personal initiative, its standards of living lower than America’s, its universal health care, guaranteed pensions, long vacations and considerably shorter working hours a recipe for low growth and stagnation. “In the transmission of news across the Atlantic, myth has been substituted for reality,

yep,Stiglitz and Krugman!

The Arch-Keynesians!

Apostles of the Bailout and Unlimited Government Spending!

In Europe perhaps

Europe or America for you?

screw Europe!
It's going down!
EURO will see to that!

Thats just wishful thinking. Angela is in for the long haul.

http://mises.org/daily/5700/Fiat-Money-and-the-Euro-Crisis

http://mises.org/daily/5914/The-Future-of-the-Euro

Deeper and deeper into Statism,yet have the nerve to chide the USA!

We at the ECB will do all that is needed for the euro to have a long and prosperous life. Yves Mersh.


http://in.mobile.reuters.com/article/idINDEE9450C220130506?irpc=932

European nations and Scandinavia will become more populated with muslims and terrorism in the future.Europe will be in constant and violent turmoil. Sadly, the future is not bright for Europe.

We are doing just fine here in Euroland. We dont scare that easy at this side of the water.

(updated May 15th 2013)



DESPITE greatly improved financial conditions over the past nine months following the pledge by Mario Draghi, head of the European Central Bank, to do “whatever it takes” to save the single currency, the euro area remains mired in recession. Output declined by 0.2% in the first three months of 2013 from its level late last year, the sixth consecutive quarter of a recession that started in late 2011. GDP rose by just 0.1% in Germany, the biggest economy in the euro area and declined by 0.2% in France, the second biggest. Falls in southern Europe were much bigger, with GDP declining by 0.5% in Italy and Spain and 1.3% in Cyprus.

Forecasts from the European Commission in early May showed annual euro-zone GDP shrinking by 0.4% in 2013, following a contraction of 0.6% in 2012. The economic reverse will be much deeper on the periphery of the single-currency club than in its core. Cyprus will take over from Greece as the worst performer this year as its GDP shrinks by 8.7% (a prediction that could well prove optimistic). The Baltic states will continue to shine. The economy tipped to prosper the most within the 17-country euro area is Estonia’s, whose GDP will rise by 3% in 2013. Within the 27-nation European Union (EU), Latvia which is expected to join the euro next January will be the star performer, with its GDP increasing by 3.8%.

The disparity between core and periphery is particularly stark in labour markets. Unemployment in Germany was just 5.4% of the workforce in March 2013, whereas in Greece and Spain it was around 27%. The gap is even bigger for young people. In Germany the youth jobless rate was 7.6% in March whereas it was 56% in Spain and reached 64% in Greece in February. These figures overstate the blight of youth unemployment because many young people are in full-time education and so do not count as part of the labour force (the denominator of the unemployment rate). But they highlight the disjuncture between northern and southern Europe.


Even so there has been more rebalancing in the periphery than is sometimes appreciated. Current-account deficits which had ballooned in the first decade of the euro have narrowed. Portugal’s deficit has shrunk from 12.6% of GDP in 2008 to 1.5% in 2012; over the same period Greece’s has fallen from 15% to 3%. Primary budget balances (ie, excluding interest payments)—a crucial measure in determining the sustainability of public finances—are also on the mend. Greece’s is expected to reach zero in 2013 – an extraordinary swing from its deficit of 10.5% of GDP in 2009. Indeed the highest primary deficit in the EU this year will be run by Britain (of 3.9% of GDP).

Despite these improvements, government debt levels are worryingly high in the periphery. Despite a bond buyback late last year and the writedown of over half of privately held debt in March 2012, Greek debt will reach 175% of GDP by the end of this year, an untenable burden. Although Greece is being helped by interest deferral and maturity extension along with very low interest rates, it needs a further restructuring, this time of official debt. Italy’s debt burden continues to rise, to 131% of GDP this year, and debt in Ireland and Portugal is forecast to reach 123%.


www.economist.com

How dare you introduce facts into this debate?

[ /sarc ]