European Dominance (EU): Fact or Fiction?

Demographers say that to keep a population's numbers stable, the magic number is 2.1. That is the birthrate needed in any society to replace the number of deaths.

CBN.com – BRUSSELS, Belgium -- You can feel the anticipation in the city of Brussels. When the European Union enlarges in May, it will become the world's largest economic superpower: 455 million people in 25 nations, with a combined economy that Europeans enjoy telling Americans will be even larger than that of the United States. The prospect of pushing around the United States has some Eurocrats drooling. The vision is not of a single European super-state, but of a multilateral collection of nations that together will be an economic superpower, and if it chooses, will be able to stand up to the United States.

But alas, the dream of European dominance appears to be stillborn. A looming demographics disaster unparalleled in modern times threatens to send Europe into the dustbin of history.

Europe's population numbers have begun a free fall that could leave the 25-nation EU with only half the population of the United States in 100 years. Pretty amazing considering that 50 years ago, just the 15 members of the present EU had twice the population of the United States (296 to 152 million). But the 25 members of the enlarged EU will be only one-third bigger than the U.S. (450 to 293 million). And, as present birthrates and immigration levels play out, by 2050, the U.S. population could stand as high as 550 million, with the 25-nation EU at 360, and plummeting.

"I have no doubt in my mind that the greatest challenge facing Europe is the demographic problem," says Tim Evans, who heads the Center for the New Europe in Brussels. "The political leadership of the EU have set in a tablet of stone the promise that by 2010, Europe is going to see more economic growth and more prosperity than any other part of the developed world."

That looks increasingly unlikely. No modern society faced with a declining population on the scale facing Europe has seen economic growth.

Why aren't European women having more children? The two reasons given most by Europeans are that women are choosing careers over motherhood, and the high cost of raising children in Europe.

Dr. Cecile Philippe is president of the free market think-tank Institut Molinari. She says, for her and other French women, it is a matter of economics. Europeans can't afford to pay for large families and a bloated welfare state.

"People cannot really choose how many kids they want to have. To build your life, to become rich and wealthy enough to have the possibility to offer your kids what you think is important. This is simply not a possibility anymore. You look at what you can do. In the case of children, how many can you have, and very often you decide not to have the second one or the third one, because simply you do not have the economic means to do that. You're trying to make enough money to take care of yourself and pay your taxes, and maybe then you'll decide how many children you will have. But I don't call that a choice."

Evans says, "Taxes are so high in Europe. And the cost of the welfare state and regulation is so high that people actually don't have the money to raise children. I think if you look at failing state education on this continent, if you look at tax rates of 40, 50, 60 percent, then you begin to understand why parents, if they're planning to have children, …usually plan increasingly to have one or two."

Demographers say that to keep a population's numbers stable, the magic number is 2.1. That is the birthrate needed in any society to replace the number of deaths. In 1960, Europe's was 2.6. Today it is 1.4. The U.S. number is just under 2.1, but is augmented greatly by high immigration rates. In Italy, where the rate is an alarming 1.2, the government has been experimenting with paying families to have more children. It is not working. The Italians are on a course to disappear from the planet completely in the next 100 years or so.

Small towns and villages across Europe are depopulating. Deustche Bank warns that Germany could be a tiny nation of 25 million by 2100.

If you are thinking all this is going to mean are some sweet real estate deals in Rome or Paris in 20 years, think again. The political fallout from Europe's demographic disaster will be felt around the world. It will create a huge drag on the world economy, and historic political and strategic changes. By 2050 there will be almost as many retirees as there are workers in most European nations. That's unsustainable, unless benefits are slashed dramatically, or retirement ages are raised considerably. And this is what happens in Europe today when governments try to do that. They strike. Europe will be an even less reliable ally for Washington, since what nation struggling with bulging retirement rolls is going to want to spend more on defense? And increasing numbers of Arab and Muslim immigrants, with three times the birthrate of native or white Europeans, are likely to turn Europe against Israel and the United States even more.

Still, at the EU-aligned European Policy Centre, Political Director John Palmer says increased immigration is the answer for Europe. He said, "We will have to come to terms with significantly greater migration. I think how we handle that will be a very major challenge for policy makers in Europe, but it is going to be inevitable if we are to sustain the living standards, the growth, the competitiveness of the European economies."

But immigration is also the problem. Backed by public opinion, more and more European governments are trying to limit immigration levels, not increase them. Far-right groups who want to literally ship Africans and Asians back to their home countries are growing in almost every European nation.

With economic growth rates already at only about one percent and unemployment at close to 10 percent, Europe's future does not, in fact, look bright at all.

Evans said, "The cost to European economy and European prosperity in the future, if we don't decrease the welfare state, is going to be a sustained and ongoing demographic crisis. And that's going to be a spectacular catastrophe, because not only will we not be the most prosperous world (sic) of 2010, we'll be nowhere by 2020. We'll be a joke."

There is no historical precedent for the demographic disaster facing Europe, unless one goes back to the fall of Rome. Europe has two choices. It can start having more babies, or let in more immigrants. But in 2004, neither looks likely.

Because of the declining population...

I don't think there's a direct relationship between population change and any of this stuff. How many IPOs did Algeria have last year...or Egypt...or Nigeria? All experienced tremendous population growth. Israel, on the other hand, grows slowly but produces enormous technological advances.

The things to look at are technological changes and the ability of institutions to adjust. Remember the Luddites who predicted disaster as mechanization displaced agricultural workers? There's no inherent reason why technological advances cannot reduce the costs of goods and services to the point where very few workers are needed to provide both to everyone...but can we devise a society which will accomodate those changes?

There IS a direct relationship here. German social and Health systems are Bankrupt because of it. This is not conjecture, it is happening NOW. They don't have the population to pay into the system anymore. Their ratio now is 2:1. Soon it will less than 1:1. It doesn't take a mthematical genius to determine that this won't work.
Why do you think the EU is so determined to bring all these countries into the fold? There will be a centralised Tax system and the big 3 want to control them and benefit from the new members prosperity. Without those additions Germany could not sustain itself.
Of course there will be other problems, but those are 10-15 years down the road.

Agree with you on most.
Pre WW11 as well as WW1 the average German women had 7-8 children. Those were hard times and throughout history, the harder the times,the more children they had.
Now take the time of the "Wirtschftswunder". Germans had never experience such prosperity in their history. The problem was that the new found wealth didn't come with instructions. They decided to prop up their Social system and make promises they now can't keep.
"La dolce Vita" became the new slogan and young people took advantage of it.They brought in their "modern slaves" from different countries to do the work the regular German didn't want to do anymore.
The college argument is also not something they can complain about, since education is "free". Of course, now the Government has no money and is trying to have some co-pay instituted. You see a lot of protests all over the place. It is easy to give, but damn hard to take away? :-)

What am I missing??

You're missing: Over 2,000 illegals come into America every day. Since Bush's announcement on immigration, some 4,000 are crossing a day.

Vicente Fox has already told us, but we chose not to listen, that he is going for much, much more in the next meeting he is going to have with George Bush. He brags about being one nation with America, but the press refuses to tell this.

With our present rate of immigration, by 2050, and maybe sooner, America will be the home of 200 million immigrants. Politicians in Washington have already stopped serving the American people, and are spending most of their time serving Mexicans, since they will be the largest voting block.

Our president approves of outsourcing millions of American jobs, saying in the long run it will be good for the country. Is it good for California to have jobs leaving the state and 20 million third worlders coming in in the next 30 years? California alone spends 3 billion dollars a year on illegal health care.

Thanks to Ted Kennedy, Americas days are numbered. He is the father of all illegal immigration, and our politicians whom we voted for to protect our interests are in bed with him. Orin Hatch demands Utah citizens and the rest of us to pay for the college costs for the illegals children.

If anyone has the brains to look down the road a few years from now and listen to what our politicians are saying and doing, and has the guts to understand it instead of burying their heads in the sand, they will come to believe as I do: America is going to become a third world hell, and our politicians are responsible for it.

I don't see why technological advance couldn't reduce health care costs and retirement costs to where they are affordable. I read somewhere that something like 90% of medical costs are incurred in the last two years of life. Eliminate those final exhorbitant costs and medical care becomes affordable even without further advance. Throw in more emphasis on prevention and mitigation rather than cure and the financial problems diminish even more.

The problem is political and cultural, not economic.

I disagree with your doom and gloom. It just isn't going to be that way.
Those issues are very complex and not easily solved. Remember, every action has a reaction. good balance is neccessary to accomplish the best scenario.
Nothing is only good or bad. Look at the other extreme they are facing in Europe. Just because they looked away and had an attitude that somehow it will turn out alright.
Now they are broke and have no clue how to fix their mess.

You are overlooking a few minor details.
Of course technology has been a boom for us. Productivity has risen to an all time high. It will continue.
You are forgetting that we all pre-pay our medical costs in our retirement years already. it is a vicious cycle. On one hand we want lower drug prices. However, R&D is not cheap. If we don't allow companies to make a reasonable profit, where is the incentive to pay for R&D? I invest in quite a few Drug companies, believe me if they just greedy as so often portrayed, I would make a lot more money from their profitability.
Social systems are not funded by technology, but with cash.

Mitigation? =Tort reform, I am with you on that one.

Ther is one way to decrease medical costs. Mandate that every one has to have medical coverage. One thing that would do is lower premiums, since we would have the young, healthy individuals come into the pool and equalize our risk factors in medical coverage. At the present, a system that is totally out of balance since the young, healthy people refuse coverage and then blame the government for the lack of it.
Let them live in Europe where they are made to apy a percentage of their income as premiums. Contrary to leftist belief, there is no free health care anywhere on the globe.

["If anyone has the brains to look down the road a few years from now and listen to what our politicians are saying and doing..."]

I have, but I just disagree with your Malthusian analysis.

Remember, Free Trade is not (and never has been) about "Jobs, Jobs, Jobs." It's about providing consumers with high quality products at the cheapest prices.

Markets evolve (including labor markets). When they do there will also be market dislocations and short-run consequences.

I would agree with you to the extent that what makes a free society fail is government intervention (the politicians you were referring to) into the economy. Government intervention causes more harm than good. If you don't believe me then just look at what happened to the former Soviet Union. The "staple" of government planning.

Well you can remember me in a few years hence, and see if what I am suggesting is or is not coming true.

You'll see all of these things come to pass if American politicians don't end welfare to illegals, deport criminals immediately, put a stop to immigration, deport all illegals who are not working, and take all illegals off taxpayer supported health care. Unfortunately, politicians are so intimidated by the large Hispanic population, none of the above will ever happen. So, based on this, I believe my so called "doom and gloom" scenario is indeed going to happen.

You really need to talk to someone whose first hand information is fair and balanced, and living in California. In fact I'd suggest some living in South LA. You'll see what torment these loyal Americans are going through right now. California doesn't deserve this kind of lifestyle - none of us do.

This is a very complex issue. It won't be adressed by simple rhetoric.
There will always be individuals hurt and some will gain from any situation. It just depends on which side of the fence you happen to be on.
We also need to bring in proper education (or the lack thereof)into the picture.
In this modern world, the job market will always change and shift. In order for anyone to be able to take advantage of this situation is proper training to highlight the carreers of the future.
Look, we lost many bookkeepers with the arrival of computers, the same holds true with the automobile assembly lines. Robote have taken over. In the Job world, these are changes that will always occur.
If our young people don't realize this or are taught properly, they will be on the wrong side of the fence in the future.

As I've said repeatedly the problem is more cultural and political than economic.

Yes, R&D costs plenty of money but even without new drugs we can do much better than we do now by adopting changes such as you suggest...or others similar.

But can we or anyone else muster the will to make the changes? Can we even agree on what they should be?

Currently we believe that our system is the best and that proves that democratic capitalism is superior to socialism or communism. But democratic capitalism failed many times in the past. It took special conditions to establish our system and no one knows how durable it will be. Historically, aristocratic, slave-holiding tyrannies have been the most durable because they best reflected innate human differences. Does that apply today? Who knows...and who knows what will best accomodate future conditions?

Again, this is an extremely complex issue.
There are facts that enter into it from training for the future, to medicine, to funding promised social systems.
While there is a degree of politics involved, funding any kind of social system is economic in nature.
In order for us to be covered against health problems or be compensated if we can't work anymore due to old age or disability, money has to be available.
Remember, we all also live longer which is already being felt in the EU.
There will never be a perfect world or situation. We can only hope that we can tackle these complex issues and adapt to make them more manageable.
This subject could require discourse for years.

Sadly, that's exactly what is happening and going to happen in America. We'll be following in the footsteps of our insane liberal parents just across the Atlantic. Like father, like son. Unless, of course, we flood this country with so many people that it doesn't even resemble America.

Either way, America is probably dead from a cultural standpoint.

Remember, Free Trade is not (and never has been) about "Jobs, Jobs, Jobs " It's about providing consumers with high quality products at the cheapest prices.

But "Jobs, Jobs, Jobs" and I will add, high paying jobs are the source of American and European tax revenues. Americans are forced by our politicians to give billions and billions away each year to people all over the world. In addition to that, they are forcing us to spend billions upon billions of dollars for the illegals' health care, homes and even attorneys, when they get in trouble with the law. When America loses good paying jobs to India, who is going to pay for all these services our government has promised the world?

Our elderly American citizens have worked like dogs over the years to make America a great country. Now they are being taxed to death with property taxes to build thousands of new schools to accommodate illegals' children. In many cases, they are forced to sell family homes and move into small apartments. In my own area, we are building five new schools to accomodate the influx of illegals' children. I think this is unfair.

There was a book published in America during the 80s that told how the UN was working with politicians and corporate heads across America to send good paying jobs to third world countries. The goal of the UN was then to do away with the middle class in America. This is what is happening now. When the middle class is removed from any society, the entire society will suffer greatly. Low priced products won't pay for immigrant grandma's heart surgery.

What it boils down to, the world hates America and would do anything to see us brought to our knees. Our politicians have responded to this by selling their souls to our enemies for votes of illegals, and pay offs from corporations.

I know what made America great. Those who follow the policy of open borders and outsourcing good paying jobs will come to see that they have stabbed America through the heart. And many of them will be happy.

It just depends on which side of the fence you happen to be on.

You know you hit the nail squarely on the head! I am what I am. However, you are of a new age where you believe a different way. The two of us will not agree.

You see, I am 65 years old this year. I've seen and lived a lot of what may be just history to you. I've seen politicians tinker with the lives of citizens here in America, and mostly its been for the bad.

The bottom line is, I don't trust much of what any politician and economist tells me. I've seen it all before, and I know that when this present bunch gets finished with us, there are going to be only two classes of people: the rich and the serfs.

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