Posted on 03/12/2005 8:04:52 AM PST by Alex Marko
BRUSSELS - The US economy is 20 years ahead of that of the EU and it will take decades for Europe to catch up, according to an explosive new study published on Friday (11 March).
The survey, unveiled by pan-EU small business organisation Eurochambres, is intended as a sharp "wake-up call" for EU leaders as they gather on 22 March for a summit on how to boost growth and jobs in the EU economy.
The EU's current performance in terms of employment was achieved in the US in 1978 and it will take until 2023 for Europe to catch up, the report shows.
The situation is scarcely better when it comes to income per person. The US attained the current EU performance in 1985 and Europe is expected to close the gap in 2072.
But the bleakest picture comes when comparing the two economic blocs in terms of research and development. Europe is expected to catch up with the US in 2123 and then only if the EU outstrips America by 0.5 percent per year in terms of R&D investment.
Presenting the survey, Arnaldo Abruzzi, the Secretary-General of Eurochambres, said, "the current EU levels in GDP, R&D investment, productivity and employment were already reached by the US in the late 70s/early 80s".
"Even the most optimistic assumptions show it will take the EU decades to catch up and then only if there is considerable EU improvement", he concluded.
Furthermore, the survey points out that enlargement will make the EU's mountain even harder to climb.
"Data clearly suggest that including the 10 new member countries in the comparison would further deteriorate Europe's position compared to the US for all four major indicators", says the report.
The survey was conducted using a method called the "time distance measure", pioneered by Professor Pavle Sicherl at Ljubljana University.
Eurochambres called for EU leaders to focus on concrete actions to revive the EU's economy and for a communications strategy to lay out the economic challenges facing the EU.
The group represents 18 million enterprises across Europe.
Actually, this could happen. If America continues to slide to the left, we could end up a sullen, stagnant mess like the EU.
On the brighter side, the EU will probably be a Caliphate in twenty years, which could make them a lot more straightforward to deal with.
Why? Do you like higher National Unemployment?
Well, the dollar can fall on a number of reasons. From consumer confindence, oil prices,etc etc but its usually Policy set by the treasury department.
The high euro is actually good for the US as it boosts our exports and devalues our deficit.
Not going to happen.
Furthermore, the EU is destined to break up. The different cultures that make up the EU are too diverse for them to truly be a unified "nation". Petty squabbles between them will continue to drive them apart and prevent them from achieving true cohesiveness.
It took the Civil War to truly bring the United States together. It was only after the Civil War that this nation truly achieved the explosive growth that made it the premier superpower it is today. Even still, the bitterness of the Civil War took decades to dissipate and even today, 140 years later, there are still pockets of the country that haven't gotten over it. But without the Civil War, we would have turned out much like Europe - a group of separate countries always bickering among each other.
At any rate, I stated earlier that the United States is poised to achieve even more spectacular growth in the decades ahead. This country is still only about 230 years old and it is still very much in it's "adolescence" phase. We have built ourselves into the worlds biggest superpower and our true rival is not going to be the EU but will be China.
How will the United States avoid being replaced by China as the world's superpower?
Growth.
To our north, Canada sits with its vast natural resources and virtually untapped wealth. Canada is destined to join the United States someday. Sound ridiculous? Imagine if I stated 20 years ago that someday soon, the nations of Europe would attempt to cobble together a super-nation with a super-economy with a common currency and elimination of borders? It would have sounded far-fetched. Yet here we are today.
What if I told you 20 years ago that soon, the Soviet Union would collapse and break up into separate nations? You would have laughed at me right? 20 years ago, we saw the Soviet Union as the greatest threat to our existence and many actually saw the Soviet Union as a greater superpower than even the United States!
But in reality, the Soviet Union never had a chance.
Neither does the EU and neither does China.
The United States has the entire Western Hemisphere to itself. While Europe and China must contend with well-established nations in their hemisphere, the United States sits in the Western Hemisphere pretty much by itself.
Mexico and the Central American countries. The South American countries of Brazil, Venezuela, Chile, etc. All these nations will eventually join with the United States to ensure that our superpower status is secure. Imagine the United States extending from the Arctic Circle to Antartica. It's going to happen. Might take another 100 years, but it's going to happen eventually and perhaps much quicker than we think. Probably even within many our our lifetimes.
Again, think of how ridiculous it seemed that the Soviet Union was going to collapse just 20 years ago. Imagine how different things might be looking 20 years from now.
I see Canada and Mexico becoming part of the U.S. in my lifetime along with Cuba and much of the Carribean. The Central American and South American countries might take much longer but it will happen.
After that, Greenland, Iceland and perhaps even Great Britain itself will finally join the U.S. as well as other English speaking countries such as Australia and New Zealand.
Think of Australia sitting all by itself over there with the Chinese behemoth to its north. You think it would rather join with them? I doubt it. I see Australia eventually becoming part of the United States of America as well.
In summary, I see the globe reducing to three major spheres of influence. The United States of America, Chinese Asia and whatever is left of Europe.
Africa is currently up for grabs. It will become very interesting to see what becomes of that over the next 100 years. I do not see that continent becoming a superpower of it's own. It will need to choose between Europe, Chinese Asia and the United States.
It will be interesting to see how India goes as well. I think they might end up leaning towards the United States.
Sam, i cannot agree with you more. From China, to Canada, to the EU catching up, you are 110% correct.
7.2% national average for 1985. Which by grading standards is close to average unemployment. Right now we are near 3/4 of a point below the national average for the last 40 years.
With all due respect, you do not understand the meaning, in labor economics terms, of the word "productivity."
In claiming, in the context of your discussion of productivity, that people are working "longer," you seem to be implying that increased productivity is achieved as the result of people working longer hours.
In fact, productivity is the measure of the PER/HOUR value of goods or services produced by a worker. It is precisely by increasing productivity that workers become more valuable, and can earn as much or more than they previously earned by working FEWER hours.
If people become more productive, and choose to work longer hours, than they would be multiplying their earning power. But again, to recapitulate, productivity increases are entirely unrelated to longer working hours.
Europe suffers more from high oil prices from the middle east because it imports nearly 90% of its oil from the region. The US gas prices are a result of refining capacity limits compounded with oil prices.
Wrong. Productivity is simply the value of goods/services produced by a worker divided by the number of hours worked.
But how are the hours worked counted?
If someone works 60 hours, but only 40 are counted, then ARCADIA's point holds.
If, on the other hand, all those hours are counted somehow (surveys or whatever), then you are correct.
If the European Union were a state in the USA it would belong to the poorest group of states. France, Italy, Great Britain and Germany have lower GDP per capita than all but four of the states in the United States. In fact, GDP per capita is lower in the vast majority of the EU-countries (EU 15) than in most of the individual American states. This puts Europeans at a level of prosperity on par with states such as Arkansas, Mississippi and West Virginia. Only the miniscule country of Luxembourg has higher per capita GDP than the average state in the USA. The results of the new study represent a grave critique of European economic policy.
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